Gov Nixon Announces Withholding

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JEFFERSON CITY - Democratic Gov. Jay Nixon announced Friday he will use his authority as governor to withhold $400 million from the state budget in fiscal year 2014.

Nixon said the main reason for the withholdings is House Bill 253, which would decrease the state individual and corporate tax rates in phases over the next ten years. The bill phases in a 50 percent business deduction and a .5 percent individual income tax cut in 10 years. Nixon said he believes these cuts in funding will leave Missouri unable to fund major programs.

"House Bill 253 is a fiscally irresponsible, ill-conceived experiment that would undermine Missouri's strong fiscal foundation and weaken our economy now, and for years to come," Nixon said in a press release Friday. 

Nixon has already vetoed HB 253, but he said he believes the state legislature will override the veto, so he is planning accordingly.

Missouri Chamber of Commerce CEO Dan Mehan, a supporter of HB 253, said Nixon is playing political games by announcing this move.

"It's simply playing politics," Mehan said. "Announcing these cuts in a year we had a budget surplus is just instilling a sense of fear that that doesn't need to be there."

The cuts include nearly $100 million to building construction and repair in the mid-Missouri area. One of the building cuts eliminates a $13 million project to reconstruct Fulton State Hospital.

The cuts also include $66.4 million to transportation, $45.7 million to Medicaid provider rate increases, and the elimination of 1000 state government jobs.