Unbalanced budget moving forward

JEFFERSON CITY, Mo. -- House and Senate negotiators have agreed on a roughly $19 billion budget for next year that they concede could likely fall short of balancing.

While cutting expenditures for numerous programs, the budget agreement reached early Thursday morning still manages to guarantee a $110 million increase for public schools with the potential for them to receive even more.

The House and Senate face a 6 p.m. deadline today to send the fiscal 2003 budget to Gov. Bob Holden. If they fail, the governor could summon them into a special session to finish their work.

Lawmakers had different interpretations Thursday on how short they were of balancing the budget, which would take effect July 1. That's because the budget depends partly on lawmakers approving new revenue sources.

"Under the best of circumstances, we're within a fudge factor of being balanced," said longtime Sen. Wayne Goode, D-St. Louis, one of the lead budget negotiators.

But if lawmakers don't approve the revenue enhancement bills, the budget "could be seriously out of balance" -- perhaps by several hundred million of dollars, Goode said.

The uncertainty is due to the fact that while the budget must be passed by Friday, lawmakers have until the May 17 end of the session to pass other revenue bills.

Still pending are rival House and Senate bills that would raise between $49 million and nearly $200 million through higher casino taxes, eliminating some business tax incentives and encouraging the payment of overdue taxes by temporarily waiving penalties.

Unresolved business

Also unresolved is a bill imposing a new tax on pharmacies and another bill allowing the state to sell bonds secured by a portion of its future payments from a national settlement with big tobacco companies.

The pharmacy tax could net the state $31.5 million. The tobacco bonding bill could generate quick cash but reduce the state's tobacco settlement revenues in the long run.

The negotiated budget depends on $50 million next year from tobacco bonding and another $49.4 million from other revenue enhancements, said Senate Appropriations Committee Chairman John Russell, R-Lebanon.

The budget may be a little ragged, Russell said, but he was hopeful it will avoid a special session.

Opposition to the negotiated budget is likely in the House, where some conferees neared tears and others stormed out of meetings because of cuts made to their favorite programs.

House Budget Chairman Tim Green, D-St. Louis, said negotiators spent more than 50 hours on the budget in the past two weeks. To forge a compromise with senators, Green sometimes agreed to cuts opposed by one or more of the members on his negotiating team.

Late Wednesday, for example, Green agreed to trim $1 million from the cross-state Amtrak passenger train service over the objection of his transportation subcommittee chairwoman, Rep. Joan Bray, D-St. Louis.

The cut would lower Amtrak's subsidy to about $5 million -- not enough to provide twice daily train service, Bray said.

Senate negotiators suggested a letter to Amtrak officials asking them to continue the existing service with the chance of receiving more money in the future.

The budget also cuts money for state colleges and universities. But lawmakers never considered cuts for elementary and secondary schools, instead focusing on how much of an increase to provide to this year's $2 billion base.

Under the budget agreement, schools would be guaranteed a $110 million increase.

If the legislature passes a revenue enhancement bill, the first $89 million of that would go to the state's general revenue fund. Any new revenues above that would provide a bonus to the school formula, taking the total funding increase for schools to as much as $154 million.