UPDATE: Missouri House funds education, cuts blind benefits

Thursday, March 22, 2012 | 5:40 p.m. CDT; updated 10:34 p.m. CDT, Thursday, March 22, 2012

JEFFERSON CITY — The Missouri House passed a $24 billion state budget plan Thursday that holds funding steady for education but cuts medical benefits for the blind — a tradeoff decried by the governor that may get undone in the Senate.

Lawmakers are grappling over which services to finance or slice because Missouri's revenues have yet to rebound from the recent economic recession, and broad-based tax hikes have been ruled out by both the Republican-led legislature and the Democratic governor.

When he delivered his State of the State address in January, Gov. Jay Nixon proposed to balance next year's budget by cutting $106 million from public colleges and universities, which would have reduced state aid to its lowest level since 1997. Nixon later softened that stance by proposing to redirect $40 million to higher education from Missouri's share of a nationwide settlement with mortgage lenders.

The House budget plan undoes the rest of Nixon's proposed cut, providing public colleges and universities with the same amount they got this year.

To help pay for that, the House plan eliminates a $30 million program that provides medical care to 2,858 blind residents who earn at least $9,060 a year, which is too much to qualify for the state's traditional Medicaid health care program. Instead, the House budget provides $6 million for a new, slimmed-down blind aid program — financed largely by the repeal of a sales tax exemption on the supplies and equipment used to publish newspapers.

"Clearly, the priority reflected in this budget is education," said House Budget Committee Chairman Ryan Silvey, R-Kansas City, who has been targeted with radio ads by opponents of the blind aid cuts. "The governor has come year after year and asked us to cut education, and we're done with that."

Silvey said the budget merely puts the blind on equal footing with other people with disabilities who do not have a specialized state health care plan. The blind still would receive a $707 monthly grant from the state.

Nixon has called the proposed cut to the blind aid program "dead wrong." But Nixon's administration did not offer any specific suggestion to fellow Democrats for an amendment that would have cut the budget elsewhere in order to restore the blind benefits, said Rep. Sara Lampe, of Springfield, the ranking Democrat on the House Budget Committee.

Senate President Pro Tem Rob Mayer, R-Dexter, has said his chamber will reverse the cut to the blind benefits. But Senate Appropriations Committee Chairman Kurt Schaefer, who wants to spare higher education from cuts, remains uncommitted on whether his panel will restore the blind health care program.

"It's time that all programs are looked at to evaluate who has taken their share of the cuts and who hasn't," said Schaefer, R-Columbia.

The budget also could run into a roadblock erected by state Sen. Jason Crowell, R-Cape Girardeau, who has vowed to oppose one-time funding sources for the budget, including the diversion of mortgage settlement money. Crowell also opposes bills that would generate money by allowing the Department of Revenue to garnish the bank accounts of people who owe taxes, and by waiving interest and penalties for delinquent taxpayers who pay up during a special amnesty period.

The House budget plan adds a single dollar to the $5 million increase that Nixon proposed for Missouri's $3 billion funding formula for public elementary and secondary schools. The governor and lawmakers touted that as Missouri's largest-ever budget for basic aid to schools. Yet it falls $416 million short of the amount called for by the funding formula, according to the Department of Elementary and Secondary Education.

Some Democratic lawmakers complained that the school budget is inadequate. They bemoaned the fact that colleagues were unwilling to consider other ways of generating money, such as raising Missouri's lowest-in-the-nation cigarette tax or revamping laws to better collect Internet sales taxes.

"We are falling woefully short on those priorities. We should be using this budget to plan for our future," said Rep. Margo McNeil, D-Hazelwood. "We are really just trying to survive. We are paddling to catch a breath as we go under water, and it is of our own making."

For the first time since the 2009 fiscal year, the House budget plan would offer a pay raise to some state employees. Those earning less than $70,000 would get a 2 percent raise when the budget takes effect July 1. Nixon had proposed a 2 percent raise for all employees to take effect Jan. 1.

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