Thousands of disabled and elderly Missourians may have narrowly avoided losing assistance for in-home and nursing home care Thursday night, after lawmakers struck a deal on the state’s $27 billion budget.
Their fate is now in the hands of the Missouri House.
Legislators gave final approval to the state budget after hours of debate Thursday, including a funding hike for public education and a steep cut for colleges and universities.
But the biggest fight of the day focused on state aid for the elderly and disabled.
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Gov. Eric Greitens’ proposed budget called for saving $52 million by requiring people to display more severe disabilities to qualify for in-home care or nursing home services. The result would have been 20,000 people losing state aid.
The House reversed the cut in its version of the budget, paying for in-home and nursing home care by passing a bill ending a property tax credit for low-income seniors who rent their homes.
A Democratic filibuster ensured that the tax credit repeal could not pass the Senate. So budget negotiators tried to strike a compromise: Half the cuts would be rolled back, but the other half of the cuts would remain unless the Senate repealed the senior citizen property tax credit.
The result of the compromise: Nearly 8,000 people would lose assistance.
But instead of repealing the credit — which Democrats argued would simply be pitting low-income senior citizens against each other — the Senate took another path Thursday.
Sens. Ryan Silvey, a Kansas City Republican, and Kiki Curls, a Kansas City Democrat, proposed authorizing a review of special state funds to find excess money that could be used to raise $35.4 million and avoid the cuts to in-home and nursing home care.
“This is a one-time thing,” Curls said. “It would not happen every year.”
A group of Republican senators balked at the plan, saying using one-time money to fund an ongoing program is simply a budget gimmick. They pressed for the Senate to follow through with the elimination of the senior property tax credit.
Renters can qualify for the tax credit if their income is less than $27,500 a year if single or $29,500 a year if married. Roughly 100,000 Missourians take advantage of the credit, with the average credit being around $500.
But the concerns of critics fell on deaf ears, and the Senate voted overwhelmingly to go with Curls’ and Silvey’s plan.
The House still needs to approve the idea before the legislature adjourns at 6 p.m. May 12. If it doesn’t, the cuts that result in 8,000 people losing state aid would go into effect.
Among the other highlights of the budget approved Thursday:
▪ K-12 public schools received $48 million more than they did this year, bringing total education spending to $3.4 billion. That will fully fund the education formula for the first time ever.
▪ Funding for Missouri’s public colleges and universities was cut by 6.6 percent. The House wanted to cut the University of Missouri System even deeper, suggesting a 9 percent cut. But the Senate insisted cuts be equal for every university.
▪ The Missouri State Employees Retirement System, commonly known as MOSERS, received $45 million in additional funding. The House suggested a $15 million funding bump, but Senate leaders worried that underfunding the state’s pension fund could have long-term negative impacts on the state’s budget.
▪ The number of inspectors employed in the Missouri Department of Labor was cut from 11 to nine. The inspectors enforce state labor laws, such as the minimum wage and child labor restrictions. The budget also cuts eight administrative law judges from the department’s budget. The judges adjudicate workers compensation and other labor cases.
▪ A $3 million buyout program for people living within 3 miles of a radioactive waste site near St. Louis was cut to $1 million.
“This has been a tough budget year, as everybody knows,” said House Budget chairman Scott Fitzpatrick, a Shell Knob Republican. “There’s going to be a lot of cuts not everyone is going to love. But that being said, our job is to pass a balanced budget.”
Lawmakers entered the year facing a huge budget shortfall, with state revenue lagging far short of the level needed to fund the budget passed by lawmakers last year. As a result, Greitens and his predecessor, Gov. Jay Nixon, were forced to cut more than $300 million from this year’s budget.
Fitzpatrick said growing spending on Medicaid, the federal health insurance program for the poor and disabled, has put a strain on the state’s finances. In fiscal year 2006, he noted, Medicaid cost the state $1.2 billion. This year it will cost nearly $2.2 billion.
Adding to the budget woes is the fact that in 2015, lawmakers voted to allow corporations to exclude income made in out-of-state sales or services from their Missouri corporate income taxes.
That legislation, which received bipartisan support at the time, was supposed to cost the state $15 million. But it actually has cost the state more than $200 million in corporate tax collections.
That $200 million reduction is on top of a $127 million phase-out of the corporate franchise tax approved in 2011.
The tough budget picture was compounded when Greitens was two weeks late getting his budget proposal to the legislature. That shortened the timeline for lawmakers to finish their work.
The fact that the Senate has been roiled with infighting among Republicans that has largely paralyzed the chamber made many wonder if the legislature would be able to finish its work on the budget before the constitutional deadline of 6 p.m. Friday.
But the logjam finally broke by Thursday, and both the House and Senate were able to send the budget to Greitens. He must now approve or veto the various budget bills before they go into effect July 1.
“We’ve had to make some tough choices,” said Senate Appropriations Committee chairman Dan Brown, a Rolla Republican. “But you play the cards you’re dealt.”