Nixon plays it safe with his final state budget
For his final state budget, Missouri Gov. Jay Nixon is taking no risks.
His proposed budget for the fiscal year that begins July 1 features no grand gestures of setting up new programs, and calls for limited increases for the state’s current operations.
He’s seeking an additional $85 million for the state’s chief school-aid program, known as the “foundation formula.’’ But that will still be about 40 percent short of the amount needed to fully fund the formula. All told, the governor notes that he has increased annual school-aid funding by $400 million since he took office in 2009.
His last State of the State address, delivered Wednesday night in the Missouri House, makes another pitch for expanding the state’s Medicaid program, as recommended by the federal Affordable Care Act.
"This should be the year that we find a way forward, with a Missouri solution that rewards work, demands personal responsibility, brings our tax dollars home, and gives health care to 300,000 working Missourians," the governor said. "Make no mistake – inaction has real consequences. It’s time to stop playing politics with people’s lives. Do the right thing and give them access to health care."
But his proposed budget assumes that won’t happen. So the document doesn’t include the roughly $2.4 billion in federal money that the state is foregoing by not expanding the program, which provides health care for low-income and the disabled.
Missouri House Speaker Todd Richardson, R-Poplar Bluff, made clear in his comments after the governor's address that any proposal to expand Medicaid would get nowhere.
In fact, Richardson said, “He did nothing to talk about the skyrocketing cost of our Medicaid program.”
Even without the ACA-recommended expansion, the speaker said, Missouri’s Medicaid costs are up 15 percent over the past 18 months. State budget director Dan Haug told reporters that the increase was caused, in part, by the rise in prescription drug costs.
Senate Appropriations Committee chairman Kurt Schaefer, R-Columbia, contended that about 100,000 more Missourians have been added to the Medicaid program just over the past year. Schaefer, a candidate for Missouri attorney general, said that close to 1 million Missourians -- or close to one-fifth of the population -- is now on Medicaid. He said that number was "unsustainable."
Richardson and Schaefer said they also were concerned about Nixon’s supplemental budget request for the current fiscal year that totals more than $400 million.
Governor focuses on past
Nixon’s most dramatic comments in his address included calls for the General Assembly to approve an anti-discrimination measure that would bar employers from firing workers just because they are gay, and yet another pitch for legislators to put in place more ethics restrictions on themselves and other public officials.
Part of his speech had a nostalgic feel as the governor recalled his early days in the Missouri Senate, back in the 1980s, and cited some of his achievements during his seven years in office.
As in his recent interview with St. Louis Public Radio, Nixon cited four goals that he believes he’s achieved, to improve the state’s economy, increase education, make college more affordable and improve healthcare.
The proposed budget for FY2017 calls for roughly $600 million in new spending, compared to the current fiscal year. Projected general revenue is estimated to be up 4.1 percent, for a total of about $9.3 billion. That compares to $8.9 billion for the current fiscal year.
The new budget stipulates a cut of 48 state jobs, but Missouri budget chief Haug said the trims would be achieved through attrition. No layoffs are expected.
Since Nixon took office in 2009, Haug said, he has cut the state government workforce by more than 5,100 jobs.
The governor's proposed budget calls for a two-percent pay increase for state workers, and proposes more state spending on their health insurance so that the workers' share of their premiums doesn't increase.
Among other things, his budget calls for a six percent increase in spending for higher education. He said the state's public universities and colleges, four-year and two-year, had agreed to forego any tuition hikes, in exchange.
It will be up the General Assembly to decide how much of Nixon’s recommendations will be included in the budget that legislators will put together and send to the governor’s desk by early May.
The new budget assumes that the state will lose some general revenue as the first phase of tax cuts approved two years ago begin going into effect Jan. 1, 2017.
The proposed budget also takes into account an expected loss of $10 million in state income because of the move of the Rams professional football team to Los Angeles. The loss largely comes from taxes on the players’ salaries and other state income generated by the team, Haug said.
Republican response muted
Republican lawmakers, who hold huge majorities in the state House and Senate, offered a muted response. The biggest cheers came at the introduction of the governor's wife, Georganne Nixon. Republicans did applaud when the governor praised Richardson for focusing on more ethics regulations.
Several of the Republicans vying to replace Nixon as governor also weighed in. St. Louis businessman John Brunner contended that the governor was glossing over real state problems.
"Our roads have deteriorated past the point where we can no longer make even the basic repairs, businesses and people are moving from the state at a quickened pace, our children are falling behind in education, our higher education system has become a national laughingstock, and our urban cores are crumbling," Brunner said in a statement. " This failure of leadership is unacceptable and Missourians deserve better."
Another GOP candidate, former House Speaker Catherine Hanaway, asserted, "Skyrocketing murder rates in St. Louis and Kansas City, uncontained riots in Ferguson and lawlessness at the University of Missouri have placed a negative stigma on our great state. Rudderless economic policy has left us lagging behind our neighbors and the rest of the country, with Missouri ranking 42nd in the nation in employment growth, 43rd in per capita GDP growth, and 37th in per capita personal income growth in the last decade...."
Lt. Gov. Peter Kinder, who's also among the crowd of Republicans competing to succeed Nixon, tweeted several criticisms of the governor's remarks while Kinder sat behind Nixon. Among them: "RETWEET if you're excited this is Governor Nixon's #LastSOTS."
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