Budget Withholds
3:19 pm
Tue October 1, 2013

Mo. Supreme Court Rejects Challenge To Withheld Appropriations

Missouri auditor Tom Schweich had no authority to challenge Gov. Jay Nixon's decision to withhold about $170 million from the budget for fiscal year 2012 before the spending plan actually went into effect.

That was the ruling today from six of the justices on the Missouri Supreme Court. Judge Paul Wilson did not participate.

Schweich, a Republican, filed the lawsuit back in August of 2011, arguing that the state Constitution permitted the governor to reduce expenditures only if revenue actually came in lower than expected. The suit came about a week after Schweich released an audit that was highly critical of the withholds, which Nixon said were needed to pay for disaster relief.

A Cole County judge ruled in July 2012 that Nixon was within his rights as governor to control spending, although Jon Beetem did agree with Schweich that the common practice of using placeholders instead of actual numbers in the state budget was unconstitutional.

But the state Supreme Court today did not address those issues. Instead, the justices ruled that Schweich did not have the right to challenge the withholdings in the first place:

"In sum, the auditor has exceeded his constitutional authority in challenging the Governor's constitutional power to announce in advance a withhold ... because the Auditor is limited to conducting a postaudit, which is an examination of a financial record performed after the fact."

Schweich's office released the following statement in response:

"The Supreme Court effectively ruled that we filed our suit too soon. The Court dismissed our suit without prejudice to re-file.  That leaves us with two options: do a post audit of the Governor's office now and file suit, or work with the Legislature to restrict the ability of the Governor to make withholds when there exists adequate revenues to fully fund the budget.  We will spend the next several days determining which option to pursue, or whether to pursue both options. "

In his own statement, Nixon said the ruling "confirmed once again that Missouri governors have the authority and the responsibility to rein in spending and keep the budget in balance."

"Even during tough economic times, the executive authority provided by our Constitution – and reaffirmed again by the Court today – has allowed us to maintain strict fiscal discipline and protect Missouri’s perfect AAA credit rating.  At a time of continued fiscal turmoil in Washington, this strong constitutional framework is vital to keeping our budget in balance and our economy moving forward."

Follow Rachel Lippmann on Twitter: @rlippmann