Budget cuts cause pain for Missourians

JEFFERSON CITY, Mo. -- Terry McCoy feels the pain of state budget cuts.

It's a pain that shoots from his shoulders to his neck around the start of each month -- the time when, because of cuts in the Medicaid program for the poor and disabled, he cannot afford the morphine painkiller he needs.

So he has learned to adjust.

"Sometimes it's a throbbing, sometimes it's a sharpness, sometimes it's just aching," says McCoy, 38, partially paralyzed after a 1998 traffic accident. "Sometimes I reposition myself and that helps, sometimes it all depends on the activity done that day."

McCoy is among many suffering as a result of Missouri's budget cuts -- estimated at nearly $900 million over the past two years and about to grow larger.

Gov. Bob Holden is expected to announce another round of state spending cuts in the coming days, and still more are almost certain in the next state budget he is to outline by mid-January. State budget director Linda Luebbering says the state would need about $1 billion in new revenue just to keep pace with the current budget and meet rising expenses for such things as prisons and Medicaid.

Sluggish economy

The sluggish national economy has affected many states' budgets, but Missouri's troubles are due also to past decisions of governors and legislators.

Missouri politicians have cut taxes by nearly $1 billion since the mid-1990s, yet have doubled the size of the state budget during the past decade.

Now that tax revenue is down, the state is struggling to pay for its expanded programs and services. And the Missouri Constitution bars lawmakers from raising taxes by more than about $75 million annually without a statewide vote.

Tax increases are not popular with the new Republican-controlled Legislature, nor with the public. Voters rejected three proposed tax increases in August and November.

So with an influx of tax money unlikely, spending cuts may be the best short-term solution to keep the budget in balance.

Former state budget director Jim Moody, now a lobbyist who has traveled the state giving budget presentations to everyone from lawmakers to college leaders, says the state no longer can afford to spare the Medicaid program, public schools or prisons from cuts.

Controlling Medicaid

The state attempted to control Medicaid costs in the current budget, which is why McCoy is skimping on his pain medication.

McCoy was injured in a November 1998 accident while driving home after the late shift at a lead plant in Herculaneum. He says his life was saved through an experimental surgery. But his health still prevents him from working.

In October, the state began requiring some disabled people to actually spend -- not just incur -- a certain amount of medical costs each month before becoming eligible for Medicaid coverage. The move, which state officials said was requested by the federal government, saved about $16 million in the state budget.

Public colleges and universities have absorbed some of the biggest cuts so far. More than one-third of the $230 million in budget withholdings that Holden announced last May came from higher education.

State funding for colleges and universities in the current school year is 10 percent less than they were budgeted to receive last year.

Tuition has been raised at most state schools -- including a nearly 15 percent increase for in-state undergraduates at the University of Missouri system.

Sophomore Jennifer Damron has taken a third job while still carrying a full course load to pay for her tuition, books and other fees.

"What the budget cuts do to students is it takes their attention away from school and turns their attention to making money and being able to stay here -- and that's sad," said Damron, 19, who chairs a student government committee that relays concerns to administrators at the University of Missouri-Columbia.

House Speaker nominee Catherine Hanaway, R-Warson Woods, said lawmakers would try to fund colleges and universities at their current levels next year. But "the state of higher education today is tenuous at best," Hanaway has said.

So students are bracing for more budget cuts -- and the potential of even higher bills. That same uncertainty exists for nearly all state agencies and the people they serve.

Newly elected lawmakers just finished a three-week orientation that included visits to state colleges and universities, prisons, mental health facilities and other institutions affected by the budget.

McCoy hopes Jefferson City's decision-makers can envision themselves in his situation when they look for the next place to cut.

"Unless you're put in that place yourself, you're not going to understand," he said. "They're just looking at numbers, they're looking at saving money, that's all it's about."

HOW MISSOURI'S BUDGET WORKS

A look at how the state budget is put together:

THE BUDGET YEAR

Missouri's budget year runs from July through June; the state's 2003 fiscal year began July 1, 2002. Holden and lawmakers are working on a budget for fiscal 2004, which begins July 1, 2003.

THE BUDGET PROCESS

1. State agencies submit spending requests to Holden, fall 2002.

2. Economists meet to forecast state revenue, December 2002.

3. Holden presents a budget proposal to legislators, January 2003.

4. House subcommittees study Holden's proposal and make recommendations to the House Budget Committee, which sends a proposed budget to the full House for a vote. Likely March 2003.

4. The Senate Appropriations Committee considers the budget passed by the House and sends its own version to the full Senate for a vote. Likely April 2003.

5. Conferees from the House and Senate work out their differences and send a compromise version of the budget to each chamber for a final vote. May 2003.

6. Holden signs or vetoes the budget; he can eliminate or reduce expenditures through a line-item veto but cannot increase spending. June 2003.

THE BUDGET SOURCES

Less than half of the budget is funded through general revenue, such as state income and sales taxes. The rest is funded with federal dollars or with revenue from state taxes and fees with dedicated uses.

THE BUDGET DISTRIBUTION

Public schools and social services consume more than half the budget. This year, 28 percent of the money went to the Department of Social Services; 25 percent to the Department of Elementary and Secondary Education; 6 percent to the Department of Higher Education and 10 percent to the Department of Transportation.