Nixon softens the blow of his higher education cuts.
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Nixon softens the blow of his higher education cuts.

Date: February 7, 2012
By: Jordan Shapiro
State Capitol Bureau
Links: The budget proposals

JEFFERSON CITY - Gov. Jay Nixon announced Tuesday he plans to soften his proposed cuts to Missouri's public universities with $40 million from a pending national mortgage settlement.

Nixon proposed a 15 percent cut to all higher education institutions for the 2013 fiscal year. The pending settlement is worth $140 million, but $100 million of that will go directly to homeowners. The other $40 million would cushion Nixon's higher education cuts and reduce them down to 9 percent from what the legislature appropriated last year.

Attorney General Chris Koster said he supported the proposed national settlement, but that negotiations were still ongoing.

"My intention is to settle this portion of the state's case against the banks returning more than a $100 million directly to mortgage holders in our state and adding tens of millions of dollars to the state's general revenue fund in these difficult economic times," Koster said in a statement.

Koster is part of a lawsuit with other attorney generals in the country filed against the five largest mortgage companies, who were indicted for fraudulent foreclosure practices during the 2008 budget crisis.

The General Assembly would also still need to approve the use of additional funds. State Budget Director Linda Luebbering said the funds would not be available until the start of the fiscal year in July.

Rep. Chris Kelly, D-Columbia, said he was "delighted" Nixon listened to the higher education community on restoring some his cuts.

"I am so proud of higher education," Kelly said.

Kelly, a member of the House Budget committee, said that he had no problem appropriating the additional money even though the state does not have it yet. He said it could be used at the end of the fiscal year if it does not come in on time.

Nixon praised Koster's work and announced his amended proposed cut to public universities immediately after Koster's statement.

"My administration remains committed to working with our colleges and universities to make higher education more affordable and accessible for Missouri families," Nixon said in a statement.

Senate Appropriations Chairman Kurt Schaefer, R-Columbia, expressed support for the additional funds, while still criticizing the governor's initial planned cuts.

"I am glad he realizes the cuts were unreasonable and unsustainable, but I will continue to work on this issue," Schaefer said.

Rep. Mary Still, D-Columbia, also said she was happy to see the cuts to universities partially restored, but that there was still a long way to go.

"We need to decide our vales as a state and make investments in higher education," Still said.

Still said the state needed to focus on increasing revenue such as raising the state's cigarette tax, currently one of the lowest in the nation.

The House has just started the process of reviewing the governor's proposed budget. When they pass their version, the budget will then move to the Senate. The 2013 budget must be passed by May 11, according to the state Constitution.


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