Missouri Governor Urges Foundation to Make Big Investment in State Programs

Missouri Gov. Matt Blunt is pressuring the Missouri Foundation for Health, a supporter of local nonprofit health organizations in the state, to start providing nearly as much as it gives away each year to help cover the cost of state programs.

The $1.3-billion foundation, in St. Louis, has rejected the calls from the Republican governor, saying such a major shift in spending would cripple the nonprofit organizations it supports.

The spat is politically charged. The presumptive Democratic candidate for governor in this year’s election, Jay Nixon, is now the state’s attorney general, and the foundation was formed in 2000 to settle a lawsuit Mr. Nixon had brought against Blue Cross Blue Shield of Missouri after the charity decided to convert to for-profit status.

Mr. Nixon appoints the foundation’s community advisory committee, which then selects candidates to serve on the foundation’s board of directors.

In a letter to the foundation in February, Mr. Blunt said the state had a claim to the foundation’s assets because of the favorable tax treatment that Blue Cross Blue Shield received from the state as a nonprofit organization.

“It was pretty shaky logic on the part of the governor,” says the foundation’s chief executive, James Kimmey.

The St. Louis Post-Dispatch criticized the governor’s request in a recent editorial, saying his argument would “seem to allow the governor to lay claim to money held by other nonprofit groups, which include most of Missouri’s hospitals and charities. Like the foundation, they pay no income, sales, or property taxes.”

Governor Blunt, who is not seeking re-election, and his spokesman, Rich Chrismer, did not return phone calls from The Chronicle. Mr. Chrismer has told other newspapers that the governor has no intention of seeking assets from other nonprofit institutions.

Governor Blunt’s latest letter to the foundation was sent on the same day the foundation created a new Web site, http://covermissouri.org, focused on the 772,000 Missouri residents who have no health insurance. More than 100,000 Missouri residents lost coverage as a result of Medicaid cuts pushed by Mr. Blunt.

Mr. Blunt wants the foundation to provide $51-million per year to pay for state programs that focus on childhood obesity and mental health and to finance local health centers. The governor says that a partnership between the state and the foundation would lead to more-efficient spending through greater economies of scale.

In 2007 the foundation spent $61-million, primarily on programs carried out by nonprofit groups that provide care to poor and uninsured people. Since 2003 the foundation has spent more than $9-million to help cover the cost of state programs.

But Mr. Kimmey says that the governor’s proposal to use more than 80 percent of its grant-making budget to support state programs would lead to sharp reductions for the nonprofit groups that the foundation currently helps.

“This would mean taking money from community agencies and putting it in state government for things the legislature didn’t even want the state to fund,” he says.

Control of Foundation

Republicans in the state legislature have twice introduced legislation that would put control of the foundation under the governor, but the bills were later withdrawn.

Conservative critics have referred to the foundation as Mr. Nixon’s “slush fund,” in part because of grants totaling $700,000 over the past five years for advocacy studies conducted by the Missouri Budget Project.

Mr. Kimmey describes the Missouri Budget Project as “progressive in its views” and says the foundation supports it because uninsured people don’t have the same resources for lobbying that tobacco and insurance companies and hospitals enjoy. “We felt it was a good decision to give the uninsured and disenfranchised the opportunity to be heard,” Mr. Kimmey says. “Had there been conservative organizations that wanted to do something about the poor and uninsured, we would have helped pay for their studies.”

Mr. Kimmey expects the foundation to continue to be in the headlines. “Once the Republicans have their nominee for governor, our expectation is that we’ll continue to be caught up in a bit of a political football until November,” he says.