Sign in Subscribe
Legislative bills

Missouri Governor Vetoes $300 Million in Budget Funds, Issuing 208 Line-Item Veto Points

Strategic Insights

— 1 min read

As part of his effort to reduce state spending, Missouri Governor Mike Kehoe released his budget plan, implementing a series of vetoes and restrictions on earmarked state funds. While lawmakers had added 248 earmarked items to the spending plans, Kehoe's vetoes eliminated 109 items, reduced 23 by the line-item veto, and put restrictions on another 23. The governor cited the need to address state revenue issues, which he claimed were being squeezed by extra spending for public schools, tax cuts, and disaster relief.

Key Takeaways:

  • The governor's vetoes and restrictions eliminated 109 earmarked items, totaling $300 million in general revenue.
  • An additional 23 earmarked items were reduced by the line-item veto, while 23 more were put under restriction.
  • The vetoes were necessary due to concerns over future state revenues, which are projected to decline.
  • The governor's actions reduced the total budget from $53.4 billion to $50.8 billion and general revenue from $16 billion to $15.5 billion.
  • Major new spending items in the budget include a $300 million increase for the foundation formula in public schools and $107 million to revamp the child care payment system.
  • The surplus revenue used in the budget represents money accumulated when tax collections increased at double-digit rates for two years and the state substituted federal COVID relief funds for general revenue spending.

Statistics:

  • The governor issued 208 line-item vetoes and put restrictions on 32 expenditure items.
  • The budget passed by lawmakers had 450 items and nearly $775 million spending Kehoe did not recommend.
  • Revenues for the current fiscal year are exceeding expectations, with an increase of $216 million more than anticipated when the budget was written and $31 million more than an updated estimate made in December.
  • The Office of Administration's Division of Budget and Planning estimates a nearly $1 billion shortfall in general revenue starting in fiscal year 2027.

Sources:

  • (https://oa.mo.gov/sites/default/files/Fiscal_Year_2026_Veto_Summary.pdf)
  • (https://missouriindependent.com/2025/04/29/missouri-senate-to-debate-budget-with-450-million-in-spending-on-pet-projects/)
  • (https://missouriindependent.com/2025/05/07/missouri-bill-exempting-capital-gains-from-income-tax-sent-to-governor/)
  • (https://missouriindependent.com/donate/?oa_referrer=midstorybox)

Read more