With the Governor’s State of the State tomorrow and the General Assembly preparing for budget deliberations for the next fiscal year, Missouri is facing general revenue fund tax levels that are at near record lows as a result of a variety of tax cuts over the last two decades.
“Quality education, reliable infrastructure, and a solid safety net when times are hard are all necessary to create and maintain good jobs and a good quality of life in Missouri,” said Amy Blouin, Executive Director of the Missouri Budget Project. “But because Missouri’s revenue has failed to keep pace with the economy, instead our state is struggling to fund education, health, and other services that develop our human capital.”
Relative to the size of the economy, net general revenues are at record lows, which has had a significant impact on Missouri’s ability to spur the economy and meet state needs. If the state’s revenue relative to the economy had been similar to that of 2004 (much lower than both most of the 1980s and 1990s) the state would have realized an additional $715 million – enough to fully fund the K-12 education formula and meet many other needs.
“The tax cuts of the last two decades have cost Missourians more than $1 billion,” continued Blouin. “Hard-working Missourians deserve better. They deserve an economic plan that invests in their children, builds the infrastructure that attracts quality jobs, and ensures a safety net when their families hit hard times.”
In addition to protecting and enhancing general revenue through tax policy, the legislature this year has the historic opportunity to net tens of millions of dollars by expanding its Medicaid program. As shown in a previous Missouri Budget Project report, Medicaid expansion would actually save the state $81 million initially and eventually up to $100 each year – funding that could be used to fund education or other services that would boost the economy.
The Missouri Budget Project is a nonprofit public policy analysis organization that analyzes state budget, tax, and economic issues.