Governor Kehoe Delivers State of the State Address

On the anniversary of his inauguration as Missouri’s 58th Governor, Mike Kehoe addressed the Missouri General Assembly with the 2026 State of the State speech, outlining his legislative agenda and budget recommendations for Fiscal Year 2027. Kehoe’s address focused on fiscal responsibility, as he proposed a conservative budget aimed at aligning ongoing state spending with reliable revenue sources, moving away from the extraordinary federal funds and increased general revenue that characterized the past few years.

The governor emphasized a return to sustainable, pre-pandemic financial practices, stating, “Today, we delivered a budget recommendation that focuses on the core functions of government and how we can best serve Missourians without overpromising and overspending. Our recommendation proves that state government can live within its means, and our economy can grow and deliver results for taxpayers all at the same time.”

Since Fiscal Year 2022, Missouri has added over 3,400 new budget items, with nearly $13 billion in new general revenue spending. To address a projected future imbalance of more than $2 billion, Kehoe’s plan proposes over $600 million in reductions to the general revenue core operating budget. These cuts, he said, would maintain fiscal discipline while ensuring continued support for mandatory and high-priority obligations such as Medicaid matching, child care subsidies, and disaster relief. Notably, the plan does not reduce core funding for higher education or the K-12 foundation formula.

Governor Kehoe also used his address to advocate for the eventual elimination of Missouri’s individual income tax, calling for a responsible and sustainable approach. He urged lawmakers to pass a joint resolution placing the phased elimination of the income tax before voters on the ballot this year, allowing legislative action in the next session if approved.

Kehoe outlined potential new revenue sources from untaxed modern services and described safeguards in his plan, including triggered reductions to the income tax rate, to protect the state against economic downturns. He assured Missourians that he would not support extending sales taxes to agriculture, healthcare, or real estate, emphasizing the need for a tax code fit for the state’s future.

Looking back on his first year in office, Kehoe highlighted progress in his administration’s four key areas: public safety, economic development, agriculture, and education. He detailed his ongoing commitment to these priorities with both legislative proposals and budget recommendations presented to the General Assembly.

In conjunction with his address, Governor Kehoe signed four executive orders. Executive Order 26-01 creates a statewide school accountability A-F grade card. Executive Order 26-02 affirms the administration’s commitment to safe and effective use of artificial intelligence in state government. Executive Order 26-03 establishes the Missouri Government Responsibility, Efficiency, Accountability, and Transformation initiative, or Missouri GREAT, to improve government efficiency. Executive Order 26-04 forms the Advanced Nuclear Energy Task Force to promote nuclear energy deployment within the state.

KPGZ News – Brian Watts contributed to this story.