House begins budget work

By State Rep. David Klindt

Last week the governor released his final state budget and appropriations committees have been meeting to consider the governor’s recommendations for funding next year’s budget. The new state budget totals over $17 billion which is over $520 million more than the current state budget. And just like every year, this amount will grow over the next three months as the governor revises his revenue estimates and finds more money.

The growth in the state budget over the past few years has been a point of contention in the Legislature and it appears that this year may prove to be even worse. In December 1999, the Chairman of the House Budget Committee sent a letter to all state representatives warning that we were in the midst of a “revenue shortfall.” The chairman said, “We are now in the position of not having adequate revenue to provide the minimal services needed and expected by our citizens.” The chairman attributed this “revenue shortfall” to Hancock refunds and the tax cuts which have been required the past three years to bring the state back into compliance with the Constitutional revenue limit.

After the massive tax increase in 1993, the state budget has grown approximately $800 million every year and state government has expanded proportionately. New government programs have been created which now require ongoing funding and hundreds of new state employees are on the payroll. For example, Medicaid was expanded to the middle class in 1998. This Medicaid expansion, known as MC+, provides healthcare for children in families of four who earn over $50,000 per year and have up to $250,000 in assets. Some parents also qualify for this program. In the current budget, we are spending over $261 million on this program and the governor

has recommended spending an additional $13.3 million during the next fiscal year. In 1990, the Missouri Medicaid appropriation totaled $833 million. In this fiscal year, the total appropriation for Medicaid is $3.3 billion.

Also in 1998, the state began paying for daycare for children. This year the state is spending over $166 million to pay for daycare and provide money to daycare centers for their start-up and expansion costs. The governor has recommended an increase this year of $20.4 million.

Furthermore, the Commissioner of Education testified recently that he wants several million dollars each year from the Tobacco Settlement funds to further expand these daycare programs. The governor also called for this in his State of the State speech.

The governor also included a new program in this year’s budget recommendations. A new vehicle emission test is being implemented in St. Louis which will require vehicle owners to have their cars tested. This is because air pollution levels in the St. Louis region are in violation of the federal Environmental Protection Agency’s standards. As a result, the governor has budgeted $2,250,000 to give low-income families up to $450 each to cover costs to repair their cars if they don’t pass inspection.

The House also gave first-round approval to HB 1506 this week. HB 1506 creates the Missouri Tobacco Settlement Trust Fund. Money from the tobacco settlement would be deposited into this new Fund and could not be spent until after voters have approved a constitutional amendment approving how the money can be spent and to decide whether or not these new revenues should be counted toward the Hancock Limit. The amount of money Missouri will receive from this lawsuit is uncertain. In fact, the original estimates are much less now than originally reported. The Attorney General originally said that Missouri would receive approximately $245 million per year for 25 years, or $6.7 billion total. There is currently $105 million being held in an escrow account with an estimated additional $78 million to be deposited into the account in April.