This article first appeared in the St. Louis Beacon, March 18, 2009 - In 2000, Republican Jim Talent almost won his bid for Missouri governor with a highly effective TV ad campaign asserting that Democrats, who then controlled the Legislature, had failed to fulfill the state's promise to use the income from the state's gambling casinos to increase spending for education.
The state's percentage spent on education had actually gone down in the 1990s, Talent showed, because the gambling money had been used to replace -- not augment -- state general-revenue money in the education budget. The state money had been diverted to other uses.
That same argument is now being leveled by Missouri Democrats, as they point to how Republican legislators, who now control the Legislature, are proposing to use a large chunk of the stimulus money.
House Budget Committee chairman Allen Icet, R-Wildwood, has acknowledged that he is using $625 million in federal stimulus money that must be spent on education to replace state general-revenue money that had been designated for the education budget.
The general-revenue money can now be spent somewhere else.
"We're trying to understand what the federal government is going to require," Icet said. "It's a little bit of flying blind here by everybody in the building."
Icet contended that he was shifting money around to guarantee that "we could pull down every dollar we can from the federal government."
That's a sharply different approach than some Republican leaders were espousing a month ago, when they proposed that the state consider rejecting the federal stimulus money or return it to Missouri taxpayers in the form of tax cuts.
Icet's action also doesn't appear to fit with Republican calls for reserving the federal stimulus money for "one-time projects,'' like constructing a bridge. In fact, the budget chairman appears to be acting more in line with Gov. Jay Nixon's initial plan to use some federal money to balance the state's budget.
State Rep. Chris Kelly, D-Columbia, said he expected many states were doing the same thing. Kelly served as Missouri House budget chairman during an earlier 12-year stint in the chamber in the 1980s and 1990s, before term limits.
Kelly said he had no problem with Icet's decision to supplant funds.
"He's essentially laundering federal money," Kelly said of Icet. "And every budget planner from Honolulu to Bangor ... right now has soap suds up to their elbows from laundering federal stimulus money. We're all doing it. We all ought to do it."
INSIDE THE MAGIC BOX
But Democrats take issue with the way Icet has placed the diverted general-revenue money into what Kelly dubbed a "magic box" so that it can be reserved for other uses, or future years.
It's a move that has left some Democrats fuming.
"Instead of using almost $800 million in federal money ... on important things like health care, the Republicans decide not to use that and move into an ideological bent that there's no way that they should use that money at all," said House Minority Leader Paul LeVota, D-Independence. "It's very disappointing."
State Rep. Rachel Storch, D-St. Louis, says the bottom line is that Republicans controlling the Legislature don't want to use the federal money for the reasons that Missouri is getting the money.
"The federal government is sending us money to bail out Missouri families and Republicans are saying 'No','' Storch said. "They are willing to walk away from people's needs. There is not the will to spend it on social services."
Kelly said he's somewhat sympathetic to Icet's "idea of putting some of the money aside for next year.''
But Kelly argues that legislators should be able to debate it. But because of the procedures Icet is using, Democrats can't do so.
Asked at a recent press conference, Icet said he expected the Missouri Senate to make further cuts to the state budget to boost the state's cash balance at the end of this fiscal year on June 30.
DEFINING ONE-TIME MONEY
Republican legislative leaders generally have argued that federal stimulus money should be used for "one-time'' projects or expenses, so the state isn't saddled with having to come up with state general-revenue money to pay for new programs or services when the federal money runs out.
Icet acknowledges that the "one-time" term can be subjective.
For instance, some Republicans have suggesting using stimulus cash for construction projects. State Sen. Kurt Schaefer, R-Columbia, has proposed using federal money to pay for a new Ellis Fischel Cancer Center in Columbia.
Yet such a center would require annual state spending in future years to pay for staff, utilities and equipment.
House Speaker Pro Tem Bryan Pratt, R-Blue Springs, said some House Republicans would prefer using federal money to refurbish existing facilities or roads, as opposed to new construction projects.
"We talk in broad pictures about how we're going to spend money on roads, how we're going to spend money on one-time projects. The devil is going to be in the details," Pratt said. "If you re-pave a portion of Interstate 70, that's a one-time expenditure. If you're going to build a brand new building, we've got to keep into consideration that there's going to be some ongoing investment to keep that building going."
The upshot: "I don't know if you're going to see a lot of brand new buildings popping up," Pratt said.
Icet and Schaefer, however, don't object to new construction. "One-time projects are generally construction projects," Schaefer said. "Things that may have some ongoing maintenance, but the large start-up capital cost is the building of the thing."
Rep. Rick Stream, a Kirkwood Republican who is the vice chairman of the House Budget Committee, said his party generally supports allocating stimulus money to construction projects. Stream said some "one-time" programs that could benefit from stimulus funds include transportation projects, the construction of university structures and the establishment of a statewide inoperability system.
Stream said that method is preferable than expanding existing programs.
"We didn't want to use it ... to expand programs," Stream said. "I think if you look at what some of the budget activity in committee work has been, it's been to expand programs," such as SCHIP, or health care for children, and Medicaid.
But Stream noted the budget must go through a number of steps before reaching a conclusion. That includes debating the budget on the House floor, sending the bills to the Missouri Senate and hashing out disagreements in conference committees.
Rep. Dwight Scharnhorst, R-St. Louis County, said bolstering ongoing programs with finite sources of revenue would set up people for “pain and disappointment.”
“When you’re looking at one-time money, you better be sure what you’re buying and if you can sustain it,” Scharnhorst said. “And I know that probably sounds to a lot of people like we’re uncaring. But no, I think it’s more uncaring to make promises to people that you can’t sustain. That’s a common sense kind of thing that we advocate. And you know, in a touchy-feely world, it probably doesn’t play as well as we like.”
Instead, Scharnhorst said using stimulus funds on projects such as a state interoperability system would be a more prudent extension of resources.
An investment in a system allowing for emergency personnel to communicate with each other, Scharnhorst said, would be beneficial if a major disaster ever occurred in the state.
"I think this is the perfect kind of situation for public safety," said Scharnhorst, who is the chairman of an appropriations committee dealing with public safety and corrections. "Buy this thing now at one-time prices, take care of it and be in a situation where Missouri's 5.2 million citizens are protected by our safety personnel."
Democratic minority leader LeVota would like to see a mix in how the stimulus money is used. Some could go for one-time costs, he said, while some stimulus aid should be used to bolster state services to Missourians who are suffering from loss of jobs, health care and pensions.
"The purpose of the economic recovery from the federal government is to get money flowing in the state of Missouri," LeVota said. "We should be open to whatever works to build the economy."
Beacon political reporter Jo Mannies contributed to this story.
Jason Rosenbaum, a fomer state government reporter for the Columbia Daily Tribune, contributes to Missouri Lawyers Weekly and KBIA radio in Columbia.
