JEFFERSON CITY • Although he says the state’s budget situation is stronger than last year, Gov. Eric Greitens unveiled a spending proposal Monday that will cut funding for Missouri’s public universities.
The $28.7 billion blueprint, which includes $68 million less in state funding to universities and two-year schools, will now become the basis of negotiations between the second-year Republican governor and the GOP-controlled House and Senate.
“The budget we’re introducing today is a common-sense, conservative budget. We’re watching out for the tax dollars of the people of Missouri, making important investments in Missouri’s future, and also making tough decisions,” Greitens said during a press conference in his office.
A key factor behind the cuts is a rise in spending on Medicaid, a health care program for the poor and elderly that will cost the state more than $11 billion next year. Greitens described the rising costs as an “explosion” but said the answer is not to raise taxes.
Immediate reaction, even among the governor’s fellow Republican lawmakers, was harsh.
“We cannot continue to balance the budget on the backs of students; they are the future workers and job creators Missouri desperately needs to cultivate,” said Sen. Caleb Rowden, R-Columbia. “Continuing to neglect our public colleges, universities and trade schools seriously hinders Missouri’s ability to compete.”
The outline relies on a projection that revenues will grow by 2.5 percent in the fiscal year beginning July 1.
The budget blueprint was released 12 days after Greitens acknowledged he had an affair with his former hairdresser in 2015. He refused to answer multiple questions about allegations that he took a picture of the woman and told her he would release it if she talked about the affair.
Greitens' lawyer: "No violence. No picture taken. No threat of blackmail."
Greitens said he had no plans to resign from office and he brushed off questions about whether the scandal could hurt his ability to deliver on the promises outlined in his budget, which includes adding $87 million for elementary and secondary education.
Other initiatives include a $162.8 million increase in funding for roads and bridges and a new $25 million matching grant fund for local communities to build roads and other infrastructure.
Missouri Chamber of Commerce President Dan Mehan praised the matching grant plan, saying the money could help businesses beyond building new roads and bridges.
“Missouri also needs to make key investments in our ports and utility infrastructure — investments that will boost the economies of communities across Missouri,” Mehan said.
The outline would spend about $200 million more than the current budget, but it would not raise taxes. State workers earning under $50,000 would qualify for one-time bonuses of $650 pending further reforms of the state hiring system, Greitens said.
The budget plan would cut about 90 positions from the state workforce of about 54,000.
Greitens also wants to close unused bed space at state juvenile detention facilities, saving about $3 million but add about $29 million in new funding for programs serving foster and adopted children.
The plan calls for the approval of a $250 million short-term loan that could be used to speed up tax returns, which have been chronically delayed in recent years due to cash flow problems.
Democrats said the proposal spreads money thinly around state government, creating the illusion that Greitens is addressing the state’s needs.
“But no amount of budgetary sleight of hand can obscure the reality that years of tax cuts for corporations and special interests have left Missouri without sufficient money for the basics,” said House Minority Leader Gail McCann Beatty, D-Kansas City.
One bargaining chip on the table is a $40 million proposed cut to Medicaid programs.
Neither Greitens nor budget director Dan Haug would provide details of what might be slashed, saying the mechanics were still be worked out.
“We’ll define that as we go along,” Haug said.
Nursing home advocates, who faced a fight last year over cuts to their rates, were disappointed the proposal didn’t include reimbursement rate increases.
“While the governor did not further reduce the Medicaid provider rate, Missouri knows the cost of caring for these citizens and should set its provider rate accordingly,” said Nikki Strong, executive vice president of government affairs and member services for Missouri Health Care Association.
Cutting state aid to public universities has been a theme in Greitens’ first year in office.
He previously reduced spending on universities by $24 million to help balance the current budget, in which universities weathered a 9 percent cut. Those reductions led to hundreds of layoffs at two- and four-year institutions statewide.
Multiple higher education leaders were hopeful the Legislature would restore some core funding.
In addition to the cuts, 10 percent of each school’s funding will be tied to a series of performance standards, such as graduation rates and how many graduates get jobs or enroll in graduate school after they leave campus. One college administrator explained that schools will get that funding, but if they don’t meet all of their measures, they could see cuts.
“We’re at the stage where, to continue to meet community needs, we’ve got to figure out other ways,” St. Louis Community College Chancellor Jeff Pittman told the Post-Dispatch. “We’ve got to consider increasing tuition. That’s where it is for me.”
His college is among several statewide that has endured layoffs and voluntary buyouts in an attempt to save money after year-over-year budget reductions.
Chuck Ambrose, president at the University of Central Missouri, said he’s hopeful higher education advocates in the Legislature will reconsider the “starting point” that is Greitens’ budget.
“These cuts and the divestment of state support is really shifting responsibility to individuals and not the public good,” Ambrose said. “We believe these kinds of funding decisions cause damage that may be hard to repair.”