By Rudi Keller
The $50 million request for the MoScholars program, which is supposed to be funded from donations and tax credits, was approved in the Missouri House as part of its budget proposal. But state Sen. Lincoln Hough, a Republican from Springfield and chair of the Senate Appropriations Committee, stripped it out after boosting the foundation formula for public schools by $300 million the day before.
“I want to make sure that we’re fully funding our obligation to public schools before we start spending 10s of millions of general revenue dollars on private schools,” Hough told reporters after making the cut.
In his State of the State speech to lawmakers in January, Kehoe said he was not funding the foundation formula to the level directed by state law because it no longer fairly distributes the money. The extra money for the scholarship program, he said, would give parents more educational choices.
Public schools come first, Hough said Wednesday.
Kehoe “admitted we’re not funding K-12 to the level that it’s supposed to be funded.” Hough said. “And I think that’s an obligation that we have, especially when we have the money in the bank.”
Missouri has a healthy general revenue surplus, with $3.7 billion in the fund on March 31. There is another $1.5 billion that, like general revenue, is unrestricted. But revenue is declining in the current fiscal year and, while modest growth is projected for the future, the budget being prepared now will use at least $1.6 billion from the surplus.
The budget is based on a projection of $13.6 billion in general revenue. Kehoe proposed spending almost $16 billion, including construction and maintenance funding, and the House budget plan uses $15.2 billion.
The exact totals for the 13 budget bills funding state operations approved by the committee were not available Wednesday. But with the extra money for public schools, plus $107 million for child care subsidies and dozens of new earmarks, the total is sure to be substantially higher than the $47.9 billion from all funds approved in the House and could exceed the $50.1 billion total in Kehoe’s proposal.
Three more bills spending another $3.7 billion for construction and maintenance are awaiting a final House vote before the Senate committee can make its changes.
The greatest uncertainty for the upcoming year is whether substantial cuts will be made to federal spending. The largest single shared program is Medicaid, with Missouri paying 10- to 35% of the cost for each person enrolled and the federal treasury covering the rest.
The group made eligible by a 2020 constitutional amendment costs the state the least, only 10% of the expense. So far, Missouri has not spent any general revenue on the expanded group, using other sources of money, including federal aid banked during the COVID pandemic.
If Missouri were required to pay 20% of the cost, it would have to find $300 million to keep it in place for the 350,000 enrollees.
Hough has been warning that federal cuts could upset Missouri’s budget. But on Wednesday, he said the committee can only write a budget based on what is currently in place.
“To the extent that we can, we plan for this kind of stuff,” Hough said. “But how do you plan for a Medicaid reimbursement on an expanded population that goes down by, say, say, 20% and costs us $600 million?”
The $50 million cut to the scholarship line was the largest cut of the day but not the only one. The Senate committee took out $10 million the House included to hire an architect to prepare plans for expanding the Capitol. Another set of cuts targeted some of the earmarked items approved in the House.
And cuts were used to express lingering resentment for the factionalism that fractured Republicans in the state Senate for four years. State Sen. Mike Cierpiot of Lee’s Summit cut 25 employees and $684,000 from Secretary of State Denny Hoskins’ budget, noting that the positions had been open for a long time and the office seems to function acceptably without them.
Hoskins was a member of the Freedom Caucus, which repeatedly tied the Senate up in filibusters to push its brand of Republicanism. And as a member of the Senate Appropriations Committee, he argued often against retaining employee authorizations that departments were unable to fill within six to 12 months.
Hoskins, inaugurated in January, is authorized to employ 267 full time staff. During the fiscal year that ended June 30, his predecessor, Jay Ashcroft, used 205 of that amount.
Hoskins said he needs to study each position in his to determine if it is needed if the cut is made.
“I will comply with whatever they do,” he said.
Hough said he had no objections to cutting the unfilled positions.
“Sen. Hoskins, when he was on this committee with us,” Hough said, “was always kind of a hawk on that stuff.”
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