Missouri Gov. Mike Parson says at least two more rounds of cuts to state spending will be necessary to balance the budget amid the coronavirus-induced downturn.
“COVID-19 is unlike anything we have ever faced before,” Parson told reporters last Tuesday. “As a result, we have to take a hard look at our budget and make some very difficult decisions.”
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.
He didn’t say how much would be withheld in either round, but he told education officials he anticipates having to cut up to $500 million to $700 million around July 1 and made clear the cuts they’ve already experienced won’t be the last.
Parson said 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, then we are a long way from having the money that we need to move into 2021,” he said, referring to fiscal year 2021, which begins July 1. “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 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.
The University of Missouri system, which lost $36.5 million in state support and has refunded student fees totaling almost $30 million, has furloughed nearly 900 employees and laid off dozens of others 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.”