A constitutional amendment to limit the governor's ability to maintain a balanced budget has some experts concerned that it could cause financial problems for the state down the road.
Amendment 10, which will appear on Tuesday's ballot across Missouri, would change the governor's power to maintain a balanced budget by requiring the Legislature's approval any time the governor reduced the amount of money budgeted to a state agency. Lawmakers sent the proposal to the voters last spring.
What is a budget restriction?
Budget restrictions, sometimes called withholds or impoundments, are decreases in funding to state agencies and departments. Restrictions are imposed by the governor after the budget already has been passed by the Legislature.
Marvin Overby, University of Missouri political science professor and expert on legislative procedure, said the governor has the power to withhold funds from state entities to avert a potential budget deficit if revenue for the current fiscal year might not be as much as expected.
If the governor determines revenue will exceed expenditures, the funds can later be released. Missouri's Constitution mandates the budget be balanced, so the governor sometimes has no choice but to restrict funding, Overby said.
Gov. Jay Nixon has restricted $625 million of general revenue for the current fiscal year that began in July. Nixon has since released about $168 million.
Nixon has restricted a total of $1.96 billion in his total time as governor and released slightly more than one-third of that money.
What the amendment would change
The amendment would allow the Legislature to override budget restrictions.
If the amendment passes, the Legislature would override the governor's decision in the same process by which it overrides vetoed bills - getting at least a two-thirds vote in both chambers.
The amendment also would prohibit the governor from using estimated revenue from bills that have not been passed yet by the Legislature when making budget assessments.
That portion of the amendment was included after the governor and legislators disagreed in December about projected revenue in fiscal year 2015.
Legislators estimated a growth of about $8.6 million dollars while the governor's office estimated about $8.73 million - a difference of about 5.9 percent.
According to Nixon's office, restrictions had to be made this fiscal year because the Legislature handed out tax breaks at the end of the legislative session that could cost the state up to $483 million in reduced revenue.
Why restriction power exists
The state Constitution requires the governor to balance the budget. But if revenue projections change and begin to fall short, the governor has the power to withhold funding to prevent the state from incurring debt.
Overby said the proposed amendment looks mainly like a political maneuver, but may have unintended consequences for the state.
If the governor can't make adjustment to the budget without legislative approval, the state could end up with a deficit, he said.
Executives, like governors or presidents, have historically had the power "to correct the problems the Legislature creates" to avoid a budget deficit at the state and federal level, Overby said.
Credit rating in jeopardy
Missouri's credit rating could be lowered if Amendment 10 passes, according to a Standard & Poor's report released July 8.
The state currently has an AAA credit rating - the highest credit rating given by Standard & Poor's. A high credit rating is indicative of a strong economy and means local governments pay lower interest rates on bonds.
The report states that even though the governor still would be constitutionally required to maintain a balanced budget, the amendment would "reduce the flexibility to make changes to balance the budget and make the process more difficult."
Since the governor's restriction power specifically is mentioned in Standard & Poor's reasons for assigning the AAA rating, changing that could result in a lower credit score for the state.
"We believe this amendment could potentially weaken the state's strong governmental framework to make mid-year budget adjustments, which in our view could potentially lower the rating to a level in line with our indicative rating under our state scoring methodology," the report reads.
Scott Holste, the governor's press secretary, stated in an email that the governor's ability to control spending is "vital" to Missouri's credit rating and to maintaining financial stability.
"The governor has made clear that amending the constitution to weaken Missouri's strong safeguards against overspending by the legislature would be fiscally irresponsible," he wrote.
Holste stated that the amendment appears to be another attempt by the Legislature to overstep its boundaries.
"Like past governors, Gov. Nixon has used his constitutional authority to balance the budget and prevent government from spending beyond its means," he wrote.
Legislators split on amendment
Republicans and conservative groups, like the Missouri Club for Growth, support the amendment because they think Nixon has used his power for more than what it's intended to do. Democrats argue that the amendment is merely a political move by Republicans who are unhappy with Nixon's decisions.
State Rep. Marsha Haefner, R-St. Louis, co-sponsored the amendment when it passed through the Legislature as House Joint Resolution 72. She said she supports the amendment because the governor's restrictions have been unpredictable.
Haefner said the governor's duty is to withhold money when he thinks there is going to be a shortfall of cash based on the budget passed in the Legislature.
But she said that's not always the case.
"The governor has abused his powers of withholding," she said. "I don't think anything should be cut unless we're short on money."
Haefner said the governor is given power to withhold budgeted funds to ensure he maintains a balanced budget, but that Nixon has used his withhold power for reasons beyond his constitutional authority.
"There needs to be more thought and oversight when he's making these cuts," she said. "You don't take money away before you don't know that there won't be enough money."
Despite what Haefner calls "arbitrary" cuts, representatives on the other side of the aisle argue that Republicans support the amendment because they have a problem with Nixon, not the constitutional power itself.
State Rep. Mike Colona, D-St. Louis, said Republicans are going to regret making this decision when political parties are reversed.
"If supermajorities change, and they will, Republicans are going to go from thinking this is the best thing in the world to the worst thing in the world," Colona said.
Those who support this amendment on the belief that the governor is overstepping his constitutional authority are in the "extreme minority," he said.
"There are a small number of folks in both parties who view this more from an academic, constitutional authority perspective," Colona said.
He said the Missouri Constitution requires the state Legislature to pass a balanced budget. The governor's ability to withhold funding "is one of those tools necessary" to maintain a balanced budget, he said.
"If the shoe were on the other foot, they would be applauding the Republican governor for not spending money," Colona said.