The economic downturn could force the state to spend one-half billion dollars of its savings before July first to keep programs and services going at the present level.

Jay Nixon will be taking office at a time when the state budget is facing a major downturn. Latest figures show sales taxes collected by the state are down 24 million dollars in the first four months of the state fiscal year; Corporate income and franchise taxes are down 22-million dollars. Tax refunds have gone up by 22-million dollars so far, more money the state will not have to finance programs and services.

Commissioner of administration Larry Shepker says the trend is "worrisome"

Although he says the state has sufficient reserves to make it to the end of the fiscal year without budget cuts, the signs are not good. "We’re seeing a downturn in the prime indicator of that economy….the sales tax," he says.

Shepker doubts Governor Blunt will ask state agencies to tighten heir belts in the last weeks of his administration. The next state budget will be recommended by incoming Governor Jay Nixon and passed by next year’s legislature. Economic trends indicate some campaign promises might not be too affordable in that budget.

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