Kentucky Senate approves its version of state budget plan

For Immediate Release

March 23, 2016

Senate approves its version of state budget plan

FRANKFORT—The Senate passed a state budget proposal on Wednesday that restores many of the governor’s priorities for the next two years, including a “permanent fund” for future pension spending, cuts to secondary education funding and performance-based appropriations for college and universities.

All in all, the Senate budget bill includes many of the cuts featured in the Gov. Matt Bevin’s January budget proposal, many of which didn’t survive the House budget plan passed last week.

Still, Sen. Chris McDaniel, R-Latonia, the Senate budget committee’s chairman, said it was a balanced effort. Not all the governor’s cuts were preserved.

“The thing I’d say I’m most proud of is that this budget is structurally balanced,” he said. “We do adopt many of the governor’s recommendations for the budget stabilization plan throughout the course of this bill, but we take monstrous steps – historic steps – on maintaining stability and introducing responsibility in addressing the most pressing problem facing us.”

That, he said, is the state pension program challenge, which has unfunded liabilities of more than $31 billion. To start reducing that figure, the Senate budget reinstituted many the governor’s cuts, including a 9 percent reduction in funding for Kentucky colleges and universities.

The budget also resuscitated the governor’s proposal to switch that funding to a performance-based model, with a quarter of the state funding to be based on student retention, graduation rates and other metrics.

The Senate removed from the spending plan a proposal from the House to establish a Work Ready Kentucky Scholarship program, which would make tuition free for high school graduates who enroll in the state’s community colleges. The House budget funded scholarships to the tune of $13 million for the 2017 fiscal year and almost $20 million the following year.

That was cut from the Senate budget, along with funding earmarked for specific projects like school renovations, the Lexington Convention Center and help for areas hit hard by a drop in the coal industry.

The Senate budget passed with only two dissenting votes, while nine Senators passed on the bill.

Sen. Denise Harper-Angel, D-Louisville, said she had reservations about cuts made by the budget, including $1.5 million to Court Appointed Children’s Advocates (CASA) programs, $15 million that was to renovate the Kentucky School for the Blind and $1 million a year to promote breast and cervical cancer screening for women.

“I believe these cuts will adversely affect women, children, families and the disabled. For these reasons and more, I pass,” said Harper-Angel, before offering that she hopes the final budget will offer “better choices.”

Sen. Brandon Smith, R-Hazard, one of two dissenting votes, admitted he was torn. He likes the effort to control the pension problem, but was disappointed in the removal of aide for stricken coal-producing areas.

“I cannot go home this weekend without casting a vote to help bring some reasoning back into this discussion,” he said.

The proposed budget did, however, include some spending not in the House budget, including $32 million in Justice Cabinet funding to fight heroin abuse – the House had reduced it to $20 million – and setting aside $250 million in the “permanent fund” for future pension fund payments. Gov. Bevin’s budget wanted the fund to include $500 million, while the House budget proposed using that money immediately on other expenditures.

The budget is soon expected to land in a conference committee so that Senate and House members can iron out their differences in each of their preferred spending plans.

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