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Budget Meets Early Challenge in Senate

April 24, 2002
By: Brian Connolly
State Capital Bureau

JEFFERSON CITY - A day that began with heated exchanges and visible frustration ended with high fives and congratulatory speeches. In the process Missouri's budget cleared one of its biggests obstacles in the Senate -- for now.

Two proposals aimed at generating revenue for the cash-tight budget received preliminary approval.

The first, from Sen. Jim Mathewson, D-Sedalia, would change a series of state tax regulations to provide an estimated $50 million more for the next fiscal year. Among the provisions included is amnesty for people who pay overdue taxes and a repeal of the discount currently given to employers who file certain tax paperwork on time.

The second proposal, from Sen. Ken Jacob, D-Columbia, would sell a portion of the state's tobacco settlement in order to get cash sooner than planned. Exactly how much the sale will fetch for the next fiscal year is uncertain, but estimates range from $50 million to $100 million.

Jacob said that as late as Tuesday night he thought his tobacco "securitization" proposal was dead. The plan had stalled when some Senators raised concerns the funds could support human cloning research or abortions. That opposition, combined with the rapidly approaching May 10 deadline to complete the budget, caused Senate leaders to begin Wednesday's work on the budget without settling the securitization issue.

Once debate began on the first budget bill, which deals with public debt, Jacob said an additional $150 million was needed for the Senate to complete the budget. He said either his securitization proposal or use of the budget reserve fund, often called the "Rainy Day Fund," were the best options for making that money available.

"Do you want to throw us in a special session," Senate Appropriations Chairman John Russell, R-Lebanon, asked Jacob.

"I would rather do that than have a few of these programs that I've spent my whole adult life working on cut because of a bad year," Jacob responded.

The bill eventually passed without major change but Democratic opposition resumed on the next bill when Sen. Ted House, St. Charles, offered an amendment to use budget reserve money to boost funding for local schools. After conferring with Republican Floor Leader Bill Kenney, Russell withdrew the budget bill in frustration.

"There doesn't seem to be the will of the body to move forward at this time," Russell said at the time.

After more than an hour of closed door discussions, which Jacob said involved Holden and his staff, the Senate returned to the securitization proposal and approved it by a vote of 25 to 7.

One of the bill's main opponents, Sen. Dave Klarich, R-St. Louis County, said he voted for the measure after receiving assurance that "the objectionable use of these funds is not going to occur." Klarich also said he received assurances that work on the budget would resume Thursday without the type of "hostile" amendments offered Wednesday.