The State Auditor’s Office says Governor Jay Nixon violated the state Constitution when he withheld money in the Fiscal Year 2012 budget because the state brought in more revenue than needed to support that budget.

Missouri Governor Jay Nixon (left) and State Auditor Tom Schweich

Missouri Governor Jay Nixon (left) and State Auditor Tom Schweich

“The Missouri Constitution says that the governor can only withhold money when actual revenues are coming in below estimates and he withheld money when actual revenues were above estimates,” says State Auditor Tom Schweich.

When Nixon signed the budget bills for the 2011-12 business year he announced he was withholding more than $172-million in that budget to help in response to the May 2011 Joplin tornado, and to flooding in the spring of 2011. Less than $7.8-million was actually expended on those disasters that year.

The Auditor’s office says the governor could have used other, lawful, means to provide additional spending.

Schweich filed a lawsuit in August, 2011, arguing that the governor had violated the Constitution with his actions on the 2011-12 budget. The state Supreme Court in October ruled that Schweich was premature in filing his suit before the end of that fiscal year, and dismissed it without ruling on it. The Court said Schweich could file a suit again in the future.

Asked whether he will do so, Schweich tells Missourinet, “not necessarily.”

Schweich says in deciding whether to file another suit, he will look at how Governor Nixon handles the current fiscal year, but also the outcome of Constitutional Amendment 10 on the November ballot, that would give the general assembly the ability to override budget restrictions made by the governor.

“The Supreme Court said you’ve got to do the audit after the fiscal year so that’s what we did, so we’ve taken that step which gives us the right to sue if we want to, but we’ve certainly made no decision to do that.”

Schweich hopes voters will have the findings of this audit in mind when they go to the polls in November.

“I wanted the information out there for the general assembly and the voters so they could see what was going on with budget restrictions – how they were being misused,” says Schweich.

See the full report on the State Auditor’s website

The Governor’s office argues that expenditure restrictions on appropriations made by the governor have been in accordance with state law.

Nixon’s office says the audit overstates the importance of the consensus revenue estimate (CRE) and its relevance to the governor’s responsibility to make sure the budget remains balanced. That is an estimate of net general revenue collections used by the general assembly and the governor in deciding what amount of money to budget to for the coming fiscal year. It is generally, but not always, a figure agreed to by the legislature and the governor.

Schweich says the CRE is the only documented revenue estimate prepared and retained by the governor, has been utilized in the budget process for 20 years, and says the estimate has been recognized by the Supreme Court in cases challenging restrictions made by past governors.

Nixon’s office also rejects the audit’s suggestions of other methods for addressing budget shortfalls, including supplemental budget appropriations, line item vetoes rather than restrictions, and borrowing from the Budget Reserve Fund.

Schweich says he takes offense at suggestion that audit is political on his part

Schweich says the fact that he is a Republican and Nixon is a Democrat has nothing to do with the audit or its findings.

“If you look at my 450 audits that I have released since I have been Auditor, the grading, the harshness, the friendliness of those audits has been very evenly distributed among Republicans and Democrats,” says Schweich. “People can make an accusation but there’s simply not a single, factual basis for it.”

The audit also says the Office of Administration has not recorded the governor’s withholding decisions in “fully transparent manner.” The Office says it will consider changes to its reporting system to make such decisions easier to track.

The audit also says the use of estimated appropriations in the budget violate the state Constitution by allowing the Governor to spend from some appropriations without limit. It says the Cole County Court ruled the use of estimated appropriations violates the Constitution.

The Governor’s office notes that estimated appropriations are authorized by the general assembly on budget lines for which amounts are difficult to estimate, and argues that the Cole County court ruling was vacated by the state Supreme Court when it dismissed the Auditor’s 2011 suit, last year.