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Auditor sues governor over his 'withholds' from state budget

This article first appeared in the St. Louis Beacon, Aug. 26, 2011 - Missouri state Auditor Tom Schweich appears to have set a precedent with a lawsuit filed today that challenges a governor's right to withhold money from state budgets.

Schweich's suit against Gov. Jay Nixon accuses him of violating the state constitution "when he withheld more than $170 million from state agencies, programs and educational institutions prior to the start of the current fiscal year."

Schweich also contended that Nixon's withholdings "violate the separation of powers, and that they are arbitrary and capricious."

The lawsuit, filed in Cole County Circuit Court, appears to be the first time that a state auditor has gone to court to challenge the longstanding practice of Missouri governors to withhold money from state budgets.

Nixon's staff replied that he has acted within the constitution and his powers.

"Withholdings" are different from budget cuts, which Missouri governors can do under their line-item veto powers. Governors generally have withheld money early in the fiscal years, which begin July 1, and then released some or all -- or none -- if it appears that the state will collect enough income to restore the appropriated spending.

Governors have done so because of the state constitution's requirement that the state end its fiscal year with a balanced budget.

Schweich and his staff contend that Nixon veered from the traditional practice by A) withholding the money in June, before the fiscal year began; and B) reallocating part of the withheld money for disaster relief at Joplin, Mo., which was hit with a devastating and deadly tornado May 22.

Schweich first raised the issue in a letter to Nixon last week. The governor's staff replied that Nixon's actions were within his constitutional powers. Nixon's office took the same approach in responding to the suit.

Among other things, Schweich says that the governor "failed to utilize established accounting principles when he withheld more than $170 million from state agencies, programs and educational institutions prior to the start of the current fiscal year."

But in addition, Schweich and his staff note that Nixon's official reasons for the withholds was to reallocate the money for disaster relief for Joplin.

Schweich maintains that the governor's reasons may be laudatory, but he exceeded his powers. The auditor says that only the General Assembly can allocate money. Schweich earlier had recommended that the governor and the legislature take money out of the state's "rainy day fund,'' among other options, to pay for the Joplin relief effort.

Another issue, said Schweich, is that his staff could not obtain the necessary documents to back up Nixon's decision to withhold the money even before the fiscal year began. "The Missouri Constitution states the governor can only make withholds based on current fiscal year revenue data, at which time there was none," Schweich's staff said in a release announcing the suit.

Schweich's office lists in detail all of the state programs affected by the withholdings, which ranged from Parents as Teachers and Medicaid to the the state's prisons and universities.

But Schweich, a Republican implies that politics also may have played a role; Nixon is a Democrat. The auditor noted  "that the governor withheld funds from the Republican controlled legislature and the Republican auditor, but did not cut funds for his own office or any Democrat statewide elected official."

In reply to the suit, Nixon's office said, "The Governor will continue to fulfill his responsibility to balance the state budget, fund essential government services and help our communities recover in the wake of the many natural disasters this year, including the devastating tornado that hit Joplin. Gov. Nixon will continue to ensure that Missouri will meet its obligations to help communities recover and rebuild from these disasters."

Underscoring the politics, both state parties weighed in with comments late Friday. The state Republican Party cited quotes from various legislative leaders involved in the budget process, including state House Budget chairman Ryan Silvey, R-Kansas City, and state Rep. Chris Kelly, D-Columbia.

"It's clear that the governor does not like dealing with the legislature," said Silvey (who axed the chef for the Governor's Mansion from this year's budget.) "It's clear that he'd rather have flexibility than go along with the constitution."

The state Democratic Party asserted that Schweich was using his office to play politics.

"Missourians need a state auditor who is fair and non-partisan, but the only thing that seems to motivate Tom Schweich is politics," said Caitlin Legacki, Missouri Democratic Party spokeswoman. "While Schweich refused to objectively criticize Peter Kinder for attending fancy parties and eating lavish meals on the taxpayer's dime, he's quick to launch political attacks against any Democrat in sight. When is Tom Schweich going to realize his political campaign ended last November and now it's time to be an objective state auditor?"

Schweich v Nixon 082611

Jo Mannies has been covering Missouri politics and government for almost four decades, much of that time as a reporter and columnist at the St. Louis Post-Dispatch. She was the first woman to cover St. Louis City Hall, was the newspaper’s second woman sportswriter in its history, and spent four years in the Post-Dispatch Washington Bureau. She joined the St. Louis Beacon in 2009. She has won several local, regional and national awards, and has covered every president since Jimmy Carter. She scared fellow first-graders in the late 1950s when she showed them how close Alaska was to Russia and met Richard M. Nixon when she was in high school. She graduated from Valparaiso University in northwest Indiana, and was the daughter of a high school basketball coach. She is married and has two grown children, both lawyers. She’s a history and movie buff, cultivates a massive flower garden, and bakes banana bread regularly for her colleagues.

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