“Securing Missouri’s Future” was the theme of Gov. Mike Kehoe’s State of the State Address on Wednesday. He delivered the address to members of the Missouri Legislature, which included the rollout of his state budget proposal for Fiscal Year 2026.

Now that the governor has released his $53.7 billion state budget proposal, the legislature’s budget work can begin.

An item that stands out in Kehoe’s fiscal outline is his $4 billion request to fund the formula used to bankroll K-12 public schools – underfunding them by about $300 million.

“The foundation formula in its current form has gotten out of control,” he said.

Kehoe has issued an executive order to create a task force to update the formula used to fund to public schools.

His budget request includes $376.5 million to fully fund school bus transportation costs.

House Minority Leader Ashley Aune, D-Kansas City, said Democrats will fight to protect and bolster public education at all levels.

“We are disheartened that right out of the gate, the new administration is planning to retreat from its commitment to public education by failing to fully fund K-12 schools – a promise Gov. Kehoe made last year when he lobbied to pass SB 727,” said Aune.

Another budget ask that is contentious is Kehoe requesting $50 million in direct state funding for private schooling scholarships.

“By adding state funding to the tax credit program we will be able to serve substantially more children than the program has in the past year,” said Kehoe.

There could be a court battle if that item sticks.

“My understanding is that the reason that we have made these tax credits is because it is unconstitutional to directly give money to private school institutions,” Aune said.

Missouri plans to make changes to strengthen its early childhood education system. Kehoe is requesting $161 million in childcare subsidies for low-income families. He also wants $10 million in grants to bring together employers, community partners, and providers to increase access to childcare.

“The biggest challenge to the childcare crisis is getting more teachers in early childhood classrooms and addressing the current regulatory environment. To be successful, we need commitments from the local and state levels, from public and private partners working together, to find ways to expand access to quality childcare in every community across the state,” said Kehoe.

Rep. Aune said expanding childcare access is a bipartisan priority.

“We need to make sure that we invest in our childcare infrastructure in the state. That is a workforce development problem. That is an economic development problem. We hear from businesses across the state that they struggle to hire folks because they don’t have childcare. That is an embarrassment to our state,” she said.

The governor has issued an executive order to have the state streamline its childcare regulations.

The Republican governor has made crime his top priority. During his address, Kehoe said he wants drug dealers to be charged with first degree murder if they sell fentanyl that kills a Missourian.

“I urge the legislature to take action on this and support Senator Schroer and Representative Keathley’s efforts, in honor of all those lost to this tragic epidemic,” said Kehoe.

Under Schroer’s bill, if someone is convicted of the crime, they could be sentenced to death or life in prison without parole.

Kehoe said that his administration will be “relentless in our pursuit to make Missouri a place where it’s easier to be a cop than a criminal.”

Aune is critical that Kehoe’s budget plan won’t lead to real solutions.

“All Missourians have a right to feel safe in their homes and communities and crime prevention is at the forefront for House Democrats,” she said. But as long as the governor and his party continue to refuse to do anything about gun violence, their tough on crime talk will never lead to action that actually reduces violent crime.”

Another priority is bringing jobs and businesses to Missouri. Kehoe said Missouri must have a “robust economy and aggressive economic development efforts.”

“From manufacturers, to retailer, to Missouri’s sports teams, these businesses, who provide jobs and opportunities to Missourians, are an important part of our state’s economic success. That’s why we support legislation to extend the Deal Closing Fund,” said Kehoe.

The fund includes tax credits for businesses and allows businesses to retain state tax withholdings. It is set to expire in 2030, unless the legislature extends the expiration date.

Missouri has about 49,000 state workers. Kehoe is proposing $129.9 million to create a state worker retention pay plan increase – a 1% salary increase for every two years of service, with a cap of 10% for 20 years of service.

“Right now, it’s extremely difficult for our agencies to operate efficiently with an average turnover rate of 20% in our state workforce,” he said.

A main talking point leading up to the November election was the higher cost of living, and since then Missouri Republicans have discussed efforts to provide tax relief. Kehoe said that he wants to eliminate the individual income tax.

He said that for Missouri to compete with other states, lawmakers need to reduce taxes and cut regulations so that families can keep more of their own money.

But Rep. Aune said that the state can’t afford the change.

“If we are going to talk about reducing the income tax, capital gains tax, if we’re talking about all of that, then we need to have a hard conversation about what we are going to cut, what services we’re going to cut, and what Missourians are going to lose out due to that decision,” she said.

Kehoe, who is a first-generation farmer, also has plans for the agriculture industry. He wants to borrow $55 million for new livestock buildings at the Missouri State Fair. Under his plan, the funds would be paid back over time by a portion of the revenues generated by these locations.

He said government must get out of the way and let farmers and ranchers continue to produce results.

“Our hard-working agriculture families and their efforts are critical to Missouri’s economic success,” he said. “Securing the future of agriculture also means investing in the next generation. At the urging of Senator Black, our budget includes $800,000 in permanent funding for Missouri FFA.”

Other budget wishes from the governor include:

*$1.17 billion in core funding for Missouri’s public colleges and universities – a 1.5% increase
*$163 million for operations of Missouri’s seven veterans homes
*$149 million for developmentally disabled citizens in need of residential and in-home support
*$71.6 million to provide behavioral health services through Medicaid for people in need of residential and in-home support
*$60 million to fix rural roads
*$40.5 million to prepare for the FIFA World Cup in 2026
*$33 million to meet the state’s teacher pay minimum requirements
*$30 million for small school grants
*$25 million to support community-based support for crime victims
*$6.7 million to expand Fast Track scholarships for working adults returning to school for programs in high demand fields
*$3 million in federal funds to open an adult high school in the Jackson County area
*$1.3 million for diagnostic services at autism centers in Rolla and Springfield
*$1.25 million in grants to place one deputy sheriff in each Highway Patrol troop to coordinate with local law enforcement in capturing people with arrest warrants
*$1 million in law enforcement academy scholarship to add 200 police officers
*$330,000 to expand Missouri’s meat and poultry inspection program
*$105,000 to help prevent and respond to animal diseases

To see the governor’s budget proposal, click here.

By Anthony Morabith and Alisa Nelson

Copyright © 2025 · Missourinet

Share this: