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Missouri House approves $34.9 billion budget, following heated debate on Medicaid expansion

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The Missouri House voted Wednesday afternoon to give final approval to a $34.9 billion state operating budget. GOP leaders say it’s a budget that’s about $146 million less than the current budget.

Missouri House Speaker Pro Tem John Wiemann, R-O’Fallon, (left) talks with House Majority Floor Leader Rob Vescovo, R-Arnold, on the House floor in Jefferson City on April 27, 2020 (photo courtesy of Tim Bommel at House Communications)

Most House members wore masks during the debate, which got heated during a discussion about Medicaid expansion. Due to COVID-19 concerns, there were just three people watching debate in the Capitol’s public fourth-floor galleries.

State Rep. Deb Lavender, D-Kirkwood, spoke several times on the House floor, criticizing legislative Republicans for approving $450 million in tax cuts in recent years. She says that money should have been used for education and other essential services.

House Budget Committee Chairman Cody Smith, R-Carthage, tells the House that the growing Medicaid budget has impacted higher education and other essential programs. He says Medicaid continues to grow.

Chairman Smith says the budget also includes $11 million for institutional staff stipends for corrections officers at the Missouri Department of Corrections, as well as $10 million for county jail reimbursements. Smith had hoped for $15 million, but notes COVID-19 impacted that.

COVID-19 has impacted the budget, and it’s impacted pay for state employees as well. Smith tells Missourinet the budget does not include money for pay raises for state employees.

More than 14,000 state employees work in Jefferson City, making state government the town’s largest employer.

Today’s debate also featured a heated discussion on the Missouri House floor, about the issue of Medicaid expansion.

Representative Lavender tells the House that states that have expanded Medicaid receive $500 more per person, than states like Missouri. But State Rep. Doug Richey, R-Excelsior Springs, argued against it, warning about the federal debt and the federal deficit.

Richey blasted House Democrats on the floor, for arguing for Medicaid expansion. He says it’s immoral and that Democrats want to deficit-spend.

The conversation got more heated when State Rep. Gina Mitten, D-St. Louis, and Rep. Richey spoke over each other during a heated floor debate.

“I dare you to go back to your constituents and say we don’t need no stinking federal dollars,” Mitten told Richey.

Chairman Smith also spoke against Medicaid expansion.

The budget now heads to the Missouri Senate, and Senate President Pro Tem Dave Schatz, R-Sullivan, tells Missourinet he expects the Senate Appropriations Committee to work through the weekend on the budget.

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Will the governor’s higher education budget restrictions affect tuition at Missouri colleges?

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Governor Eric Greitens’ $146 million in budget restrictions announced Monday include $80 million in higher education. The budget withholdings could affect tuition at Missouri’s colleges and universities. House Minority Leader Gail McCann Beatty (D-Kansas City) hopes the pain won’t reach that far.

Minority Leader Gail McCann Beatty

“I haven’t had a chance to talk to anyone at the universities, but that’s very much possible, which is then putting yet another burden on our students that are already struggling to get through school,” says Beatty.

About $56 million in Greitens’ budget withholds are in core funding for Missouri’s two-year and four-year colleges and universities. Other funding cuts targeted included the A+ Schools Program and certain college programs.

In a statement from Greitens, he says Missouri’s budget is suffering from reduced revenue due to poor economic growth. He says that revenue is being drained by special interest tax credits and the faster-than-projected growth in healthcare expenditures, driven in part by the national impact of Obamacare.

Greitens says during the next 18 months, more than $700 million in budget cuts will be necessary just to make the budget balance and retain Missouri’s AAA credit rating.

Gov. Eric Greitens (Photo courtesy of Bill Greenblatt/UPI)

“The fact is, that more hard choices lie ahead. But as Missourians, I believe we must come together, tighten our belts, be smart and wise with our tax dollars, and work our way out of this hole by bringing more jobs with higher pay to the people of Missouri,” says Greitens.

Additional details on the spending restrictions are linked here.

Governor Greitens will hold Tuesday his first State of the State address. The speech is traditionally when the Governor releases the state budget proposal, but Greitens plans to wait until February to unveil his budget requests.

Listen to live coverage of Governor Greitens’ State of the State address on Tuesday on Missourinet.com and ABC 17. Joey Parker of ABC 17 and Missourinet’s Brian Hauswirth begin their preview at 6:45 p.m.

Continue to follow our coverage on Wednesday, as we bring you the response of legislators from around the state.

Budget restrictions mean no raise for transportation employees, either

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Missouri Highways and Transportation Commission member Joe Carmichael (courtesy; Missouri Department of Transportation)

Missouri Highways and Transportation Commission member Joe Carmichael (courtesy; Missouri Department of Transportation)

Transportation Department employees, like other state employees, will not be getting a raise because of actions taken by Governor Jay Nixon (D) with the budget.

One of the items Governor Nixon has put a halt on funding in the new budget is a one-percent, across-the-board raise in pay for state employees.

The Transportation Commission can act independently of that budget, but Commissioner Joe Carmichael says it follows what other state agencies do, so a matching raise for transportation employees is also on hold.

“There was also a $25 a month employee deferred comp match, and that is part of the withholding as well,” says Carmichael. “Again, we’ll follow suit, and those are very difficult things.”

Carmichael expresses optimism the restriction will not be permanent.

“We expect once state revenues improve and the state budget becomes more certain that those will be lifted,” says Carmichael. “That’s certainly our hope and, I think, it’s a reasonable expectation.”

Carmichael also noted the restriction of $1-million for the state transit assistance program and $3-million for capital improvements to ports.

Nixon says the legislature’s budget was more than 780-million dollars out-of-balance. Lawmakers say he is using inflated and inaccurate numbers.

Legislative budget chairs slam Gov. Nixon for budget vetoes and restrictions (AUDIO)

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Republican budget leaders are slamming Governor Jay Nixon (D) for the actions he has taken with the state budget for the fiscal year that begins July 1. They say he is using “inflated” figures to estimate the impact of tax break bills passed on the final day of the session, and playing politics with the state’s children and the disabled in an attempt to force lawmakers not to override his vetoes of those bills.

Senate Budget Committee Chairman Kurt Schaefer (R-Columbia) and House Budget Committee Chairman Rick Stream (R-Kirkwood) co-chair the budget conference committee. (photo courtesy; Tim Bommel, Missouri House Communications)

Senate Budget Committee Chairman Kurt Schaefer (R-Columbia) and House Budget Committee Chairman Rick Stream (R-Kirkwood) co-chair the budget conference committee. (photo courtesy; Tim Bommel, Missouri House Communications)

Nixon announced on Tuesday vetoes totaling $144.6-million and restrictions of $641.6-million from the state budget. Coupled with federal and other dollars that results in a reduction of $1.12-billion dollars for state programs, services and employees.

Nixon says the legislature sent him a budget that was more than $786-million out of balance. He says that’s in part because the legislature didn’t account in its budget for the impact of those 10 tax break bills, which he says could rise to $425-million in lost state revenue.

Senate Budget Committee Chairman Kurt Schaefer (R-Columbia) and House Budget Committee Chairman Rick Stream (R-Kirkwood) say those bills were paid for in the general assembly’s budget proposal, and say Nixon has overplayed the effect those bills will have on state revenue.

“We looked at all the fiscal notes (on those bills) and (Nixon) took the high position on all those fiscal notes,” says Stream, “so we disagree with him on those estimates.”

Nixon’s is restricting proposed increases of more than $100-million for K-12 public schools and $43-million for colleges and universities, and says he could release those funds if the legislature doesn’t overturn his vetoes of those ten bills.

“He inflates the numbers,” says Schaefer of Nixon’s assessment of those bills, “to really hold school kids, kids with autism, mental health services, other things, hostage in order for Missourians to not get a tax break.”

Both budget directors say withholds have been anticipated because state tax revenues are behind last year’s, and behind the projections both Nixon and the legislature used in proposing the new budget.

“We budgeted to a number that we thought we were going to grow to and it just didn’t happen in the six months that we’ve had to look at it,” says Stream.

Schaefer says Nixon has exacerbated the revenue shortage by not having a plan for economic development.

“The only economic development plan this governor has had for six years is expand welfare and take Obama dollars,” says Schaefer.

AUDIO:  Schaefer criticizes Gov. Nixon, accusing him of having no plan for economic development

Nixon says the legislature’s inaction on expansion of Medicaid eligibility, that could draw more federal dollars, is making the state’s economic situation worse.

Nixon also blames the need for his actions in part on the legislature basing its budget on the passage of tax amnesty legislation. Schaefer says the budget didn’t assume the passage of that legislation, which has been offered but hasn’t achieved passage for several sessions.

House Republican leaders: Nixon using fear tactics to back vetoes, overturn attempts uncertain this soon

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House Republican leaders accuse Governor Jay Nixon (D) of using fear tactics and overblown numbers in his assessment of the ten tax break bills he vetoed last week, but they don’t yet know if their party will seek to overturn his vetoes.

Nixon says those ten bills would cost state, county and city budgets $776-million dollars in revenue he says would be lost to “sweetheart deals” for special interests. He has been traveling the state to promote his arguments in defense of the vetoes, and telling local governments to leave room in their budgets to absorb the losses he says would be incurred if the legislature overturns those vetoes.

House Speaker Tim Jones (R-Eureka) tells local governments to use their own analysis.

“Because my impression of what these bills tried to do, what their intent was, was to reign in Governor Nixon’s out of control Department of Revenue, which has been out of control in many ways,” says Jones.

Majority Floor Leader John Diehl (R-Town and Country) says the local government leaders he’s talked to aren’t taking the Governor’s message about those ten bills seriously.

“His playbook of scare tactics is wearing pretty thin with people,” says Diehl of the governor. “He’s cried wolf on numerous different occasions over the past couple of years, none of which have proven to be true.”

Legislative analyst estimates on what the fiscal impact of most of those bills could be are still being updated, but Jones says he’s hearing that Nixon’s estimates are off.

“The consensus is that the governor’s numbers are completely inflated and generally seem to be pulled out of thin air without a lot of backup data,” says Jones. “I know that’s why the proponents of the bills and the sponsors are doing their best to make sure that their analysis is fully supported by the facts. They were comfortable about that the first time around, so we’re just going back and double checking.”

Several House Republicans have alluded to possible attempts to override Nixon’s vetoes of at least one of those bills when lawmakers return for the annual veto session in September, but Diehl says it is premature to predict whether such attempts will be made.

“We will take a look at the governor’s veto message to see if any valid points are raised in the veto message. Here, I don’t think there are any,” says Diehl. “We then take that veto message and the bill and we’ll discuss it as a caucus in August when we all meet again.”

Diehl says House and Senate Republican leaders must also meet before any decisions will be made about addressing the governor’s vetoes.

“I think it’s premature,” says Diehl of announcing overturn attempt now, “but I think there’s a strong possibility that we’ll make efforts to do that.”

See an earlier story on the ten bills vetoed by Governor Nixon

Nixon vetoes ten bills he says would have hurt state, local budgets

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Governor Jay Nixon (D) has vetoed ten tax cut bills that he says could have reduced state and local revenues by more than $776-million dollars.

Nixon called the bills “secret, sweetheart deals so that the well-connected can pay less, while asking all Missourians to pay more,” and said they reflect, “priorities that are dangerously out of whack.” He says they would “undermine local public services and flout the will of the voters by eroding revenues that support services like firefighters and cops, libraries and ambulance services, snow plows and health inspectors, public transit and road repair.”

Republicans say Nixon is wrong in his assessment of those tax cuts, and say they would have a positive net impact on the economy.

See Nixon’s statement along with his veto letters on each of the ten bills

Nixon says because the legislature might overturn his vetoes he will make adjustments to the budget in case these bills still become law.

“I’ve got to assume that even though I’m vetoing them that I have to deal with them budgetarily. I don’t have the luxury of closing my eyes,” says Nixon, “So the negative impacts of these are going to be felt in the next few months because of the action taken by the legislature. I can’t not account for them.”

Nixon encourages city and county governments, who he says also stand to lose money if those bills become law, to also make adjustments to their budgets to account for the possibility that his vetoes get overturned.

“They’ve got to balance their budgets. The budget starts on July 1. Taking hundreds and hundreds of millions of dollars out of local, voter approved levies must be dealt with by mayors, city councils, county councils, ambulance districts, fire districts, all of those folks now,” says Nixon. “They’ve got, just like I do … hard decisions to make right now.”

Nixon doesn’t say what actions he will take with the budget in relation to the ten bills vetoed Wednesday. That could include withholding money appropriated to certain parts of the budget, or making restrictions to some lines that are contingent on his vetoes being sustained.

Lawmakers return to the Capitol in September to consider whether to attempt to overturn any of Nixon’s vetoes.

The bills vetoed Wednesday by Nixon are SB 693, SB 584, HB 1865, SB 612, SB 860, HB 1296, SB 727, SB 662 and HB 1455 and SB 829.

Gov. Nixon withholds more education spending, cites lottery and gaming revenue shortfalls

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Governor Jay Nixon (D) says he will freeze another $35.1-million in education spending due to a continuing decline in revenue from lottery and gaming. Nixon says he will restrict the spending of $10.5-million for four-year higher education institutions and $24.6-million from the K-12 education funding formula.

Lottery and gaming revenue are directed to education by Missouri law.

This latest action is in addition to $22-million he restricted in higher education and K-12 spending in April. Nixon had asked the legislature to provide $44-million in a mid-fiscal-year supplemental budget to make up for lottery and gaming revenue falling short. Legislative budget makers thought $22-million was enough and provided that amount instead. Nixon then withheld $15.6-million from K-12 schools and $3.2-million each from community colleges and four-year universities.

Nixon says he remains concerned that the legislature didn’t account for lottery and gaming revenue trending lower in its fiscal year 2015 budget, sent to the governor less than two weeks ago.

Read the statement from Gov. Nixon’s office

Budget director: will work with lawmakers on how association dues are paid

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The state’s budget director tells House Republicans the Nixon Administration’s budget office is willing to work with legislative budget makers to change how the state pays dues to organizations its agencies and elected officials belong to.

Republicans called attention this week to the paying of dues to the National Governors Association out of the budget for the Department of Social Services’ administration. For three years that added up to more than $390,000 dollars.

See earlier story

Budget committee members including Representative Caleb Rowden (R-Columbia) feel they appropriated money to be used by that agency, not to pay organization dues.

“We feel like we’ve been duped, I think it what it really boils down to, intentional or not,” Rowden told State Budget Director Linda Luebbering. “It’s absolutely and unequivocally wrong, and there’s no other way to put it.”

Luebbering told the committee she doesn’t have the authority to commit to changing how dues are paid, but said she would talk with others in the Nixon Administration and future legislative budget makers about the issue.

“I have committed that we are willing to work with the House and Senate to see if we can’t come to agreement on how to do this differently in the future.”

Republicans say the appearance is that the paying of the Governors Association dues was being hidden, but Luebbering says that was not the intention.

“There are dues paid in a lot of different places in appropriations. They don’t have specific line items. This is not any different from the other ones,” Luebbering told lawmakers. “Clearly we felt it was appropriate, clearly previous administrations have paid it from various places as well.”

Luebbering notes other expenses such as food are also covered out of administrative appropriations that don’t have specific line items.  She says the expenditures can be found on the Missouri Accountability Portal.

“We think it is just as transparent as any other dues that are paid in state government,” says Luebbering.

Representative Chris Kelly (D-Columbia) disagrees, and calls the expenditures, “clearly not transparent, extremely opaque.”

Representative Robert Ross (R-Yukon) says “incredible” is that the Governors Association dues were paid out of the Social Services budget in September of 2013, three months into the fiscal year’s budget.

“If that’s the case, clearly we have been over appropriating to Children’s Division, Social Services, the whole gamut, if they already know at that point that they have extra money and can say, ‘Hey, let’s pay the Governors Dues on this.'”

Kelly says the only way such expenditures will stop is if future budget committees do a more extensive job of going over the state budget.

“I think we are not doing as good a job managing the budget as Jeremiah Nixon is at spending the money,” says Kelly. “We’ve seen example after example of example of that brilliance, about how he finds ways to spend the money in ways that we don’t authorize.”

Kelly suggested twice the amount spent on dues be removed from the governor’s budget for Fiscal Year 2016.

House Speaker Tim Jones (R-Eureka) in his comments Friday on the end of the regular session of the General Assembly hinted that work to review such expenditures will continue during the legislative interim.

Children’s Division Director responds to proposed funding increase

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The Senate Budget Committee Chairman has said he will be watching for results from the Children’s Division within the Department of Social Services for improvements in its handling of child abuse cases. That comes as the legislature and Governor Jay Nixon (D) both recommended $5.1-million additional dollars for the Division, intended to help it lower the turnover rate among abuse investigators and to help reduce a backlog of abuse reports.

The Division Director, Tim Decker, says it is ready for additional scrutiny.

“We expect results of ourselves,” says Decker. “We want to see enhanced well being for the children we serve. We want to be sure they’re getting their healthcare needs met. We want to be sure that they’re having the same opportunities that we want for our own children; to go to college, to pursue a career, to have those lifelong supports they’re going to need.”

See an earlier story on the additional $5.1-million for the Children’s Division

“Ultimately the way you measure results in the child welfare system is whether children are safe, whether children in the system are reunifying with their families or moving on to another permanent placement,” says Decker, “Because all children need a loving family that’s going to be with them for the duration.”

Decker believes the additional money will make a difference.

“These investments will actually strengthen our workforce,” says Decker. “They will prepare people for the work, for the difficulty of the work, and they’ll really build a career pathway so that some of our best staff can remain on the front lines working with the children and families.”

The proposed increases for the Children’s Division are included in the Fiscal Year 2015 budget proposal approved by the legislature last week.  Governor Nixon still must act on that budget.

Click here to listen to an interview with Tim Decker

Gov. Nixon issues statement on legislature’s FY15 budget proposal

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Governor Jay Nixon (D) has issued a statement on the legislature’s passage Thursday of its proposed Fiscal Year 2015 budget.

Nixon says lawmakers followed his lead in offering more support for individuals with developmental disabilities and helping more people afford college educations, but criticizes the legislature for not heeding his call to expand Medicaid eligibility to 138-percent of the federal poverty level.

He is also critical of the tiered budget approach legislators took to compensate for the fact that they couldn’t come to agreement with his office on how much revenue the state would bring in, in Fiscal Year 2015.

Nixon’s statement reads:

“‘From making college more affordable to expanding services for Missourians with developmental disabilities, this budget includes many of the priorities I laid out earlier this year,’ Gov. Nixon said. ‘These smart, strategic investments in our future are made possible by an economy that continues to pick up steam.

“The Fiscal Year 2015 budget passed by the General Assembly includes Gov. Nixon’s proposals to eliminate the waiting list for Medicaid in-home developmental disability services, freeze tuition for Missouri undergraduates at public universities for the upcoming school year, and provide additional technology and career-support for staff at the Children’s Division of the Missouri Department of Social Services. The budget also includes the Governor’s plan for a strategic bond issuance to rebuild Fulton State Mental Hospital, the state’s only maximum-security psychiatric facility.

“‘While making progress in many areas, in other respects the legislature missed the mark by failing to make K-12 education the priority and refusing to strengthen Medicaid,’ Gov. Nixon said. ‘Quality public schools are vital to the strength of our communities and the health of our economy, but many in this legislature simply don’t agree. For example, the legislature has chosen to subject K-12 education to a conditional funding mechanism that creates uncertainty for local school districts. In the coming days and weeks, this budget will get a careful, line-by-line review to ensure we maintain fiscal discipline and keep the state moving forward.'”