Missouri Gov. Mike Parson said this week that at least two more rounds of cuts to state spending will be necessary to balance the budget amid the coronavirus-induced downturn.
In a news conference Tuesday, he said the first round would come in the next 10 days and hit the current fiscal year’s budget, which has already been slashed by $223 million since April 1.
The second round will come around July 1, the first day of the next fiscal year.
“COVID-19 is unlike anything we have ever faced before,” Parson told reporters Tuesday. “As a result, we have to take a hard look at our budget and make some very difficult decisions.”
He didn’t say how much would be withheld in either round Tuesday, but he told education officials the next day he anticipates having to cut up to $500 million-$700 million around July 1 and made clear the cuts they’ve already experienced won’t be the last.
Parson told reporters Tuesday that additional aid from the federal government — which is currently caught in a stalemate on Capitol Hill — could still change that.
“But if that doesn't come in,” he said, “then we are a long way from having the money that we need to move into (Fiscal Year) 2021. I think it's important that we understand that that's the reality of it as of today, so people can prepare.”
Parson, a Republican, announced the looming cuts just weeks after Republican lawmakers passed an FY2021 budget that attempted to fully fund K-12 education and keep state aid to colleges level despite obvious headwinds.
When Democrats said the plan was out of balance, Senate Majority Floor Leader Caleb Rowden, R-Columbia, dismissed their complaints as partisan nonsense.
“The fact that they would seek to use a situation like the one that we are in to now understand and grab the mantle of fiscal responsibility, one that they have never grabbed in their entire lives, is unfortunate,” he said. “I feel very comfortable with the budget we have."
Rep. Kip Kendrick, D-Columbia, said Friday that was always fantasy.
“It was clear to anyone in the budgeting process that the budget that was truly agreed and finally passed was out of balance and would require federal aid to put it back into balance,” he said.
Education leaders, who run obvious targets for more cuts because they get large portions of the state’s unrestricted money, are already bracing for the worst.
“Neither of those (rounds of withholds) are surprising given the revenue situation the state is in,” Missouri State President Clif Smart said in an interview, “but it does make it harder to do the things people think we’re good at.”
Despite losing $7.6 million to an April 1 withhold — 8 percent of the state aid promised this year — and millions more on other virus-related expenses, MSU has yet to furlough or lay off employees.
But Smart said he talked to the school’s Board of Governors last week about the potential for layoffs and salary reductions with state aid cuts and enrollment declines looming.
“We agreed we were going to hold those to the very last option,” Smart said, “but when 70 percent of your budget is personnel, it’s hard to avoid if shortfalls are large enough.”
The University of Missouri system, which lost $36.5 million in state support and has refunded student fees totaling almost $30 million, is already there.
The system has furloughed nearly 900 employees and laid off dozens of others this month after making cuts to administrative salaries and asking employees to accept voluntary reductions in April.
MU spokesman Christian Basi said more withholds would likely mean more of the same.
“Right now, we are certainly looking at every option and taking several actions,” he said, “and if we had further financial issues we would continue to do those things.”
Springfield Public Schools Superintendent John Jungmann offered fewer details in an emailed statement, citing uncertainty in exactly how much Parson will ultimately cut.
But Jungmann made clear he anticipated SPS would take a hit in both rounds and said the district is working on multiple options for the next fiscal year’s budget, which the district board will consider next month.
District spokesman Stephen Hall said avoiding personnel cuts will be a top priority.
Austin Huguelet is the News-Leader's politics reporter. Got something he should know? Have a question? Call him at 417-403-8096 or email him at firstname.lastname@example.org. You can also support local journalism atNews-Leader.com/subscribe.