Revenue estimate shows Missouri in for yet another rough budget
The official revenue estimate released today for FY 020 shows Missouri has yet another rough budget year ahead and again proves [the] folly of attempting to tax-cut your way to prosperity. While the estimate reflects an expected $193 million in revenue growth, it is silent on the $320 million in revenue Missouri won’t collect next year due to the next phase of implementing an ill-advised 2014 tax cut [SB 509] As House Democrats warned then, this tax giveaway for [the] rich is resulting in serious consequences for everyone else.
State Rep. Kip Kendrick
House Budget Committee, Ranking Democratic Member
The final vote to override Governor Jay Nixon’s veto of SB 509. Representative Jeremy LaFaver (D) (left) – bearing witness, Representative Keith English (center) – casting the 109th vote necessary for the override, and Representative Ron Hicks (r) (right) – his escort on and off the House floor. May 6, 2014.
Kip Kendrick @Kip_Kendrick
Replying to @MBersin @Martha4MO
3 years into 5 year phase in and conservative estimate is $320 million this year. Year 4 and 5 will basically double this year’s cost. 6:13 PM – 28 Dec 2018
What, a $640 million shortfall the year after that?
As part of continued effort to make Missouri a leader in college affordability, Gov. Nixon has called on Missouri’s public universities to freeze tuition for the upcoming school year
Gov. Jay Nixon today visited Warrensburg to applaud the University Of Central Missouri Board Of Governors for answering his call to freeze tuition for Missouri undergraduates for the 2014-2015 school year. As part of his continued efforts to make Missouri a leader in college affordability, the Governor has proposed a significant funding increase for Missouri’s public four-year universities in his Fiscal Year 2015 and called on those institutions to freeze tuition for Missouri undergraduates.
“The evidence is clear, good schools help create good jobs,” Gov. Nixon said. “By investing in our universities and freezing tuition, we’re going to make sure students graduate from college with the skills to compete for good jobs, not a load of debt.”
Earlier today, the University of Central Missouri Board of Governors voted to answer the Governor’s call and freeze in-state undergraduate tuition for the 2014-15 academic year.
“I appreciate the UCM Board of Governors for taking action to keep college affordable by freezing tuition for next year,” Gov. Nixon said. “I encourage our other four-year universities, who haven’t already, to take action and hold undergraduate tuition flat next year.”
“The significant investments Gov. Nixon is making in higher education will help us to hold the line on undergraduate tuition next year while continuing to prepare students to find good jobs after they graduate,” said UCM President Chuck Ambrose. “The University of Central Missouri offers a world class education at an affordable price, putting a college degree and quality career within reach for thousands of students.”
Gov. Nixon has made the quality and affordability of higher education in Missouri a top priority of his administration. Over the past five years, Missouri has led the nation in holding down tuition increases at its public universities. The College Board’s 2013 Trends in College Pricing report shows that tuition and fees at Missouri’s public four-year institutions increased just 5 percent since 2008, lower than in any other state in the nation.
Gov. Nixon’s Fiscal Year 2015 balanced budget proposal includes an additional $36.7 million in funding for Missouri’s public universities, through Missouri’s performance-based funding model for higher education, implemented for the first time last year. The Governor’s STEM initiative would also provide an additional $22 million in core funding for Missouri’s public universities to help these institutions purchase equipment, expand lab space and produce more graduates in fast-growing STEM fields.
To address a critical shortage of mental health professionals in many communities across the state, the Governor has proposed a strategic investment of $20 million investment to help Missouri’s community colleges and universities train 1,200 students in high-demand mental health fields.
Last year, Gov. Nixon set a goal of giving every student in the state the opportunity to earn a Missouri A+ scholarship. Under the A+ program, Missouri students can earn a scholarship to cover the cost of tuition and academic fees for two years at any public two-year community college or technical school in the state. To be eligible for the program, students must meet academic achievement standards, conduct and attendance requirements, and perform 50 hours of tutoring or mentoring service.
Since the Governor took office, 266 schools have been added to Missouri’s A+ Schools program and 99 percent of public high school students in Missouri now have the opportunity to earn an A+ scholarship and attend two years of community college tuition free.
Gov. Nixon’s Fiscal Year 2015 budget proposal increases funding for all of Missouri’s major scholarship programs including Bright Flight, A+ and Access Missouri.
Earlier in the meeting Senator David Pearce (r) and Speaker Pro Tem Denny Hoskins (r), both representing districts which include the campus of the University of Central Missouri, provided a legislative update to the Board of Governors. After their reports Senator Pearce (r) and Representative Hoskins (r) did not stay to hear Governor Nixon speak.
Speaker Pro Tem Denny Hoskins (r) providing a legislative update to the University of Central Missouri Board of Governors
at their meeting in Warrensburg early this morning.
At several points in his legislative update Representative Hoskins (r) commented on Governor Nixon’s (D) revenue projection for the state budget.
Speaker Pro Tem Denny Hoskins (r): [….]
…Outside of the Governor’s paid staff no one believes in Missouri that our rev, general revenue will increase by five point nine percent…
…It, uh, it just makes it, uh, very disingenuous, um, the Governor makes recommendations based on a revenue projection that no one agrees with outside of he and his office. And then the House and the Senate take on the heavy task of, of being realists and saying, okay, we’re not gonna have a five point nine percent, and, uh, we have to go through and cut over three hundred million dollars from the government, Governor’s proposal…
Governor Jay Nixon (D) addressing the University of Central Missouri Board of Governors in Warrensburg this morning.
At the press availability after Governor Nixon’s address to the UCM Board we had the opportunity to ask about Representative Hoskin’s comments:
Question: …Governor, earlier today, um, Speaker Pro Tem Hoskins was here and spoke before the [University of Central Missouri] Board [of Governors] and he stated, “…it makes it very disingenuous,” this is a direct quote, “…it makes it very disingenuous when the Governor makes recommendations based on a revenue projection no one agrees to outside of he and his office.”
Governor Jay Nixon (D): Well, I mean, we feel good about, uh, the way the economy’s moving forward in the State of Missouri. Um, the revenue estimates we based this year’s on is less than last year’s gain, um, as far as, uh, revenue growth this state and, and less than has been historically over the last, uh, forty years. So we feel comfortable, uh, that as the economy is moving back, uh, both, you know, that these resources will be there. We look forward to working, uh, with folks, uh, to, uh, to, to hit the, hit these targets.
Question: What kind of reception have you gotten in the General Assembly that would suggest that they’re going to go for the revenue projections that you’ve got in terms of how they budget?
Governor Jay Nixon (D): Well, I think everybody understands that, uh, that the economy’s moving forward, it’s just at what rate it’s moving forward. Uh, we feel that with some of these significant investments, especially as I mentioned here, in the auto sector, one right here in, in Warrensburg, that we’re seeing, uh, that strong growth. Like I said before, I, I, uh, um, you know, it, uh, it’s important, um, that, that we, uh, make sure that we all understand that the, the best economic development tool, tool there is is education. And I think, uh, rather than, uh, uh, than, I think our focus should be on taking the resources we have and making the most impact with them for the future. And the best way to do that is to, is to adequately fund our education system.
Question: …The Associated Press reported on your remarks yesterday at the, uh, Governor’s mansion that, uh, you were not, uh, ruling out running for President. I, my follow up question from yesterday is how about Vice-president, uh, have you, uh, talked with, uh, Hilary Clinton about that [crosstalk], that possibility?
Governor Jay Nixon (D): I, I , it’s just, I, uh, um, I’m looking forward to, to campaigning with, with Secretary Clinton should she decide to make the, uh, the run. And, and, uh, focus, my attention is focused on, uh, serving the people of the State of Missouri now and that’s the, it’s, uh, it’s managed to keep me very, very busy serving the people of the Show Me State. And I’ll, I’ll focus my attention there…
…But, uh, no, I think that, uh, I think that the, this is the year in which we, with the economy growing we have resources to, uh, to invest in education. That’s why our, our three pronged attack here has been to say let’s, let’s expand preschool opportunities, ’cause if kids are ready to learn when they start preschool, that’s why we’re tripling the, the availability of dollars [inaudible] preschool project. At the K through twelve level we need to fully fund the foundation formula. And we’re on a path in my budget to get that done over the next two years. And then thirdly, uh, by getting, uh, keeping tuition frozen the way that this board just voted today to do, uh, we’re in a position to continue to keep Missouri as the national leader, uh, in the smallest tuition increases of anywhere in the country, while at the same time expanding both access and quality of those, uh, higher education institutions. And that’s why, uh, uh, folks can, can talk about various budgetary amounts, as long as we keep our eye on the prize, which is making sure that the best economic development tool there is, education and a great education system, is where we’re all working together. Uh, I’m confident that, that we will make a difference that’ll make, uh, a lasting difference for, uh, kids and families of our state.
Governor Jay Nixon (D) at the press availability in Warrenburg after the University of Central Missouri Board of Governors meeting.
Summary: The House has approved a substitute for SB 26. The measure was altered significantly in the House but has not been improved. Rather, it has become even more devastating to state services and will burden at least 40 percent of Missourians with a significant tax increase. In addition, several provisions will likely result in ongoing litigation.
Overall, the major provisions of the bill will decrease the state individual income tax rate from 6 percent to 5 1/3 percent; decrease the corporate income tax rate from 6.25 percent to 5.5 percent after exempting the first $25,000 of corporate income from tax; increase the state sales tax from 4 percent to 4.6 percent (and dedicates the increased sales tax to roads and K-12 education); and create a new business income deduction of 50 percent. In addition, a House amendment added a new option for determining a company’s tax base. This is likely to have a cost, but no estimate is currently available. While the bill also created an additional tax deduction for low-income Missourians, it would have little impact due to its design.
The measure increases Missouri’s sales tax from 4 percent to 4.6 percent (Missouri has an additional .25 percent designated sales tax, making the overall rate 4.85 percent). By reducing the income tax and increasing the sales tax, the proposal will increase taxes for 60 percent of Missourians – those who can least afford it. Missourians with incomes of $53,000 and less will pay more in tax than they currently do, while those whose average income is more than $1 million will receive an $11,000 tax cut on average. In particular, Missouri seniors who rely solely on social security for their income face a tax increase.
[emphasis in original]
Ah, the little people, who no one cares to hear, get a tax increase.
“…even though you can’t see or hear them at all, a person’s a person, no matter how small…”