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Greitens’ budget calls for more than $500 million in cuts

  

JEFFERSON CITY, Mo. – For weeks, people have speculated as how much money Gov. Eric Greitens would need to cut in order to balance the state’s budget. Now, the answer has arrived.

Two weeks after his State of the State address, Greitens unveiled his budget for the 2018 fiscal year while speaking at the Nixa Early Childhood Center Thursday.

“Missouri’s budget comes out of your paycheck,” he said. “It’s your money, and you should hear directly and clearly how your government intends to use it.”

“The fact is that Missouri’s budget is broken,” Greitens continued.

Greitens’ budget calls for $572 million in state funding cuts, as well as a reduction in the state workforce in the amount of 188 positions. Acting budget director Dan Haug says he believes all of those state positions to have been vacant, meaning no employees would lose their job as a result of the budget cuts.

The governor said the state lost $150 million in corporate revenue last year and said the issues behind the lack of funding comes from poor economic growth and special interest tax credits, as well as Obamacare and the rising costs of healthcare. But he also laid the blame on politicians, a theme that has continued since his gubernatorial campaign.

“Politicians and insiders left us with a terrible plan. They planned to spend about $700 million that we don’t have,” Greitens said. “When you spend more money than you’re taking in, you lose your savings, you risk your credit, and you gamble with your future. That’s what our politicians have been doing. They have been spending this way so carelessly for so long, and they have left us with the mess.”

The governor’s $27.6 billion budget calls for increased funding for K-12 education, but continues with cuts to the state’s public colleges and universities, with roughly $100 million in cuts being made. In fact, the governor’s plan allocates the second largest percentage of appropriations after human services.

Rep. Gail McCann Beatty
Rep. Gail McCann Beatty

But House Minority Leader Gail McCann Beatty says there are a number of issues with the cuts in higher education.

“I’m a little concerned that we talk about wanting to bring jobs into our state, and yet we have cut higher education by some $150 million. How do we possibly provide an educated workforce for the businesses that we claim we are going to bring to our state?” she asked.  “We’ve had heard claims that we have not cut from K-12, however, we have cut from K-12 transportation, which is obviously going to have to trickle down to our classrooms. And despite the fact that we changed the formula last year and reduced the number, we still are not fully funding our foundation formula. So we have a lot of work to do.”

McCann Beatty’s comments referenced the fact that aid from the state for school busing programs is going to be cut by $31 million.

Higher education took the majority of the blows in education cuts, with the amount of general revenue going to Missouri’s colleges, universities, and tech schools being slashed by $90 million.

The governor’s proposal looks to restore money in a number of areas, like the $2.5 million to the state public defender system, as well as increased funding for law enforcement, with money for bulletproof vests and stun guns. It also calls for $11 million to fight opioid addictions in the state, and sets aside funding for the ‘Blue Alert’, a program Greitens has strongly advocated for.

The budget, however, sets aside no money for pay raises for state employees, the lowest paid in the nation, saying the “current revenue situation does not allow” for it. But the governor’s budget does recommend $56.8 million to fund the contribution rate for the state’s employee pension system and employee health care benefits.

Though Greitens and Republicans have decried the Affordable Care Act as a major contributor to the state’s budgetary issues, a summary shows Missouri will spend about $130 million more than the previous year by funding the department overseeing Medicaid. Greitens’ budget proposal does include a three percent reduction in reimbursements for the rate providers of Medicaid.

Two groups that could be facing adversity through the governor’s proposed actions are the elderly and disabled.

An estimated 20 thousand or more elderly and disabled residents, or roughly one-third of the 60,000 people who receive aid, could find themselves kicked out of in-home care and nursing services.

That’s because the proposed budget seeks to toughen the requirements for eligibility under the programs, which is expected to save the state roughly $52 million in general revenue.

“We had to make some difficult choices. The lobbyists and insiders won’t be happy with some of what’s in this budget, and that’s because this is a conservative, responsible budget that tries to do right by Missouri’s people,” Greitens wrote in a letter, included in the executive budget. “Not every problem that we’re facing in the state of Missouri can be solved over the next week, the next month, or the next year. But the recommendations in this budget are a strong start, and they will help to get our state in economic shape again so we can grow our way out of this mess. I look forward to working with you all as we take Missouri in a new direction.”

Brown
Sen. Dan Brown

Senator Dan Brown chairs the Senate budget committee. In a statement issued Thursday, he said they have known for months now that the budget was going to be tight.

“But we are ready for the challenge and ready to get to work,” Brown said. “We have a very talented and capable staff. We plan to work together to find savings, make government more efficient, and make sure we have a budget that’s balanced and shows our commitment to the Show-Me State.”

Rep. Scott Fitzpatrick, the House budget chair, commended the governor for making tough decisions, saying that Greitens had given lawmakers the best starting point that he had seen in his five years in the House.

“Without a doubt, this is the best budget that we have received from the governor to start our work with since I have been here,” he said. “It is the obligation of the General Assembly and the governor to balance the state budget in good times and bad.”

“We’ll be ready to go to work on the governor’s budget starting next week,” House Speaker Todd Richardson said.

Rep. Scott Fitzpatrick
Rep. Scott Fitzpatrick

Fitzpatrick says they’ll get started with testimony beginning on Tuesday, but it may be awhile before any bills are filed.

“We’re probably not going to file the bills right away. We’re going to look at the governor’s bills first, we’re not in any rush to file the bills because it will likely be later in March before the bills leave committee.”

The House and Senate will now take over. Typically, the budget is released with the governor’s State of the State address, but Greitens’ decision to split the two has given the chambers less time to work on appropriations, which must be completed by the end of the legislative session May 5.

Greitens will then be given the opportunity to sign or veto the budget bills or veto specific line items from the Legislature’s final budget.

The budget is scheduled to take effect on July 1.