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ANALYSIS: Missouri budget spends more despite flat revenues

Sunday, May 11, 2014 | 7:48 p.m. CDT; updated 8:00 p.m. CDT, Monday, May 12, 2014

*Correction: JEFFERSON CITY — In a story Sunday about the Missouri budget, The Associated Press, relying on information from the Senate Appropriations Committee, erroneously reported the number of "new budget items" there are in the 2014 budget. There are 338, not 252.

JEFFERSON CITY — Missouri tax revenues have been falling in recent months. Yet, spending is on the rise in the Missouri Legislature.

The 2015 budget, which won final legislative approval this past week, includes hundreds of spending increases for everything from schools to prisons. There's new money for iPads, heart defibrillators, buildings and the eradication of pesky fish.

The number of new spending items included in the 2015 budget is nearly one-third higher than the current year, according to an analysis prepared by the Senate Appropriations Committee at the request of The Associated Press.

In summation: There has been an increase in the instances of increased spending.

This, from a Republican-led legislature that has generally denounced the growth of government and at a time when revenues have been falling short of projections. Yet legislative leaders remain outwardly confident that everything will work out.

"We put together a budget that we felt was accurate with the revenue estimates we had at the time, and we still believe that will come true," said House Budget Committee Chairman Rick Stream, a Republican from Kirkwood.

The reasons for Missouri's spending surge date back to last summer, when Missouri ended the 2013 fiscal year with a surprising 10 percent growth in state revenues. That meant the state started the 2014 budget with more money than expected in the bank, which fueled discussions of how to use it.

Lawmakers then met with economists and members of Gov. Jay Nixon's administration in December — as they do each year — as the first step in deciding how much money to expect for the 2015 budget. But unlike most years, there was no agreement.

Legislators projected that the state would end the current fiscal year in June with 2 percent growth and see an additional 4.8 percent rise in revenues during the annual budget year that starts July 1. Legislative leaders said they were being realistic. Nixon said he was more optimistic. The governor forecast revenue growth of 2.8 percent this year and an additional 5.2 percent growth for the 2015 budget.

"Right now, both of us are wrong," Stream acknowledged this past week.

State revenues have fallen in three of the past four months and, as of the end of April, were up just 0.5 percent through the first 10 months of the 2014 budget year.

Senate Appropriations Committee Chairman Kurt Schaefer cited the uncertain revenues as one reason why lawmakers opted for long-term debt to finance a new mental health hospital in Fulton instead of short-term bonds that would have required substantially higher annual payments.

"We're being very cautious watching revenues right now," said Schaefer, a Republican from Columbia. Yet he also touted "a massive increase of real money" for public schools in the 2015 budget — up nearly $115 million more than the current budget.

The 2015 operating budget contains 332 "new decision items," which include spending increases for existing programs as well as entirely new initiatives, according to the Senate Appropriations Committee. That's up from *338 "new decision items" in the 2014 budget.

More than 100 of those "new decision items" were in play as House and Senate negotiators met this past week to resolve differences between budget versions previously passed by the two chambers. Lawmakers opted for the larger dollar figure on those new spending items about three times as often as they picked the smaller amount, according to a Associated Press tracking of the budget negotiations.

Even with those spending increases, the budget still is smaller than the one originally proposed by Nixon. It now will be up to Nixon to decide whether to cut any of the legislative spending proposals.

House Speaker Tim Jones called the Legislature's final product "a true balanced budget" that reflects "careful fiscal planning and stewardship."

Rather than pare back spending because of the recent downturn in revenues, Stream said lawmakers chose to base the budget on the revenue projections they developed during the winter.

"Most people ... believe that the economic situation is going to be improving," Stream said. "And I hope it does."


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Comments

Richard Saunders May 12, 2014 | 9:58 a.m.

What a joke. Our future depends upon lawyers who "believe that the economic situation is going to be improving."

I wonder, what will they believe once the Not-Federal, Not-Reserve banking system holds title to ALL property? Why? Because they are the only entity that is experiencing growth (much like cancer).

http://research.stlouisfed.org/fred2/ser...

From $900B to $4.3T in only FIVE AND A HALF YEARS.

Yet they all pretend not to understand why the rich are getting richer, while the poor are getting poorer.

(Report Comment)
Ellis Smith May 12, 2014 | 11:16 a.m.

Well Richard, I spent 15 years, on and off, in the asbestos litigation wars. As a condition (mine) that I would not agree to take the witness stand or (more frequently) give a deposition without first having a meeting with the attorney who would be representing me, I've sat through many dinners in expensive restaurants around the United States at which those discussions were held.

Those meetings COULD just as well have been held in the law firm's office, sans the large restaurant/bar tabs, but the attorneys wouldn't hear of it; after all, they just sent the tabs to their clients.

And the most humorous (assuming you want to call it that) feature was that those attorneys were ALWAYS defendant's attorneys, meaning their firm got paid no matter who ended up winning the lawsuit.

But what the hell, Richard, I'm easy. :)

I can tell you "litigation" stories that would make your hair stand on end.

(Report Comment)
Michael Williams May 12, 2014 | 2:45 p.m.

Ok, I've read this story 3 times and all I can conclude is: What weird writing!!!

First, the article says, "spending is on the rise in the Missouri Legislature", yet I can't find a single place in the article that says spending has increased by ANY amount or even HOW MUCH!

I DO find this: "There has been an increase in the instances of increased spending."

What does THAT mean? Does it mean that if I have 10 bills that need paying last month, and 15 bills that need paying THIS month, that I've seen a 50% increase in instances of increased spending?

So what? I want to know if going to 15 bills to pay means more dollar payout than the original 10 bills! One doesn't necessarily follow the other, does it?

Why write it in this way?

And, buried towards the end of the article is the statement: "Even with those spending increases, the budget still is smaller than the one originally proposed by Nixon."

What's going on, Missourian? Where is the ACTUAL dollar amount of spending increase? Did you have to search long and hard to find that the increased NUMBER of items is the REAL story. Is there a bias here?

It may be true there is more spending in store. If so, why didn't you say so and give us the number? Why is the "number of items" the story here, when in fact the number of items can have LITTLE to do with HOW MUCH?

I don't get it. Please explain, Missourian, because so far your story is just curiouser and curiouser.......

(Report Comment)
Ellis Smith May 12, 2014 | 3:28 p.m.

Michael:

I noticed that too, but was more interested in adding to Richard Saunders' AM comment.

Math homework for Monday evening:

My expenses for item X for the first third of 2014 WERE EXACTLY $0.00. For May thusfar they have ALREADY been $1.00. Express that change correctly as a PERCENTAGE INCREASE, keeping in mind that the denominator to be used is zero.

Doesn't tell us what they might have been expected to be either, does it?

And here I thought President Reagan and his fiscal advisors were the only ones ever accused of "voodoo economics." Please pass me one of those hat pins; I already have a stuffed doll. Got any spare chicken blood?

(Report Comment)
Michael Williams May 12, 2014 | 4:11 p.m.

No, Ellis.....I don't do denominators that are zero. Why, just last week I made my most recent effort to mesh Einstein's general theory of relativity with quantum mechanics using only my fingers, toes, and an abacus...and, damn it all.....I got infinity as an answer AGAIN!

"Infinity" gets tiresome...over and over...so I don't appreciate you trying to trick me into a zero denominator. Pick an irrational number, tho, and I'm sure any number of other posters (and Missourian columnists) can help you out....them being exceptionally familiar with the concept and all.

;^)

PS: This column gets weirder and weirder every time I read it.

(Report Comment)
Ellis Smith May 12, 2014 | 8:50 p.m.

Michael:

Einstein isn't a problem, but that damned Heisenberg and his uncertainty principle definitely is one.

If we told him once we must have told him a 100 times: we said, "Werner, baby, you HAVE to be more certain."

Scientific notation is very handy when dealing with very large numbers or very small numbers (the latter as decimal fractions). Our growing national debt has reached the point where expressing it numerically requires use of scientific notation. And then there's Avogadro's Number, which our chemical engineers refer to laughingly as "Avocado's Number." [#@$%& people from MS&T! No respect at all!]

(Report Comment)

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