Holden delivers State of the State Address

Wednesday, January 21, 2004 | 12:00 a.m. CST; updated 3:28 a.m. CDT, Thursday, July 10, 2008

JEFFERSON CITY, Mo. (AP) -- Declaring Missouri's economy sound but its school system in jeopardy, Gov. Bob Holden renewed his call Wednesday for new taxes and revenues while blasting Republican lawmakers for cuts that "endangered the future of countless children."

In a State of the State address foreshadowing his re-election campaign, the Democratic governor pressed his case as the protector of education and the encourager of an improving economy.

Holden proposed a roughly $19 billion budget built on the assumption of higher taxes on tobacco products, casinos and the wealthy, as well as the elimination of tax "loopholes."

It was the same remedy Holden proposed last year for the state's budget woes -- the same plan the Legislature's Republican majority rejected and has generally vowed to oppose again.

"After a decade of investment and progress, you passed last year's education cuts twice over my veto with a great flourish of bravado," Holden said. "If last year's education cuts are allowed to stand, all of these gains are in great jeopardy.

"There is nothing moral in raising standards and expectations at a struggling school, only to deny the necessary funding," Holden added. "Look at this through a child's eyes -- first we encouraged them to dream, then we denied them the means. That's not bravado. That's just cruel."

Democratic lawmakers rose from their seats with thunderous applause; Republican lawmakers sat in silence -- a division seen repeatedly as Holden pressed on with similar accusations.

In an unusual break from decorum, House Speaker Pro Tem Rod Jetton, of Marble Hill -- the second ranking Republican in the House -- interrupted Holden with a heckle from the back row of House chamber.

"Release the money governor!" yelled Jetton, referring to Holden's withholding of education money appropriated by legislators. The governor contends the move was necessary because the GOP budget was unbalanced.

After Jetton's interjection, Republican House members rose with applause and Democrats sat silently. Holden continued to talk, making no acknowledgment of the outburst.

Jetton later defended his actions to reporters, saying he was frustrated by what he called Holden's false accusations and owed the governor no apology.

If his plan were to find legislative favor this year, Holden wants to place most of the tax proposals on Missouri's August ballot -- the same one on which he will be facing a primary election challenge from Democratic State Auditor Claire McCaskill.

McCaskill and Republican challenger, Secretary of State Matt Blunt, both have said new taxes are not the immediate solution to the state's budget troubles. Both say more savings can be found through cuts and efficient management.

Blunt criticized Holden for his "divisive tone."

"We need to focus on and prioritize education, not just make education into a political issue, and not use education as leverage to compel Missourians to increase their own tax burden," Blunt said, speaking at Mason Enterprises, a finance business in the St. Louis suburb of Clayton.

Holden's tax-and-revenue plan would generate $520 million for the 2005 fiscal year that starts July 1, 2004, because it would be in effect for just nine months. In the future, the plan would generate $689 million annually.

The governor said his budget also assumes $137 million in spending cuts, including the closure of the aging Chillicothe Correctional Center and the transfer of its 525 female prisoners elsewhere.

Holden's fiscal 2005 budget proposal aims to restore education funding to the amount public schools, colleges and universities were supposed to receive in fiscal 2003 -- before midyear spending cuts were made that year and carried over or deepened for the current year.

Senate Appropriations Committee Chairman John Russell, R-Lebanon, said Holden's budget and tax plans contained few new ideas, adding: "I don't know how much of that is doable."

Assuming Holden would renew his call for new taxes, House Speaker Catherine Hanaway, R-Warson Woods, and Senate President Pro Tem Peter Kinder, R-Cape Girardeau, both opened the 2004 legislative session two weeks ago with speeches warning against tax proposals, even for education.

On Tuesday, Senate Republicans outlined an agenda that includes a constitutional amendment requiring the governor to draft a budget based solely on current revenue projections -- not assuming new taxes as Holden has proposed. The Senate GOP agenda also included a goal of avoiding cuts to education funding, but no pledge to boost it.

Holden began his speech by reading the names, hometowns and ages of 18 Missourians killed in the wars in Iraq and Afghanistan -- a tribute that drew a resounding ovation.

Then, countering Republican claims that Missouri led the nation in per capita job loss in 2002, Holden said Missouri gained 30,000 jobs in the past year while the rest of the country lost 220,000 jobs.

Holden said Missouri created more jobs last year than any of its neighbors and more than all but seven other states. "We are bucking the national trend, and it's something we should all take great pride in achieving," he said.

Holden also proposed a 2 percent pay raise for most state employees, with raises of 4 percent to 10 percent for some workers in lower-paid, higher-stress positions such as mental health institutions and prisons.

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