Special session to begin on June 2

JEFFERSON CITY, Mo. -- An unprecedented special legislative session to reconsider portions of the state budget vetoed by Gov. Bob Holden will begin June 2.

Republican lawmakers vowed to continue to hold the line against the new taxes the Democratic governor wants to expand state spending.

Holden has said he will veto four of the 13 bills that make up the nearly $19 billion state operating budget the GOP-led Missouri Legislature approved earlier this month. Holden plans to sign the remaining measures into law.

The targeted bills account for 65.3 percent of total state spending and 75.2 percent of net general revenue, the state's most flexible funding source, for the fiscal year starting July 1.

No governor in state history has ever previously vetoed a state department's entire budget. Holden's actions will nullify the budgets of five departments -- elementary and secondary education, higher education, mental health, health and social services.

The special session call will ask lawmakers to boost spending for all the departments and to put some kind of tax package before voters to pay for the increases.

Holden next week will announce a tax plan modeled on one he introduced in January that called for new taxes on smokers, the casino industry and wealthy Missourians.

House Majority Floor Leader Jason Crowell, R-Cape Girardeau, said the special session will be a waste of time and money and noted that the legislature's budget is only 1.7 percent lower than Holden's recommendation in terms of total dollars.

Also on Friday, Holden announced $80 million in immediate spending cuts.

Before Friday, lower-than-expected revenue had already prompted the governor to withhold $282 million that had been appropriated for state government for the fiscal year that ends June 30.

Of the additional $80 million in cuts announced Friday, slightly less than half will be taken from elementary, secondary and higher education and the rest from among other parts of state government.

But some of the spending cuts -- both in the current and upcoming fiscal years -- could be canceled by an influx of federal money under legislation passed Friday.

The U.S. Congress gave final approval to a $330 billion tax cut bill that also includes $20 billion in aid for the states.

Missouri expects its share to be around $376 million and Missouri Republicans were cautiously optimistic at least some of the revenue could be used to restore cuts in services.

Holden, however, said the federal tax cuts will end up costing Missouri $246.6 million next year because the state tax code is tied to the federal code. He said much of the difference will be needed to cover federal mandates.

In theory, a special session could be finished in five days. However, lawmakers aren't expected to wrap it up that quickly because of the expansive nature of the call.

Holden's inclusion of changes in state election law on the session's agenda caught legislators by surprise.

Under current law, November is the earliest a tax package could be put on the statewide ballot. Holden wants the law altered to allow for a vote in August or September.

But with Republicans unwilling to budge on taxes, the election issue could be moot.

The governor wouldn't say if he would veto the appropriations bills a second time should the legislature refuse to give him what he wants. The affected departments would shut down if the spending measures aren't approved by July 1.

"They've got time in June to solve that problem," Holden said. "We'll cross that bridge when we come to it."

The Associated Press contributed to this report

mpowers@semissourian.com

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