JEFFERSON CITY — Missouri now has a projected $342 million shortfall for the current fiscal year, a number that could curb the spending initiatives proposed by Missouri's governor-elect.
Along with Tuesday's announcement that the state's economy is facing severe money troubles, the budget adviser for Gov.-elect Jay Nixon, former state Sen. Wayne Goode, gave a grave warning for the state's future.
Goode said the state faces a budget crisis "like none we have ever seen in the past."
Goode, who served as chair of both the House and Senate appropriations committees during his decades in the state legislature, gave a dire warning about the state's economic picture. In 2005, when Goode retired from Missouri's General Assembly, he was the senior minority leader of the Senate Appropriations Committee.
He likened the national economic picture to the Great Depression of the early 20th century, a forecast that could affect the state's financial future.
This shortfall is a departure from just six months ago, when the state had an anticipated surplus of $281 million. Since May, the state's revenues have declined, resulting in a $623 million general revenue decrease.
Goode's comments to reporters came on the same day the state Office of Administration reported that tax collections had fallen 3.9 percent for the past five months of the current fiscal year compared to last year.
Nixon will take office Jan. 12, and his transition team has already been working with outgoing Gov. Matt Blunt's office to prepare for the switch in the state's top elected office. During a conference call, Goode said Nixon's office will unveil a series of proposals to limit the state's spending in light of the budget concerns. Goode did not specify which spending areas would be limited and which would be preserved.
Goode said one reason for the state's shortfall is continually declining employment as well as a loss of confidence by consumers and businesses in the state's economy.
Goode, a Democrat from St. Louis County, also said that because the national recession is so unpredictable, it's difficult to maintain a consistent revenue estimate for the state. But he suggested there could be an effect on state spending during the current fiscal year, which started in July and runs until June 2009.
"We're all aware that we have to operate from a balanced budget standpoint," Goode said. "I think you can assume that there will have to be some adjustment of expenditures in the current year's budget."
Following the conference call, Nixon released a statement, but he did not outline any specific cuts or changes to his priorities based on these budgetary shortfalls. In his statement, he called Missouri's economic challenges "historic" and called for a bipartisan effort to "make government more efficient, more effective and more responsive to Missouri families."
Nixon met Tuesday with President-elect Barack Obama, Vice President-elect Joe Biden and fellow U.S. governors at a conference of the National Governors Association in Philadelphia.
"The president-elect clearly understands the pain that families are feeling, and he has indicated that his administration will work aggressively to pass the type of economic stimulus package that will help us move Missouri forward," Nixon said in a news release.