Holden cancels two-day furloughs planned for state employees

JEFFERSON CITY, Mo. -- Gov. Bob Holden has canceled plans for 6,000 state employees to go without pay for two days to help cover a budget shortfall for the current budget year.

Holden announced Wednesday that there would be no furloughs because the Department of Social Services was notified last week that $1.5 million in federal Medicaid reimbursements would be released to the state.

The governor also said that state agencies met his request by finding more than $29 million in savings, through reduced spending and federal reimbursements, for the fiscal year that ends June 30. The two-day furloughs that were expected to begin in June would have saved $1.7 million.

The furloughs would have affected mainly upper and middle management employees, including workers in the governor's office. Department directors and other high-ranking employees were to be asked to work without pay. Other employees would be given two unpaid days off. Lower-level employees who provide direct care to people generally would not be affected.

"I am pleased that we have been able to avoid these furloughs. State employees have worked the past year without salary increases and will do so next year," Holden said.

Still, Holden said no new state workers would be hired in the remaining five weeks of the fiscal year.

"These actions, taken together, will enable us to avoid furloughs and the associated disruption in state services," Holden said. "We are not yet 'out of the woods.' Like states throughout the nation, Missouri continues to face extreme financial difficulties that will require careful fiscal management."

Jackie White, commissioner of the state Office of Administration which was to oversee the furloughs, was relieved they were canceled.

"Having looked at the plans the agency submitted it was clear that administering this was going to be problematic," said White, who earns about $100,000 a year. "I think that there is relief among our state employees but also continued commitment to help the state make it through these tough fiscal times. Personally, I was prepared to work."

House Minority Leader Catherine Hanaway said Wednesday that she was pleased by Holden's decision but asked that the governor go further and restore funding to other state programs.

"I would encourage the governor to follow through on his decision to call off the furloughs by restoring his withholdings to social services, nursing homes and higher education," said Hanaway, R-Warson Woods.

Earlier this month, Holden announced $230 million in budget withholdings to help balance Missouri's current budget. The cuts were needed because of lower-than-expected state income tax collections.

Colleges and universities took the biggest hit in the cuts, losing $82.9 million in payments. Money is also being withheld from nursing homes, social services and job training programs.

Holden already had withheld about $600 million from the state's $19.2 billion budget for this year.