ÃÛÑ¿´«Ã½

The Republican governor, acting on his first spending plan, signed the bulk of the state’s $50.8 billion blueprint but said he was vetoing or restricting spending on more than 240 items, including roadbuilding, sewer projects and funding for higher education.

“This excessive spending requires decisive action, particularly when combined with reduced pandemic federal dollars, broad tax cuts that benefit Missourians, and the undeniable need for extraordinary emergency disaster relief,� the administration said in a statement.

Kehoe’s action mirrors his predecessor, Republican Mike Parson, who routinely used his veto powers to reduce the budgets sent to him by lawmakers.

In 2024, for example, Parson slashed 173 projects worth $1 billion, a year after he trimmed $550 million.

Kehoe pared back more than $14 million extra that lawmakers had approved for universities and community colleges, giving them a 1.5% increase, rather than a 3% boost. The maneuver likely will require colleges and universities to rely more heavily on higher tuition rates.

He cut or reduced spending on flood mitigation plans for Des Peres and a long-sought cleanup of Kinloch in north ÃÛÑ¿´«Ã½ County, while also reducing spending set aside for refugee resettlement efforts in ÃÛÑ¿´«Ã½.

He withheld $7 million to help ÃÛÑ¿´«Ã½ Lambert International Airport build its new terminal and put on hold a $4 million grant to help build a police training facility in O’Fallon.

“We do not take this action lightly, but state government cannot spend beyond our means,� Kehoe said. “With current circumstances, the fiscally responsible and conservative thing to do is reduce spending and protect Missouri’s nationally recognized financial strength in preparation for difficult budget years ahead.�

Kehoe’s budget proposal in January projected a $1.4 billion surplus that could provide some cushion if federal cuts are imposed in Washington.

The budget he received from lawmakers put the projected surplus at an estimated $700 million after lawmakers added in millions of additional spending on items including tornado recovery costs in ÃÛÑ¿´«Ã½.

Revenue shortfall expected

Kehoe’s budget office is projecting a $1 billion revenue shortfall beginning in the next fiscal year, ending years of post-pandemic surpluses.

Kehoe’s action came a day ahead of the start of the state’s new fiscal year at the same time the Republican-led Congress is attempting to approve President Donald Trump’s massive tax bill that could shift more costs to states.

That has left state officials worrying about relying on federal dollars to keep programs at current levels.

Among changes that could have an eventual effect on Missouri is a proposal to reduce a state tax levied on medical providers such as hospitals, which nearly all states use to generate billions of dollars a year to help pay for their share of the Medicaid program.

The Missouri Hospital Association warns the reduction eventually will cost the state $1.1 billion annually.

Lawmakers sent Kehoe the package in early May, handing him victories on a handful of initiatives, including $50 million to expand the state’s private school voucher program, which is currently funded via donations.

Using public funds for private religious schools is currently barred by the Missouri Constitution, though the U.S. Supreme Court in 2022 struck down a similar restriction in Maine, placing Missouri’s ban in doubt.

As a workaround, supporters say the money will not go directly to private schools because the program will be administered by the state treasurer’s office.

Republicans said expanding school choice will give an estimated 7,500 additional students more educational options. Currently, about 2,600 students are covered by the program.

School funding left intact

Kehoe left intact a $300 million increase for school funding over what he had requested in January.

The budget plan adds $15 million to fully fund transportation costs for school districts and $33.4 million to boost teacher pay, which is among the lowest in the nation.

“We appreciate everyone’s efforts to support Missouri education throughout the state,� said state schools Commissioner Karla Eslinger. “We thank the General Assembly and Governor Kehoe for investing in public education in our state.�

The budget also includes up to 10% pay raises for longtime state employees, a $107 million expansion of child care funding and $3 million to pay for the rising cost of medicine for patients in the state’s sprawling mental health system.

The plan also includes $20 million for preparations of the 2026 FIFA World Cup in Kansas City.

Kehoe also won approval for $10 million to finance a new Blue Shield grant program to incentivize local law enforcement agencies to improve crime-fighting efforts.

There also is $7 million to test public school wastewater emissions for fentanyl.

A Senate change cut 25 positions from Secretary of State Denny Hoskins’ budget. It was inserted by fellow Republicans after Hoskins spent eight years in the Senate advocating for similar headcount reductions in state government.

The largest of the budget bills is a $17 billion outlay for the Department of Social Services, which pays for the state’s Medicaid health insurance system and other benefits for low-income Missourians.

“We support funding for education and have proudly championed tax cuts for hard-working Missouri families and the desperately needed resources for our fellow Missourians affected by natural disasters this spring. However, these initiatives do not come without budgetary consequences,� the governor said.

The legislation is Houscept for House Bill 19.