Semantics Stir State Spending Spin

Add "restoring funding" and "budget cuts" to the list of phrases that obscure the state budget-making process underway in Jefferson City.

Millions of dollars in funds can be restored to programs or departments and millions more can be cut from budgets, but total spending by the state is more likely to go up than go down.

After being criticized from both sides of the political aisle for his budget proposal, Missouri Gov. Jay Nixon submitted an amendment to his recommended budget "that restores $40 million in funding" for the state's public universities.

As Missouri Journal reported, the $40 million will come from a settlement by states' attorneys general with the nation's five largest mortgage banks regarding foreclosure practices.

Setting aside that the money being counted on to fund higher education is from a settlement, it is important to remember that the entire state budget-making process each year is based on estimates of projected revenue and expenditures.

Therefore, no actual money is being cut or restored until after the funds are appropriated by lawmakers in May, which then needs approval by the governor. Even after the new fiscal year starts in July, however, if projected estimates are not hit, spending levels may still need to change.

Lawmakers are currently in the process of deciding who will get what funding for fiscal 2013. Some deparments and programs may get less money than in the past, while others will likely get more.

With the extra $40 million included, the proposal for fiscal 2013 climbs from the $22.98 billion budget plan released during the State of the State speech to $23.02 billion. Therefore, the revised proposal now outlines a spending reduction of .78 percent, down from the original reduction of .96 percent.

At this time last year the budget proposal also called for a reduction. However, if all appropriations are spent this fiscal year, despite all the talk of budget cuts and funding restorations last year in the Missouri General Assembly, total expenditures will increase year-over-year by 4.4 percent.

Whatever politicians decide for next fiscal year, the final total is likely to be different than the original proposal. The safe bet, though, remains on total spending increasing year-over-year. And it does not matter whether a Democrat or Republican is governor, or on what party controls the state legislature.

In the last 30 years, total expenditures have dropped year-over-year only three times, while total state spending has increased 468 percent from $3.9 billion in 1981 to $22.2 billion in 2011.

By Brian R. Hook, brhook@missourijournal.com, (314) 482-7944

Hook is editor of Missouri Journal, which tracks the economy across the Show-Me State. 

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