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Lobbyist Money Help  

Republicans offer alternative to tobacco bonds

February 04, 2003
By: Valerie C. Green
State Capital Bureau

JEFFERSON CITY - Republican leaders proposed an alternative Tuesday to Gov. Bob Holden's plan to sell tobacco bonds to make up a projected $350 million shortfall and avoid threatened cuts in education.

Speaker Catherine Hanaway, R-St. Louis County, and Senate President Pro Tem Peter Kinder, R-Cape Girardeau, announced a plan that includes $100 million in tobacco money plus $112 million in cuts to balance this year's budget.

"This plan shows that we can agree to use some of the revenue bonds, but it also shows that we can place withholdings without touching education," Hanaway said. "It gives the governor a compromise."

Holden said he was not surprised by anything in the proposal because all of the items had been reviewed and eventually ruled out by his budget staff.

"I am willing to look at all of these options again," Holden said. "Their proposal begins the process of gathering more information to find solutions to these budget problems."

The Republican plan would sell enough bonds to generate $373 million, but only $100 million could be used in this fiscal year, which ends June 30. The rest of the money would be reserved to fill the projected shortfall in next year's budget.

"This is the least worst of many bad alternatives," Hanaway said.

Although the legislature does not have the authority to make specific cuts, the Republican plan outlines suggestions for areas that the governor could target.

One such cut would delay construction of the UMKC Pharmacy Building. This would save the state $30.5 million this year.

Senate Appropriations Committee Chairman John Russell, R-Lebanon, said there aren't many things that big that haven't been started and could still be cut.

"We just couldn't find anything else," Russell said.

Rep. Chuck Graham, D-Columbia said he was not excited about the plan to cut the UMKC pharmacy.

"It will hold back the life sciences initiative and cost construction jobs that we need in this economy," Graham said.

Another $85 million would come from cuts to expense and equipment budgets throughout state departments. This money comes from cuts in travel, supplies, new computers and other "miscellaneous expenditures."

While the plan does not outline detailed cuts to specific expenses or departments, House Budget Chairman Carl Bearden, R-St. Charles, said he looked at random expenditures that could be cut to come up with the sum.

"We are not hindering services to the people of Missouri by making these cuts," Bearden said, explaining that the $85 million only represents about half of the unspent money.

The last $84.5 million is money that would normally be transferred to the next fiscal year. Instead of holding the sum over, the money that has been appropriated but not spent would be used this year.

"We will start fiscal year 2004 at exactly the same level we started 2003," Bearden said.

The plan also banks on the delayed judgment in a case against the state by Southwestern Bell. Kinder predicted the appeals process would take enough time to keep the state from paying a $50 million award this year.

The governor said he directed his budget staff to work "overnight" to analyze the details of the Republican plan. He said no other meetings were scheduled with the Republican leadership and that he wants his staff to work with the House and Senate budget staffs before anything moves forward.