State Auditor Tom Schweich has filed a lawsuit in Cole County Circuit Court that says Governor Nixon violated the Missouri Constitution and failed to utilize established accounting principles when he withheld more than $170 million from state agencies, programs and educational institutions prior to the start of the current fiscal year.

Nixon withheld the money for disaster recovery needs in the state. 

AUDIO: Nixon on budget withholdings and Joplin 061011 [Mp3, 6:32 min.]

Schweich says he sent a letter to the governor expressing serious concerns about the legality and financial basis for his withholds. He says “the Missouri Constitution states the governor can only make withholds based on current fiscal year revenue data, at which time there was none.”

The auditor also noted that the governor withheld funds from the Republican controlled legislature and the Republican auditor, but did not cut funds for his own office or any Democrat statewide elected official. “Our state has recently experienced natural disasters of historic proportion,” Auditor Schweich says. “There is no dispute that the victims of the tornadoes and floods must be fully compensated for their tragic losses. But the process must be legal and transparent. There are many legal and transparent ways to do this.”

“Our office does not like litigation. We prefer matters to be resolved by dialogue,” Auditor Schweich says. “I recommended the governor work with the legislature on this issue. Instead of correcting his actions and working with the legislature, the governor has said, ‘the auditor is wrong.’ These withholding are critical as they will result in programs ending and jobs being lost.”

To hear Schweich question the legality of the withholdings, visit this story filed previously by Bob Priddy:

The auditor’s suit alleges:

Gov. Nixon’s withholds were unconstitutional. The governor withheld more than $170 million dollars prior to the start of the current fiscal year without any projections or accounting data of any kind as noted in a report released last week by the state auditor’s office (Report No. 2011-43). Article IV, Section 27 of the Missouri Constitution grants the governor the ability to withhold funds only when actual revenues are less than the revenue estimates. At the time of the governor’s withholdings there were no actual revenues. Interestingly, revenues for the first month of the 2012 fiscal year, July 2011, actually increased .6 percent over 2010 revenues for the same period.

Gov. Nixon’s withholds violate the separation of powers. When he withheld more than $170 million dollars from state programs, the governor violated Article III, Sections 1 and 36, and Article IV, Sections 23, 24, 25, 26 and 27 of the Missouri Constitution, infringing upon the power of the General Assembly to specify the distinct amount and purpose of each appropriation when withheld funds are unilaterally diverted and reallocated.

Gov. Nixon’s withholds were arbitrary and capricious. The governor withheld more than $170 million dollars from more than 45 different state programs and agencies. Article IV, Sections 24, 25, 26 and 27 of the Missouri Constitution states the governor must manage the budget in a responsible manner and with discussion with the state legislature. The state auditor’s report found that Gov. Nixon’s withholds were made without any backing data from ledgers, spreadsheets, Microsoft Excel documents, cash balance sheets or any other generally accepted accounting tool.

As the auditor’s office believes it is important for the court resolve to this very important matter, that state auditor’s office will make no further comment on the litigation unless its position is unfairly or inaccurately characterized.

The withholds were made from appropriated funds for: Parents as Teachers, Bright Flight Scholarships, Medicaid, community colleges and state universities, veterinary student loans, the Missouri Film Office, community intervention programs, Area Agencies on Aging (funding partially restored), domestic violence grants (funding partially restored), children’s treatment services, the judiciary, trade zone facilities, regional port authorities, math and science tutoring, the Scholars and Fine Arts Academy, the Missouri Lottery, the Missouri Department of Transportation, the Missouri Federal and State Technology Partnership Program (MOFAST), MOHELA Projects, the Missouri State Penitentiary (MSP) Remediation, marine maintenance facility, civil detention and legal fees, Alzheimer’s grants, Access Missouri Scholarship, crisis care services (funding partially restored), the Missouri Research and Education Network (MOREnet), the Office of Child Advocate, Boonville Readiness Center, community development corporations, transportation, early grade literacy, industry training, local air pollution control, eating disorders staff & expenses, mediation and firefighter training.


Governor Nixon’s office released a statement that talks about the budget and disaster recovery, but does not directly address the lawsuit:

“Just this week, Missouri’s AAA rating – the highest available – was affirmed once again,” Nixon’s office says in a statement e-mailed to Missourinet. “A key basis for this rating has been Gov. Nixon’s fiscal discipline in managing Missouri’s budget. To achieve this, the Governor has used his constitutional authority to fulfill his responsibility to reduce spending to balance the budget, a power used by Governors over the years and consistently upheld by the courts.  


“The Governor will continue to fulfill his responsibility to balance the state budget, fund essential government services and help our communities recover in the wake of the many natural disasters this year, including the devastating tornado that hit Joplin. Gov. Nixon will continue to ensure that Missouri will meet its obligations to help communities recover and rebuild from these disasters.”