“It goes without saying that COVID-19 has had severe impacts on our anticipated economic growth. This is truly unlike anything we have ever experienced before, and we are now expecting significant revenue declines,” Parson said.
These cuts come after a decline of more than 300,000 jobs in the state in March and April, more than a 10 percent decrease. The unemployment rate rose from 3.9 percent to 9.7 percent in April. Two rounds of budget restrictions had been announced that month as well.
“We could have never imagined that this is where we would be today, but we’ve had to face the reality of the situation and make some extremely difficult decisions regarding our state budget,” said Parson. “We have already had to withhold over $220 million dollars due to budget concerns resulting from COVID-19. In addition to these restrictions, we will be restricting another $209 million dollars in June.”
Cuts are set to reduce funding for the Department of Corrections, Office of Administration, Department of Health and Senior Services, and the Department of Elementary and Secondary Education, as well as the Department of Higher Education. More than $41 million is set to come from the Department of Higher Education and Workforce Development, and $131 million from DESE.
“With the timing of these budget shortfalls, the majority of today’s reductions will be reflected in our June payment to schools,” said DESE Commissioner Margie Vandeven during Monday’s press briefing. “We are embarking upon historic budget shortfalls, and we remain hopeful that they are temporary as our economy begins to recover.”
Missouri Department of Higher Education & Workforce Development Commissioner Zora Mulligan was also present.
“One thing that will be uniform throughout the state is an unflagging commitment to the principle that education changes lives and that it’s our jobs as educators in the higher education space to make sure that continues to be available to the students we serve,” she said.
“I have always been a strong supporter of education, and these were extremely difficult decisions I never thought I would have to make,” Parson said. “As difficult as these decisions are, we are experiencing an unprecedented economic downturn, which means we are having to make unprecedented adjustments in our budget.”
Parson also has waived Section 163.031.7, RSMo, which gives some districts a “held harmless” pass from budget shortfalls. This waiver removed those exemptions. Missouri is set to use $187 million in CARES Act funds to help schools in the short term.
“It is important to make these decisions now so school districts can adjust before next school year,” Parson said. “Our intent is to withhold now and avoid withholds once school begins.”