Nixon announces $60 million in new budget cuts
This article first appeared in the St. Louis Beacon, Aug. 21, 2009 - Gov. Jay Nixon released late Thursday a list of $60 million in additional Missouri spending restrictions -- necessary because of the continued decline in the state's income, compared to the Legislature's projections when its members drew up the budget earlier this year.
The trims are in addition to $430 million in Nixon's June cuts or spending restrictions. Spending restrictions are technically called "withholdings" because the money might be released if state income improves.
State Budget Director Linda Luebbering has been pessimistic about the prospect of better financial days, which means the "restrictions'' may likely never be restored.
In July, for example, the state government borrowed $125 million from the state's Rainy Day Fund, which had more than $500 million, to help with cash flow.
The state's income for the 2009 fiscal year that ended June 30 ended up being 7 percent below that of the 2008 fiscal year -- and closer to 10 percent below what had been initially projected for 2009.
Of the new cuts for this 2010 fiscal-year budget, the largest chunk -- $16 million -- came from the budget of the Missouri Department of Social Services.
The Missouri State Workers Union, which represents thousands of the department's employees and held a recent anti-cut rally, said late Thursday that it "is calling on Missouri’s elected leaders to consider balanced solutions to Missouri’s revenue problems.
"Demand for assistance at the Department of Social Services is at record levels,'' the union said. "Last year, for the first time ever, 1 million Missourians were covered by food stamps.
"The painful cuts to the state budget in 2005 that resulted in thousands of low income Missourians being kicked off of Medicaid caused harm to many families, but did not put Missouri on the path towards fiscal responsibility. This round of budget cuts won’t either.
The union said that the state's elected officials need "to face the facts: in Missouri, our state government does not raise enough revenue to meet the basic needs of our citizens."
The $60 million list released by the governor calls for the elimination government-wide of 200 more state jobs (in addition to 300 job cuts announced earlier), and the use of federal stimulus money to soften some of the cuts. Most of the job cuts appear to be through attrition, not filling already vacant posts, or through hiring freezes.
For example, in the Department of Social Services, $4.7 million in federal stimulus money will be used to offset some of the $8.5 million trimmed from state's allocation of $66.8 million for child-care services.
Among the more popular cuts used to assemble the $60 million: "non-mandatory travel'' and reimbursements for such items as Missouri Bar dues for state lawyers. The trims also call for eliminating the contract of almost $500,000 with TALX, a firm that specializes in employment and income verification for prospective hires.