UPDATE: Gov. Nixon proposes $430 million in budget cuts

Thursday, June 25, 2009 | 4:05 p.m. CDT; updated 4:18 p.m. CDT, Thursday, June 25, 2009

JEFFERSON CITY — Gov. Jay Nixon vetoed $105 million from Missouri's budget Thursday and placed on hold an additional $325 million of expenditures as the state faces declining revenues.

Among the project funding delayed but not canceled is $31 million for a new Ellis Fischel Cancer Center at MU. A state senator from Columbia had been airing radio commercials and running automated telephone calls urging his constituents to lobby the governor not to veto the project.

The next phase in the process is to involve Nixon providing a timeline for when the funds will be released, according to a news release. UM System President Gary Forsee issued a statement declaring his disappointment, noting that with no guarantee the money will be forthcoming, all planning for the new cancer center must come to a halt.

Nixon proclaimed the line-item vetoes a "near-record" amount for Missouri, putting them in the context of a state unemployment rate which is at a generational high.

"Just as Missouri families are required to tighten their belts, so too must state government," Nixon said at a Capitol news conference.

Legislators passed a $23 billion operating budget for the fiscal year beginning July 1, plus a two-year, $600 million capital improvements bill that includes various projects funded with federal stimulus money.

Nixon's spending reductions hit both the operating and capital improvements bills.

The cuts come as Missouri's tax revenues have declined by more than state officials had forecast. Without spending cuts, Nixon said, it's unlikely the state can meet its budget.

The line-item vetoes include portions of the money budgeted for a new emergency responder radio system, college construction projects, ethanol plants subsidies and a Medicaid rate increase for dentists. Also vetoed was funding for a new highway interchange in Jefferson City that lawmakers said was necessary to help redevelop the site of the former Missouri State Penitentiary.

Line-item vetoes eliminate the spending authority for particular programs in the state budget. But governors can also leave items in the budget and withhold or delay the actual release of money when the state faces financial difficulties.

"This near-record of line item vetoes was not made lightly," Nixon said. "These fiscally responsible steps are necessary to ensure that Missourians have a government we can afford without raising taxes and without sacrificing our shared priorities of education, health care and jobs."

Nixon said he is imposing $60 million of expenditure restrictions on state agencies, contracts and grants. He said that includes the elimination of 200 state jobs on top of the 1,244 positions eliminated in the budget passed by legislators.

Also placed on hold is $50 million for a new state incentive fund for high-tech battery makers, about $48 million in maintenance and repair for state buildings and a $21.5 million rate increase for in-home care providers.

Various projects at veterans homes and the Department of Natural Resources also were placed in the category of restricted expenditures, as were about $91 million worth of college construction projects that escaped a straight veto.

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