Missouri budget compromise holds K-12 and higher education aid flat

Missouri lawmakers on Monday, May 4 worked out a compromise budget that leaves basic state aid to public schools and higher education unchanged, declining to fund the $190 million cost of a 2024 education law requested by the Department of Elementary and Secondary Education.

Final votes are expected Wednesday, May 6, two days ahead of the constitutional deadline to pass spending bills. Over about six hours of negotiations, House Budget Committee Chairman Dirk Deaton and Senate Appropriations Committee Chairman Rusty Black presented a deal largely worked out in private.

Their recommendations were mostly accepted with few changes. While final figures were not available late Monday, the spending plan for the fiscal year beginning July 1 is expected to land between the $50.8 billion approved by the Senate and the $52.4 billion approved by the House.

General revenue spending will be about $16 billion, requiring up to $2.4 billion from surpluses accumulated between 2021 and 2023 to bridge the gap with expected revenue. In January, Republican Gov. Mike Kehoe asked for $54.5 billion in total spending and $16.3 billion in general revenue appropriations.

“We are still well below what the governor proposed,” Deaton said after the work concluded. The general revenue fund balance, which once stood at $5.7 billion, was down to $2.9 billion at the end of April and is expected to be all but exhausted by the end of the coming fiscal year.

The committee’s work began with public school funding and ended with a debate over a boost for voucher funding. The foundation formula, the main program supporting public schools, would receive the same $4.3 billion appropriation in the coming year as it did this year.

But differences in how each chamber funded that amount opened the door for Democrats to argue that the $190 million to fully fund the formula as state law indicates was available. The House used $64 million from surplus money in the Blind Pension Fund to replace general revenue; the Senate did not.

The Senate plan tapped $118 million set aside for Capitol Building work; the House left that untouched. “Here’s an opportunity to be able to do both,” said Sen. Maggie Nurrenbern, a Democrat from Kansas City, urging negotiators to consider combining the approaches.

The deal crafted by Deaton and Black trimmed the amounts from each fund and adopted a more optimistic forecast for Missouri Lottery revenues than the Senate had used. Black cautioned against adding “maybe money” that schools might not receive if vetoes occur or revenues fall short.

If lottery proceeds exceed expectations, he said, lawmakers could deliver additional funds in a supplemental spending bill next year or hold them for future years. “Being at a point now where we can’t fund those things, I don’t see it as a horrible thing because when it does turn the other way, that money is going to be there,” Black said.

For community colleges and state universities, the compromise means no abrupt shift to an enrollment-based funding model floated in the House. That approach would have redivided $184 million for community colleges and approximately $820 million for four-year universities based on student counts, a change that could have cut some institutions by 40% or more.

With votes planned for Wednesday, May 6, the budget’s final size, reliance on prior-year surpluses, and flat education aid set the stage for potential midyear adjustments if revenues outperform the new projections.