This week, the Senate focused mostly on the budget. I think everyone agrees we’re in a tight spot this year. The loss of economic activity due to COVID-19 has resulted in shortfalls in state revenue. With the deadline for state income tax filings pushed into July, we won’t know the full revenue picture until the current fiscal year has passed. Despite the uncertainty, the General Assembly prepared a state budget that fully funds K-12 classrooms, continues to provide health care to low-income and disabled Missourians and makes few changes to essential state programs and services. What has changed is the portion of our state budget that comes from Washington, D.C. These federal dollars not only pay for COVID-19 expenses, but largely make up for decreased revenue from state taxes.
In a typical year, general revenue from taxes accounts for about a third of the state budget. The rest comes from federal funding and various fees. When the Legislature met in January to hear the governor present his budget, we anticipated spending about $30 billion in 2021, with roughly equal parts coming from state taxes, federal programs and fees. The budget we pass this week will total more than $35 billion, with about 42 percent of that spending coming from federal money. Almost all of the increased spending is related to the COVID-19 crisis, and nearly every dime of additional money comes from the federal government, much of it through the Coronavirus Aid, Relief and Economic Security Act.
Looking at the individual appropriations bills for the various departments of Missouri’s government, I see general revenue spending for state agencies either flat or falling in most cases. Federal funding increases for many of the departments, in some cases dramatically. The Department of Elementary and Secondary Education will receive three times as much federal money next year than it did in 2020. Much of this will pay for off-campus meal programs. State funding for higher education declines 10 percent, but federal support grows four-fold. There’s a 300 percent increase in federal funding for the Missouri Department of Agriculture, with $20 million set aside to assist livestock producers and meat processing facilities. Spending for the Department of Public Safety – normally a small portion of the state budget – will triple in 2021, thanks to a 579 percent increase in federal funding.
In my opinion, it took a lot of juggling to balance the state’s books. Without the influx of federal funds, I believe we would have faced deep cuts in state programs. In truth, the budget we pass this week is an imperfect document – not quite a guess, but close. None of us know what’s going to happen in the coming months. Will we see a second round of COVID-19? Will the economy recover quickly? Will the federal government pass additional relief packages? We don’t know the answers to any of these questions. Given what we know now, the General Assembly did the best we could. We preserved critical state programs, while putting federal dollars to work addressing the direct impacts of the coronavirus.
Beyond the budget, there aren’t many details to report yet. Many bills still await final action. I am encouraged that several measures I sponsored seem to be headed toward the finish line. My legislation to address the repeal of a sales tax for the now-closed Ripley County Memorial Hospital will likely pass as part of another bill. Also, my proposal for a state fund to pay for school transportation costs is progressing, as well. I’m optimistic both will reach the governor’s desk. Several other bills I sponsored have gained traction and I have hopes that some of those will pass. Of about a dozen of my bills that have moved through the legislative process, I am particularly hopeful about proposals to tax internet sales, reform Missouri’s unemployment insurance system and provide Epi-pens to rural fire first responders.
We have one week remaining before the constitutional close of the 100th General Assembly. I imagine the coming days will see a flurry of activity as legislators scramble to get their proposals attached to other bills. In a few weeks, we’ll look back on this session and assess our accomplishments. Regardless of how many bills pass, this will definitely be a legislative session to remember.
Out of an abundance of caution, Senate offices remain closed. Although we will not be available for visitors, you may contact us by email or phone. Please don’t hesitate to contact my Capitol office at (573) 751-1882.