Looming budget struggles paint bleak future for Missouri

Thursday, December 4, 2008 | 11:58 a.m. CST; updated 3:35 p.m. CST, Thursday, December 4, 2008

The trouble with news is that so much of it is true. If I've said that before, my excuse for repetition is this week's headlines.

"Nixon will face big budget shortage" was on the Missourian's front page Wednesday. Inside that day's paper was an Associated Press story headlined "Report fails 49 states for education costs." Missouri is one of the 49 to flunk. In Tuesday's Maneater, the top story was "Missouri Promise faces grim budget realities." Then the bomb. From the Missourian's Web site on Thursday: "University leaders asked to envision budget cuts of up to 25 percent."

Twenty-five percent? That can't be serious. It turns out, however, that the chairmen of the legislative budget and appropriations committees are deadly serious.

Last week's sermonette was an expression of relief at not being responsible for drafting our university's budget in these uncertain times. This week's news forces the realization that, really, nobody's off the hook. We might not have the burden of planning the budget, but none of us — students and wannabe students, parents, university employees and retirees, citizens, taxpayers — will escape the impact of the recession and state government's response to it.

Wayne Goode, adviser to the Governor-elect, former legislator and perhaps Missouri's most experienced budget builder, warns that the revenue shortfall for the current fiscal year, which stands now at $342 million, reminds him of the Great Depression. Mr. Goode, as I've observed him over the years, is not given to hyperbole.

Now take a moment to reflect on how our rulers in Jefferson City have responded to less apocalyptic downturns in the recent past. Gov. One-Term Bob Holden withheld appropriated funds from the public schools. The Boy Governor, our current one-termer, slashed the Medicaid roles. The university's appropriation is still below what it was in 2001.

Already, the Republicans who control the legislature have warned that there's no money even to restore the Medicaid cuts, let alone support new programs.

So Governor-elect Jay Nixon's "Missouri Promise" — his plan to provide scholarships for community college and university educations for good students who can't afford college now — seems almost certain to be a promise unkept. And that's just one of those "grim budget realities."

For our university, the grim realities suggest that "Compete Missouri," the three-year program of salary increases intended to raise faculty pay from the bottom to the middle of our peers, loses the competition for diminishing dollars. And that was the case when the projection was a mere 5 percent budget cut. At 15 to 25 percent, the range now under discussion, even the system-wide hiring freeze won’t save nearly enough to satisfy our legislative masters.

Administrators are banking on another enrollment increase next fall to produce some of the income the legislature won't deliver. The economics of that are simple. If you have 20 or 200 students in a classroom, there's little or no extra cost for adding another one or 20. So the tuition revenue, or most of it, goes to the bottom line.

In years past, the university could more fully counteract the legislature's stinginess by raising tuition steeply. Hence our failing grade in affordability and the need for that Missouri Promise. Senate Bill 389, which limits the increases to the rate of  inflation as measured by the Consumer Price Index, took away that option. Legislators didn't, of course, commit to making up the difference.

You can see why Mr. Nixon joined the throng of mendicant governors imploring President-elect Obama to direct some bailout money to the states. The feds can borrow, run deficits and just print more money. The state is constitutionally bound to balance its budget.

In a town where the two biggest employers are the university and the public schools, the budget news is all too true. Please don't shoot the messenger.

George Kennedy is a former managing editor at the Missourian and professor emeritus at the Missouri School of Journalism.

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Ayn Rand December 5, 2008 | 6:45 a.m.

Good luck crying poverty when skeptical taxpayers set on campus and see the Taj Mahal rec center, the Taj Mahal Brady Commons expansion, a new arena that's a stone's throw from the old one that hasn't even been paid off, the new hospital parking garage that's bigger than Hallsville and . . . you get the point. Or at least I hope you do.

(Report Comment)
Ellis Smith December 5, 2008 | 9:05 a.m.

Ayn Rand's point is well taken, and some of those who are most dissatisfied with the Taj Mahal edifices here in Columbia are faculty members at MU. Perhaps they see them as a daily reminder of just how misplaced MU's priorities really are.

One cannot read these woe-is-us editorials without a smile. To read them one would think that poor old MU is the ONLY campus of this university system with financial problems. Waa! Waa! Waa! There are three other campuses, and they have in total 56% of the system's students. Fifty-six percent? Isn't that also called a majority?

(Report Comment)
Ayn Rand December 5, 2008 | 9:15 a.m.

Unless those three campuses band together to promote their individual causes, it's not a politically effective majority.

(Report Comment)
Jay Lamb December 8, 2008 | 12:08 p.m.

I must agree and disagree respectively. In these times the University as well as all institutions which receive public monies has a duty to spend that money responsibility, this is really a trust that the leadership should keep in the forefront at all times, not just these hard economic times. I believe that public institutions such as MU often are unfairly scrutinized when it comes to their spending habits, especially from the private business sector. Somehow a CEO that runs a private company into bankruptcy is still worthy of a 20 million dollar salary and bonus for the good job they have done while a professor drawing $150,000.00 to educate tomorrows leaders is paid way to much for what they do, I hear it all the time. Another way this happens is the selective facts folks chose to discuss in public forums. The Taj Mahal recreation center and Brady expansion began well before economy took such a violent nose dive. In addition both of the construction projects were student driven, the was a referendum voted on by students to voluntarily increase recreation fees collected from students to pay for the construction costs. In short both projects are being built without tax payer money and will be supported and maintained by user fees. The parking structure that is bigger than Hallsville is paid for out of the parking trust, again not taxpayer money and they will be maintained by user fees. As for the arena I can not speak for exactly how it is funded however I thought that the athletic department generated their own revenue and operated outside of public money the same way residential life does, but I don’t know. All that being said it does not relieve the University of acting responsible and policing its spending habits, that being said a President with a strong business background such as Forsee’s should benefit the University, time will tell.

(Report Comment)

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