Missouri Budget Warning: State Auditor Urges Immediate Action to Prevent Projected $1.7 Billion Deficit

Jefferson City, Mo. (KFMO) - State Auditor Scott Fitzpatrick is urging Governor Mike Kehoe to take immediate steps to rein in state spending as Missouri faces what officials describe as a rapidly widening budget gap heading into Fiscal Year 2027.

In a new report released by the auditor’s office, Fitzpatrick warns that the state’s General Revenue Fund is now projected to run a deficit of more than $1.7 billion in FY 2027. The report also projects the state’s remaining General Revenue balance, once as high as approximately $5.8 billion in FY 2023, will fall to about $600 million by the end of FY 2027 and could be fully depleted early in FY 2028 if current trends continue.

“The numbers are right there in black and white, and unfortunately lots of red,” Fitzpatrick said in the report, pointing to what he describes as an unsustainable pattern of deficit spending. He added that while budget cuts are difficult, acting early would prevent more severe reductions in the future.

The report also notes that despite earlier warnings before the 2026 legislative session, Fiscal Year 2027 budgeting resulted in an authorized increase in General Revenue spending rather than a decrease.

Fitzpatrick says the state has multiple tools available to address the issue, including line-item vetoes, spending withholds, and vetoing legislation with significant fiscal impacts.

The auditor’s office also highlighted longer-term concerns, including Missouri’s revenue growth not keeping pace with spending increases. According to the report, state revenue rose 45.8% from FY 2020 to FY 2025, while expenditures increased by about 53.4% over the same period, more than double the rate of inflation.

The updated analysis also warns that budget pressures could worsen due to lower-than-expected tax growth, supplemental budget increases, reliance on one-time funding sources, and potential mandatory cost increases in FY 2028 and beyond.

Fitzpatrick says without corrective action, Missouri risks exhausting its General Revenue reserves within the next two fiscal years.