Gov. Nixon makes plans for federal funding

Nixon looks at increasing Medicaid, with some opposition from the GOP.

By Andrew Denney

Published Feb. 20, 2009

Missouri could receive billions from the White House's stimulus package, but state leaders are divided on how and when the money will be spent, if at all.

After the passage of the $787 billion stimulus package Tuesday, Missouri could be eligible to receive over $4 billion in stimulus dollars, with $1.6 billion made available to fund the state's Medicaid program, according to the Government Accountability Office.

Gov. Jay Nixon has wasted no time making plans for the stimulus funds. In his budget proposal, submitted to the Missouri legislature on Jan. 27, Nixon figured in $809 million of stimulus money to fund the state's departments.

In addition, he has pledged to maintain or even expand certain government programs, such as Medicaid, which Nixon said he would expand by more than 60,000 Missourians.

On Thursday, the governor signed an agreement with the U.S. Department of Labor that would provide an extra $25 a week from the stimulus funds to unemployed workers, which could begin as early as March 3.

Nixon unveiled a broad, three-point plan Wednesday to spur economic growth in the state using the federal funds. While he was unable to give any exact figures, he said he would pursue any federal dollars available to the state to expand education and job training programs, enhance infrastructure by improving roads and expanding rural Internet access and attracting technology-based jobs based in life sciences and alternative energies.

Nixon said 1.3 million Missourians do not have the Internet, and states can compete for pools of funds established through the package for the expansion of Internet access.

"I'm committed to competing for all of these competitive dollars and moving this economy forward," Nixon said. "I don't think we should walk away from this once in a generation opportunity."

Republicans have been supportive of Nixon's plans to expand jobs. His Show Me JOBS plan, which would give tax credits to businesses, proposed shortly after his election, won the praise of GOP leaders.

But they have not been receptive to Nixon's plans to expand services, especially with stimulus dollars, which might not have a substitute after the stimulus money is no longer available.

Senate President Pro Tem Charlie Shields, R-St. Joseph, said the federal money should be used for "one-time" projects, such as job training and rural Internet expansion.

"We want to make sure we're not creating something that cannot be sustained in the future," Shields said.

Nixon's promise to add recipients to Medicaid is essentially the undoing of a move made by his predecessor, former Gov. Matt Blunt, who minimized eligibility for the program in 2005.

Gary McElyea, a spokesman for Lt. Gov. Peter Kinder -- a Republican in office during Blunt's term -- said because Blunt made the unpopular choice of removing recipients from Medicaid, Missouri was able to avoid some of the deep budget deficits other states are facing.

Nixon's office projected a deficit of more than $300 million in the next fiscal year. Compare that to Illinois, which has projected a $9 billion deficit, and California, which is expected to more than $42 billion.

But Missouri's total revenue is smaller this year than the last, and Nixon and the GOP have pledged not to raise taxes in the state. Also, it is against the Missouri Constitution to not have a balanced budget.

Although Missouri is not as bad off as other states in terms of budget deficits, according to Amy Blouin, executive director of the Missouri Budget Project, the state "underperforms" in terms of providing affordable health care to its residents.

Blouin said the federal stimulus dollars would be applied to a matching formula, in which, for 40 cents of each state dollar used for Medicaid, 60 cents will be applied to that dollar by federal funds. For children, she said, the rate is 30 cents by the state and 70 by the federal government.

To qualify for Medicaid in Missouri, Blouin said, a family of three would have to make no more than $292 a month.

According to the Institute of Medicine, being uninsured is the leading preventable cause of death for persons aged 25 to 60, and the sixth leading cause of death for that age group.

-- Staff writer Greg Young contributed to this report.