Blunt seeks tax cut, limits on new employees

~ The governor also called for complete reform of the Medicaid system.

The time is ripe for a tax cut, Gov. Matt Blunt said Tuesday during a telephone interview with reporters from across the state.

After entering office in 2005 facing a massive budget shortfall, Blunt and the Republican-controlled Missouri Legislature adopted restrictions on Medicaid eligibility and cut the total number of state employees from 65,0000 to fewer than 60,000. Since that first session, revenue have been growing, with the state treasury ending the most recent fiscal year with a $292 million surplus and strong growth continuing during the first half of the current year.

"This year is an opportunity to provide tax relief to hardworking Missouri families," Blunt said.

A tax cut, he added, is a "way to make sure we have a small and limited government." Blunt wouldn't specify which taxes he wants to cut or how large a cut he would propose. He will make the details public in late January when he gives the annual address to the legislature, he said.

The Southeast Missourian participated in a session with reporters that was the first of several wide-ranging talks with journalists from around Missouri. During the interview, he recited the accomplishments of his first two years in office and outlined the tax cut and other items he will make a priority during the coming legislative session.

The accomplishments, the Republican governor said, include Medicaid reductions that have saved the state hundreds of millions of dollars in the health care program for the poor, bills rewriting laws governing workers' compensation programs and civil lawsuits, and additional money directed toward public schools and universities.

In addition to a tax cut, the upcoming session should focus on a complete overhaul of the Medicaid program and additional support for education, he said.

Blunt held meetings Tuesday with advocates on two of those three issues. College and university presidents made the case for a $110 million increase in state aid, enough to return the schools to their 2002 funding level. According to a report in the Columbia Daily Tribune, Blunt also met with Stephen Moore, a Wall Street Journal editorial writer and author of a report for the Show-Me Institute calling for elimination of the state income tax.

Like his tax cut, Blunt was unwilling to be specific about what he will propose for funding colleges and universities.

"No commitments have been made but we are in good discussions," Blunt said.

In the current fiscal year, state general revenue spending is set at $7.7 billion, the highest sustainable level since Fiscal 2001. Other years have had higher amounts appropriated, but revenue fell far short of projections. Revenues this year are forecast to be about $300 million higher than was expected last year at this time.

Blunt made no commitments for any new spending in the next fiscal year, which begins July 1. "Considering all the recommendations from a variety of departments would spend far, far more than any surplus that is out there," he said.

State veterans homes, for example, are seeking 127 new nurses and nursing assistants to allow 200 empty beds to be used and cut down a waiting list of more than 1,000 veterans needing care.

Blunt doesn't want to add new employees if it pushes the total number of state employees above 60,000. He didn't rule out the extra nurses, but cuts would have to be found elsewhere to provide them. "We have asked state employees to do more with less, and I commend state employees for stepping up and doing so," he said. "We are never going over that number again while I am governor."

Blunt sought to deflect suggestions that a recent report on the costs of operating state schools for the severely disabled was an attempt to justify closing the schools. "Most anything government does ought to be studied and evaluated," he said.

Blunt said he has heard from Southeast Missouri residents worried that the Parkview State School in Cape Girardeau may be closed. "I have yet to take any sort of position officially," he said.

The governor did state his priorities for the program he will propose to replace Medicaid. It will focus on providing preventive care, aid in the event of catastrophic illness and encouraging healthy behavior, he said.

The emphasis will also include increased use of technology and better communication between health care providers, he said.

A working group of state agencies, building on a legislative committee report, issued a proposal early this month but Blunt hasn't endorsed it. The current system wasn't working when he took office, Blunt said, and it is still badly in need of an overhaul.

"It is not a good deal for taxpayers and not a very good health plan for participants," he said.

rkeller@semissourian.com

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