By DAVID A. LIEB
JEFFERSON CITY, Mo. (AP) - Gov. Jay Nixon said Thursday that he will not tap university reserves to help balance Missouri's budget, scrapping the idea just a few weeks after its debut generated a generally negative reaction.
Nixon's administration had floated an idea that would have taken $106 million from the reserves of five of Missouri's largest universities to help fund the higher education operating budget for the 2013 fiscal year. The reserves would have been replenished over several years with money from Missouri' student loan agency.
Asked Thursday about the idea, Nixon responded: "That is off the table."
The idea had not gone over well with some university officials and state lawmakers, whose approval would have been needed.
On Wednesday, House Speaker Steven Tilley had vowed that lawmakers "will not balance our budget by asking our state colleges and universities for a bailout."
Nixon said Thursday that he would continue to look for ways to put as many dollars as possible into the classrooms at K-12 public schools, colleges and universities - directing cuts toward the administration, as much as possible.
The governor's office has always stressed that the potential to borrow from university reserves to finance the state's budget was only an idea, not a firm plan or proposal. One thing that made the idea potentially attractive was the ability to redirect money from the Missouri Higher Education Loan Authority to finance classroom education in the immediate future instead of using agency funds for longer-term campus construction projects, as a 2007 state law requires, Nixon said.
But some lawmakers had expressed concern about whether the authority could afford to replenish university reserves. The Chesterfield-based student loan agency has skipped many of its scheduled quarterly payments to the state under the 2007 college construction law, citing concerns about its own finances.
Lawmakers were pleased to hear Thursday that Nixon had dropped the idea.
"I'm glad it's off the table. It was a ridiculous plan to begin with," said House Budget Committee Chairman Ryan Silvey, R-Kansas City.
Senate President Pro Tem Rob Mayer, R-Dexter, said colleagues in his chamber generally opposed dipping into university reserves to finance operating budgets.
"We just didn't think it was a good way to deal with the problem. Why rob Peter to pay Peter?" Mayer said.
At least some university officials had been open to the idea as a way to prevent a sharp drop in state funding from which it could take several years to bounce back.
"It was a concept that we thought was intriguing and had at least enough merit to look at in more detail," said Paul Kincaid, chief of staff to Interim President Clif Smart at Missouri State University.
Under Nixon's idea, the University of Missouri system would have been asked to provide the state $62.3 million from its reserves, Missouri State University would have supplied $13.7 million, and $10 million each would come from the University of Central Missouri, Southeast Missouri State University and Truman State University.
University of Missouri Interim President Steve Owens said in an emailed statement that officials at his four-campus system would continue working with the governor and Legislature to find ways to adequately fund higher education.
"We appreciate the governor's concern for higher education and the creativity of the idea floated by his office," Owens said.
Public relations personnel at the three other institutions either declined to comment or said officials were unavailable for comment Thursday.
Nixon's budget director has said the state could face a roughly $500 million gap between projected expenses and revenues for the 2013 fiscal year that starts July 1. That gap was the impetus for considering alternative ways of financing higher education.
"We wanted to look at an opportunity with the immediate budget challenge we had this year," Nixon said. He added: "That was one method that was looked it. It didn't pan out."