Holden reports state tax refund checks should be sent by August

JEFFERSON CITY, Mo. -- About 500,000 Missouri taxpayers should get their tax refunds by August, perhaps sooner if the House agrees to tap the state's so-called Rainy Day Fund generally used for fiscal emergencies, Gov. Bob Holden said.

On Wednesday, Holden and state Revenue Director Carol Fischer told reporters the fund would allow the state to accelerate payments of about $230 million in tax refunds delayed because of state budget troubles caused by lower-than-expected income tax collections.

Last week, the state said it still owed $167 million in refunds due to 415,000 Missouri taxpayers.

If the tax refunds are not paid by Aug. 15, the state would owe 6 percent interest to the recipients.

"The refunds will go out, maybe a little slower, but we'll get them out by the August deadline," Holden said Wednesday.

"We will fulfill that obligation."

All the while, the Democratic governor said House refusal to approve use of the Rainy Day Fund could force him to withhold more money from social services, higher education or public schools. And, he said, state employees might not be paid for all of the hours they work.

House Minority Leader Catherine Hanaway, R-Warson Woods, countered that she still opposed using the fund, and that "we should not be balancing our budget on the backs" of taxpayers owed money.

Fischer said that 72 percent of the refunds due to taxpayers already had gone out.

State Rep. Mike Reid, R-Hazelwood, said he had talked to Republican leaders about using the Rainy Day Fund to pay the tax refunds, and that "I think we owe that money to taxpayers."