Schweich v. Nixon, 408 S.W.3d 769

Background

In June 2011 the Governor announced he would withhold FY 2012 funds: >$600,000 from the legislature, $300,000 from the State Auditor’s office, and $6 million from the judiciary.
The Auditor filed for declaratory judgment and injunctive relief before FY 2012 began, challenging the Governor’s authority under Mo. Const. art. IV, § 27 to (a) announce withholds before actual revenues were known and (b) authorize expenditures in excess of stated amounts via “E” (estimated) appropriations.
The Governor defended that announced withholds were nonpermanent allotments to control spending and were within his § 27 duty to balance the budget; “E” appropriations are common in areas with uncertain dollar needs.
The trial court split the relief; both parties appealed to the Missouri Supreme Court, which has exclusive jurisdiction over challenges to appropriations.
The Supreme Court evaluated justiciability (standing and ripeness) and constitutional limits on the Auditor’s powers under Mo. Const. art. IV, § 13 (post-audit authority and limits).

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Does the Auditor have standing to challenge the Governor’s announced withholds to third parties before the fiscal year ends?	Auditor: Yes — §27 authority to reduce expenditures applies only when actual revenues are below estimates, so pre-fiscal-year announcements exceed Governor’s authority and can be reviewed.	Governor: No — announcements were temporary allotments to control rate of expenditure under §27; Auditor lacks authority to preaudit.	No standing: Auditor may not bring preaudit challenge to Governor’s actions toward other offices; his constitutional duties are limited to postaudit.
Can the Auditor challenge the Governor’s treatment of "E" appropriations in a pre-fiscal-year suit?	Auditor: "E" appropriations allow later excess spending and the Governor cannot authorize expenditures in excess of legislative specificity; pre-fiscal review is needed.	Governor: Handling of "E" items is part of his §27 allotment power and balancing duty; announcements were not final.	No standing: Same rationale — Auditor exceeded constitutional authority by seeking preaudit review of "E" appropriations.
Does the Auditor have standing to challenge a $300,000 withhold from his own office?	Auditor: Yes — a direct, adverse, pecuniary interest exists if the withhold is unauthorized.	Governor: Withhold may be an allotment or reduction under §27 and may be temporary pending revenue results.	Standing exists as to Auditor’s own appropriation.
Was the Auditor’s claim regarding the $300,000 ripe for declaratory relief before FY 2012 ended?	Auditor: Case is ripe because Governor announced a specific $300,000 withhold affecting Auditor’s operations.	Governor: Not ripe — until FY 2012 closes and actual revenues are known, court cannot determine whether a permanent reduction occurred or merely timing control.	Not ripe: Claim was premature; relief unavailable until facts (revenues and final expenditure) are developed.

Key Cases Cited

CACH, LLC v. Askew, 358 S.W.3d 58 (Mo. banc) (standing is question of law reviewed de novo)
Mo. Soybean Ass’n v. Mo. Clean Water Comm’n, 102 S.W.3d 10 (Mo. banc) (declaratory relief requires ripeness; no hypothetical adjudication)
Director of Revenue v. State Auditor, 511 S.W.2d 779 (Mo. banc) (distinguishing postaudit from preaudit; Auditor’s authority is post hoc verification)
Kelly v. Hanson, 931 S.W.2d 816 (Mo. App.) (state officer capacity to sue to enforce constitutional duties)
State ex rel. Sikeston R-VI Sch. Dist. v. Ashcroft, 828 S.W.2d 372 (Mo. banc) (Governor’s power to reduce expenditures ripe only after revenues fall below estimates)