New financial pressures hold down budget debate

The Associated PressJEFFERSON CITY, Mo. -- With new, heavier fiscal pressures hanging over the Capitol, state senators passed an $18.8 billion budget Thursday and approved two revenue-raising measures.

The proposed budget for the 2003 fiscal year, which starts July 1, cuts funding for numerous state agencies and services from current levels.

Senators had been expected to restore some of those cuts.

But the spending spirit was dampened when Gov. Bob Holden announced Thursday that the state faces an unexpected revenue shortfall of as much as $250 million through the final two months of the current fiscal year.

"I think that caused a lot of them to take a second thought, or look, at their (spending) amendments," said Sen. John Russell, R-Lebanon.

Besides amendments correcting numerical mistakes, the Senate added just $220,400 to the budget while approving the dozen bills comprising the spending plan.

In a repeated pattern, senators proposed amendments to add money to various programs, were met with opposition and then withdrew their amendments.

The longest debate occurred as some senators sought to increase funding for nursing homes over the amounts approved by the House and recommended by the Senate Appropriations Committee. They ultimately gave up their efforts without a vote.

The Senate budget will have to be reconciled with a $19.4 billion House-passed budget, which relied on revenues from new taxes and fees and still was not balanced.

Top senators said this year's financial problems likely will carry over into the 2003 fiscal year.

Longtime appropriations committee member Sen. Wayne Goode, D-St. Louis, suggested that as much as half of this year's budget shortfall might have to be absorbed next year.

Lawmakers have been drafting the fiscal 2003 budget based on a projection that the state's general tax revenues would grow more than 2 percent. Holden's budget director, Brian Long, said it's possible that growth rate could be revised downward.

Among the funding decisions facing lawmakers is how much to increase spending for public schools.

The House had passed a $175 million increase to the roughly $2 billion base in the school funding formula. The Senate approved a $100 million increase after rejecting an amendment that would have raised that to $150 million by tapping the state's emergency savings account.

Sen. Ken Jacob, D-Columbia, sought to replace money cut from several college scholarship programs. He relented after members of the Senate Appropriations Committee said they would try to restore the money while negotiating difference with the House.

One of the few amendments adopted Thursday was a $100,000 cut in funding for the University of Missouri at Kansas City because of writings by associate professor Harris Mirkin about pedophilia and homosexuality.

The House also had cut that money from its version of the budget.

After completing work on the budget, the Senate passed and sent to the House two measures intended to raise about $150 million for next fiscal year. The senators, however, did not appropriate that money in the budget, leaving room for negotiations with the House on how it might be spent.

The Senate voted 22-7 for a bill allowing the state to issue bonds against 30 percent of the $4.5 billion the state expects to receive over 25 years from a settlement with big tobacco companies.

Supporters say the cash advance could provide as much as $100 million next fiscal year, plus more money in the short term. In the long run, the state would forgo part of its expected settlement payments.

By an 18-10 vote, the Senate passed a bill raising nearly $50 million by eliminating some business tax incentives and encouraging the payment of overdue taxes by waiving interest and penalties during a two-month period.

------Budget bills are HBs1101-1112 (Green).

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