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Governor continues hold on state revenues despite HB 253 veto

More than a week since the Missouri House of Representatives upheld Governor Nixon’s veto of House Bill 253, and despite a state budget surplus of more than $330 million, the governor continues to withhold funds from certain projects.

At the time of the governor’s veto in June, Nixon announced he was withholding more than $400 million from items in the state budget, including more than $100 million from education, because of what he said were going to be huge state revenue decreases due to the tax cuts contained in House Bill 253.

Upon the legislature’s failure to override the governor’s veto, Nixon announced he was releasing $215 million in withholdings, including all the money held back from education.

But the governor is hanging on to $185 million for what his budget office terms “budget uncertainty.”

“We will keep things restricted until we are more certain that we will have sufficient revenue to fund the budget,” state budget director Linda Luebbering told the Missouri Times.

“The governor released the money he withheld from education quickly following the vote on his veto of the first tax cut for all Missourians in nearly 100 years, leaving some to question whether the money withheld from education was done for political effect to sway educators against HB 253,” said Associated Industries of Missouri president Ray McCarty.

But McCarty points out $700,000 is still being withheld from the Small Business and Technology Development Centers and $1 million that was appropriated to rebuild a technical school in Troy destroyed by fire is also being withheld. In fact, the legislature overrode the governor’s veto of the $1 million for the trade school, but the Governor continues to withhold the money which he maintains cannot be spent for that purpose.

“The state budget passed by the legislature follows months of public hearings and testimony by state agencies and is based on revenue numbers agreed upon by the legislature and the governor’s budget officers,” said McCarty.  “There should be no further withholdings unless it is clear there is insufficient money to fund the appropriations.”

McCarty suggested the current process should be modified to require some consensus between the legislature and governor that a revenue shortfall actually exists before a governor is allowed to withhold spending.  Press reports indicate State Rep. Todd Richardson (R-West Plains) and Senator Ryan Silvey (R-Kansas City) may introduce a constitutional amendment that will limit the ability of a governor to withhold appropriations, restricting such withholdings to times of emergency or true funding shortages.

Missouri voters would have the final say on the amendments.

“With more than $330 million carried forward from the previous state fiscal year, it is hard to believe there is a current fiscal emergency,” said McCarty. “The only fiscal uncertainty we can see is how much money the state will lose by Missouri businesses moving to states with more business-friendly tax structures.”

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