STATE'S BUDGET CRUNCH IS WAKE-UP CALL

One Missouri legislator described state government's current budget crunch this way: "We've been on a spending binge."

And despite expressions of surprise along with moans of dismay, there is no way anyone in Jefferson City can claim the so-called shortfall in revenue sneaked up on us.

Last week House and Senate budget leaders issued a letter saying the current $17 billion state budget the one that covers spending through the end of June will have to be cut more than $300 million because of expected revenue shortfalls. Moreover, these budget leaders say, another $300 million will have to be cut from agency requests for the budget year that begins July 1.

So how did the state wind up more than $600 million in the hole for those two budget years? Keep in mind that the anticipated budget gap is only a part of Missouri's financial mess. The Missouri Department of Transportation estimates it is some $650 million-plus short of funds for its annual construction and repair needs. This estimate and the budget crunch come at the same time that refunds have been made to taxpayers because the state's revenue growth in recent years has exceeded increases in personal income.

In a word, the states budget situation is due to runaway spending by lawmakers who thought the good times would never end. State Sen. James Mathewson of Sedalia was correct when he fingered legislators for this fiscal problem. But Mathewson went too far when he blamed recent tax cuts -- cuts made to keep revenue in check so refunds wouldn't be necessary -- for leaner revenue forecasts.

The crunch comes from both ends of the budget -- and the middle too.

On the revenue end, generous projections have failed to materialize. Some tax estimates were simply too optimistic or purposely faulty.

On the spending end, dozens of programs -- some of them federally mandated -- are costing far more than projected.

In the middle, guesses about how much new legislative programs would cost also have been off by millions of dollars.

Arching over all of this spending spree has been the notion that the growth in state revenue, which accompanied a strong national economy, would go on indefinitely, resulting in costly new programs -- new prisons, for example, that would have to be maintained and staffed forever -- without regard for any likelihood of a revenue slump. The upshot of this thinking was to spend every nickel and dime of every dollar coming to the state.

Now the state is putting a tourniquet on the spending flow. State agencies are being asked to make major cuts. State hiring has been frozen. Just about every facet of state government is affected, except for state funding for schools. But many Missouri taxpayers will recall that the Outstanding Schools Act of 1993 produced one of the biggest spending splurges in state history along with an accompanying wallop in tax burden.

Gov. Bob Holden suggests some of the anticipated windfall from the national tobacco settlement might have to be used to cover some of the budget shortages. The governor called the crunch "probably the most significant shortfall we've had probably in a generation." But he didn't see it coming, apparently, while he served as state treasurer.

The wailing from Jefferson City may upset some Missourians, but others will see the current budget situation as a long overdue wake-up call -- one that might even put a halt to unchecked growth in state government.

Let's hope the same legislators who got us into this mess won't try raising taxes to bail out previous spending decisions. If they do, let's hope Missouri's voting taxpayers will rise to the occasion.