Missouri spending plan creates choices between seniors, children

Missouri lawmakers passed a nearly $25 billion budget Thursday that could force Gov. Jay Nixon to choose between funding for developmentally disabled children and low-income seniors.

The spending plan for the next fiscal year won final approval in a cloud of controversy after House and Senate budget negotiators made a last-moment switch in the funding source for several politically popular programs. Their acknowledged intent was to pressure Nixon into signing a separate bill that eliminates a tax-credit for low-income home renters – something the governor originally proposed but upon which he has since parsed his position.

Nixon did not take too kindly to the maneuvering. He issued a written statement Thursday calling the budget plan “a cynical attempt to pit children with developmental disabilities … against low-income seniors.”

The governor can wait until the budget's July 1 effective date to decide whether to sign or veto the dozen-plus budget bills. He also can veto any of specific expenditure lines contained in them.

The budget would increase Missouri's total spending authority by more than 3 percent compared to the current year. It adds $66 million to the $3 billion core budget for public elementary and secondary schools, and it gives public colleges and universities a $25 million increase to be distributed based on whether they meet performance criteria such as student retention and graduation rates. State employees also would get a small raise.

House Majority Leader John Diehl, R-Town and Country, declared it a “responsible and accountable budget to the taxpayers.”

When Nixon outlined a budget plan in January, he assumed almost $57 million of savings from the recommended repeal of a tax break for more than 100,000 low-income seniors and disabled residents who live in rental housing. Nixon proposed to redirect that money to mental health care, nursing homes and home-based health and living services that could benefit the disabled and seniors.

But last month, Nixon said he would veto the tax break repeal for low-income renters if it wasn't part of a “broad-based and balanced” overhaul of Missouri's many tax credit programs that have put a financial strain on the budget.

The House gave final approval Thursday to a bill repealing the tax break for seniors and disabled renters, but separate legislation that would revamp Missouri's other tax credit programs still faces hurdles before the legislative session ends May 17.

Because of the uncertainty, legislative budget writers made a last-moment switch this week that would use money from the repealed tax break to help fund early childhood special education, the First Steps program that serves developmentally disabled preschoolers, health care for the blind and medical clinics that serve low-income residents. The intent was to pressure Nixon into signing the tax-break repeal for seniors and the disabled, even if the broader tax-credit overhaul fails.

“He's going to have to make a decision when we present the bills to him. Does he want to help the kids with special needs or not?” said House Budget Committee Chairman Rick Stream, R-Kirkwood. He added: “I do think we've got a lot of leverage.”

But not all lawmakers were pleased with that leverage.

Several senators stalled a final vote on the budget for a few hours Thursday. Among other things, they raised a technical point that neither the House nor Senate had made the children's programs dependent upon the tax-break repeal when passing prior drafts of the budget, so a conference committee of House and Senate members should not have been able to make that switch when preparing a final version.

Opponents said the budget could jeopardize the First Steps program, which the state education department says serves more than 5,000 children.

“We are putting these kids on the line for something that everybody in the room knows is not likely to happen,” said Sen. Ryan Silvey, R-Kansas City, a former House budget chairman.

Silvey dropped his opposition when Senate leaders pledged to craft a solution next week that would ensure the children's programs get funded. But Stream later told reporters that he was unaware of any deal for a post-passage budget patch.

Nixon called the contingent funding for children's services “especially problematic and irresponsible” given that lawmakers also passed a construction and maintenance budget Thursday that includes $38 million for a new office building in Jefferson City.

“Building new offices for bureaucrats at the expense of children with developmental disabilities and low-income seniors reflects the wrong priorities,” Nixon said.

The governor also has criticized another budget maneuver, which attempts to provide just eight months of funding for the vehicle licensing division of the Department of Revenue. Republican budget leaders have said they will provide the rest of the money next January if the agency stops making electronic copies of license applicants' personal documents such as birth certificates. Nixon has said he would treat the budget literally, as a one-third reduction in the agency's annual allotment, and would lay off employees and cut services accordingly.

Associated Press writer Chris Blank contributed to this report.