Mo. Digital News
Missouri Digital News
Mo. Digital News
Missouri Digital News
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By Phill Brooks
«RM75»«FC»«MDBO»COL084 - Fiscal Discipline in Missouri Government«MDNM»
The legislature's recent approval of a major tax cut for businesses and income tax payers has caused me to think about the history of fiscal discipline in Missouri.
In its laws, as well as legislative practices, Missouri has a far stronger system for controlling government's spending appetites than does the federal government.
Unlike the federal government that can print as many dollar bills as needed, Missouri's Constitution prohibits deficit spending without voter approval.
Further, Unlike the U.S. president, Missouri's governor has line-item veto powers to cut or reduce individual items in budget bills. And when the budget takes effect, the governor can reduce spending whenever it appears the state will not collect enough taxes to fund the budget.
Missouri's legislature has its own system to restrain budgetary lusts. Both our state's House and Senate have budget-control committees that can block their chambers from considering bills that committee members think would put the state's budget in jeopardy.
Despite these safeguards, the system has not been perfect.
Shortly after I started covering Missouri's statehouse, critics charged Gov. Warren Hearnes with abusing the system by using his line-item veto powers to cut words, rather than numbers, in a budget line he did not like.
A decade later, the legislature and governor side-stepped the requirement that voters had to approve the state borrowing money with a trick to finance construction of the state's largest office building.
The Harry S Truman Building was funded by borrowed money. But voter approval was avoided by claiming that payment for those bonds would come from money the state would save by moving agencies out of rented space. Called revenue bonds, it was not classified as a general obligation debt of the state, despite protests at the time from the state auditor.
In recent years, it has struck me that exceptions to the fiscal discipline standards have become more frequent.
Just two years ago, the state auditor sued Gov. Jay Nixon because the governor was withholding money from the budget not because of a revenue shortage. Instead, Nixon was withholding money for the a future need -- expected disaster relief costs from the Joplin tornado.
On the legislative side, fewer bills are killed by the House and Senate budget-control committees. And Legislative fiscal oversight staff are less specific about the actual costs of bills. The word "unknown" frequently appears in staff estimates.
Legislators themselves have been more crafty in getting around those staff estimates. The estimates cover only the first few years. So, if a legislator wants to hide the full costs of a bill, the trick is to just delay full implementation until past the time reviewed by staff.
The traditional sanctity of the Senate's budget-control committee was assaulted in 2010. In that year, the Senate's top leader booted out Chuck Purgason as chair because he was blocking committee approval of business tax-break bill the Senate leader supported.
This year, the House speaker voted out a couple of members of his chamber's budget-control committee because of their opposition to a bill he supported.
Also this year, a long-term legislative standard in budgeting was violated. For as long as I have covered this place, Missouri's General Assembly has avoided appropriating money based on bills that had not yet passed.
The standard has been sidestepped, but not often. In fact, Republicans cited that standard in attacking Gov. Bob Holden's budget plan that was built on proposed tax increases.
Yet, this year the legislature approved shifting $20 million for the Kids First program for disabled children from general state funds to money that would be generated from a bill that had not yet passed the legislature and for which approval by the governor is uncertain.
But what stands out the most this year is that huge tax cut bill.
Supporters argue that the tax losses would be recovered from the economic growth generated by lower taxes on individuals and businesses.
Yet, that is not included in the cost estimate by the legislature's own fiscal oversight staff. Instead, they predict an annual loss to the state that eventually could total nearly $700 million per year.
The final version of the bill never came before the budget-control committee of the House. My reporter tells me the Senate's committee spent just minutes on it.
[Phill Brooks has been a Missouri statehouse reporter since 1970, making him dean of the statehouse press corps. He is the statehouse correspondent for KMOX Radio, director of MDN and an emeritus faculty member of the Missouri School of Journalism. He has covered every governor since the late Warren Hearnes.]
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