January 23, 2015

State update:

Governor announces budget requests during State of the State address

Nixon
Governor Jay Nixon delivering State of the State address (photo credit: House Communications, photo by Tim Bommel)

Governor Jay Nixon delivered the State of the State address before a joint session of the Senate and House on Wednesday evening. He challenged lawmakers to consider expanding Medicaid and pass tax amnesty to support additional spending but focused much of his remarks on the success of the state economy, particularly the auto industry. He also emphasized the need for fiscal discipline, job creation, and improving Missouri highway maintenance.

The budget is the first drafted since passage of Amendment 10 last year, which enabled lawmakers to override withholdings the Governor may make later in the process. The amendment also prohibits the Governor from including funds in his budget recommendations that depend on future actions of the General Assembly. Because of this, the Governor made his FY16 budget recommendations accordingly and also issued a separate proclamation that indicated how he would use additional funding if lawmakers passed revenue-generating bills such as tax amnesty or Medicaid expansion.

On Medicaid, the Governor noted several states led by Republican governors who have supported expansion or are considering it. He said health providers are either stopping job growth or losing jobs to neighboring states. In Missouri, some Republican leaders have not embraced expansion, citing concerns that although the state could see federal funds in the early years, there is no guarantee of future payments which could leave the state liable and cause turmoil in the budget.

For the Governor’s complete address, click here.

For a more in-depth look at the Governor’s budget proposal, click here.

To see the Republican response to the Governor’s address by House Speaker John Diehl, click here.

Higher education increase at 1.3%; maintenance and repair a centerpiece

For higher education, the Governor recommended a core performance funding increase of 1.3% over current year funding, representing an additional $12 million for higher education institutions. This would bring the University of Missouri System’s core appropriation up $5.7 million to $428,525,516. Nixon pledged in his proclamation that if lawmakers passed revenue-generating legislation, an additional $13 million in performance funding could be available across all of higher education, bringing the total possible increase for UM to 2.8 percent or $440,475,633.

In his proposed budget, the Governor did not recommend $10 million in core funding for expanding the MU School of Medicine to prepare additional students for southwest Missouri through a partnership with Coxhealth and Mercy. That program received $10 million in FY14, but FY15 funding has been withheld by the Governor and has yet to be released. The Governor’s proclamation does indicate that, if lawmakers pass additional revenue legislation mentioned above, the $10 million in funds could be appropriated in FY16.

A centerpiece of the Governor’s higher education platform for this year was $161.5 million in proposed maintenance and repair projects for higher education institutions funded by revenue bonds approved by lawmakers last year. (See related story below.)

Maintenance and repair bonding project moving forward

The Senate began work this week on a resolution outlining the maintenance and repair projects to be funded from $200 million in bonding authority approved last session. Senate Concurrent Resolution 9, sponsored by Senator Mike Parson (R-Bolivar), was introduced January 21, and considered before the Senate Rules Committee on January 22. The plan includes $12.5 million for renovation of Stewart Hall at MU; $18.3 million for renovation of Spencer Chemistry and Biological Sciences at UMKC; $12.1 million for renovation of Schrenk Hall at Missouri S&T; and $13.6 million for renovation of Benton Hall at UMSL. MU previously received $38.5 million in bond funds to begin renovation of Lafferre Hall as part of this same plan.

The resolution is expected to be considered on the Senate floor in the next week and will then move to the House, where the projects will be introduced as part of a capital improvements bill.

Campuses urge Senators to support 50-50 match projects, MU Med School expansion

Last year lawmakers approved nearly $28.5 million in matching funds for four capital projects – one on each UM campus – that were part of the 50-50 match initiative that requires institutions to raise private funds on a dollar-for-dollar basis for a state match. Those funds have been withheld by the Governor over concerns about the state budget. The University is seeking legislative support again for the FY16 budget to include these and other matches.

On January 20, representatives from all four campuses came to testify before the Senate Appropriations Committee in support of the four projects. Presenters and projects being supported included UMKC Chancellor Leo Morton for the UMKC Free Enterprise Center; project donor Bill Kennedy for the mining research building at Missouri S&T; MU Dean of the College of Business Joan Gabel for the Applied Learning Center at MU; and project donor Kirk Richter for the Business Administration project at UMSL.

The University is seeking support to direct additional bonding revenues authorized last session for these and other matches. Legislation and a resolution is expected to be introduced in the coming weeks to enable the matches.

During the Appropriations hearing, officials from CoxHealth and Mercy also appeared before the committee to urge support for the expansion of the MU School of Medicine class size. This will enable a clinical campus in Springfield to provide more doctors in southwest Missouri. John Duff, Sr. Vice President of CoxHealth; and David Barbe, Vice President of Mercy; urged the committee to include the $10 million in recurring funds in the FY16 budget to keep the expansion on track.

Bills would revitalize dairy industry, provide agriculture scholarships

This week, agriculture committees in both Senate and House held their first hearings and considered bills that would strengthen the state’s dairy industry and provide scholarships for students who are interested in a career in agriculture. These proposals were approved by lawmakers last year but vetoed by the Governor as part of an omnibus agriculture bill that contained a controversial section related to regulation of captive deer. This year’s proposals do not include that provision.

Senate Bill 12 sponsored by Senator Brian Munzlinger (R-Williamstown), and House Bill 259 sponsored by Representative Bill Reiboldt (R-Neosho), were both heard before committees this week and include provisions to establish the Missouri Dairy Revitalization Fund and the agriculture scholarships. The dairy provisions were developed with the expertise of Scott Brown, MU assistant professor of agriculture, who helped draft the Federal Farm bill last year. For UM and other higher education institutions, the bill would provide up to 80 scholarships at $5,000 per-year for students meeting specific requirements and would also enable the University to conduct research on agriculture needs of the state through the Commercial Agriculture Program in conjunction with MU Extension.

MU agriculture students Rachel Dalske of Florissant; Annie Callahan of Fulton; and Grant Voelker of Perryville; testified in favor of the bills and noted how it would be beneficial for students in the future. Tom McFadden, director of animal sciences at the College of Agriculture, Food and Natural Resources; and MU student Maddie McMillian with the Associated Students of the University of Missouri also testified in support.

The House bill was voted out of committee and now heads to the Select Committee on Agriculture. The Senate bill has also been approved by the committee and will now be placed on the calendar for floor consideration.

dairy folks

Above, left to right: Sen. Brian Munzlinger (R-Williamstown), Rachel Dalske, Annie Callahan, Grant Voelker, and Rep. Bill Reiboldt (R-Neosho) at the Senate Agriculture committee

 

Legislator Profile: Rep. Steve Cookson (R-Poplar Bluff)

Cookson

Representative Steve Cookson’s passion for education is clear as he assumes his new role as chair of the House Higher Education Committee. Cookson, of Poplar Bluff, is retired from the Ripley County R-II district where he served as Superintendent before running for the 153rd District seat in 2010. He is now serving his third term.

Cookson sees a strong connection between the University of Missouri and economic development in the state. “There is no doubt that we are able to utilize all of the research that takes place at the University to attract business,” he said. “With the different aspects on the campuses including research expertise in agriculture, medicine, the business incubators all the way up to the nuclear reactor that is the biggest on any campus. With Missouri’s location and all of the great research that is happening, we should be able to attract cutting edge business to the state.”

Cookson also notes a strong connection to the community college sector of the state, with Three-Rivers Community College in his district. As he considers pending legislation in the committee, he plans to ensure that everyone feels that they have been treated fairly throughout the process. “Bottom line, I want my committee to focus on how to increase access for higher education in Missouri at all levels.”

Cookson received his bachelor’s degree from the College of the Ozarks in Branson, and has a master’s and specialist’s degrees from Southeast Missouri State University. He and his wife Joy live on a cattle farm where he can enjoy his outdoor interests including building traditional Current River wooden John boats and carving sassafras boat paddles. A sports fan, Cookson also played on a state champion high school basketball team and was a member of the Three Rivers Raiders team that placed third in the nation in 1978.

Federal update:

President Obama delivers State of the Union address, prepares to release FY 2016 budget request

On January 20, President Obama delivered his annual State of the Union address to Congress.  His speech highlighted new proposals for higher education, including an expanded higher education tax credit for qualifying students; a plan to provide two-years of free tuition for qualifying students for community college; and a simplified Free Application for Federal Student Aid (FAFSA) form.  The speech also referenced a new precision medicine initiative that would likely be carried out by the National Institutes of Health (NIH). NIH Director Francis Collins is a leading advocate of personalized medicine.

Details on these proposals are expected to be included in President Obama’s fiscal year (FY) 2016 budget request, which will be released on February 2.  The White House has also indicated that the budget request will include funding for infrastructure and transportation projects, as well as a plan to turn back “sequestration,” which has resulted in deep cuts and difficult budget caps for discretionary spending.   To pay for the new initiatives and increase funding, the budget request will include proposed changes to the existing tax code (for example, reform to the capital gains tax).  While Members of Congress from both parties have indicated a willingness to work to reduce the effects of sequestration, and provide funding for new transportation projects, they are unlikely to support the White House plan for tax reform.

A report on the FY 2016 budget request will be included in the February 6 Legislative Update.

Keep up with key higher education legislation here.

Preview for next week’s update

An overview of state financial aid programs and their impact on University of Missouri System students.