Democratic Gov. Andy Beshear has unveiled his proposal for how the state should spend its money over the next two years, laying out a plan to provide raises to state workers and put more funding towards education by raising about $1.5 billion in new revenue.
Kentucky’s two-year budget is currently about $21 billion.
In his address Tuesday night, Beshear said his budget prioritizes education and would end “fourteen years of painful cuts.”
“The last fourteen years of cuts did not simply cut the fat. They went deep into the bone year after year after year,” Beshear said.
“We have structured a balanced, responsible budget that makes no new cuts to our general fund.”
Beshear’s plan will be considered by the Republican-led legislature as lawmakers gather to write the spending plan during this year’s budget-writing session, which ends on April 15.
Legislators have been bracing for another challenging budget as economists predict that tax revenue growth will be lackluster over the coming years.
But Beshear says his budget plan is the first since 2008 that has “no cuts,” providing slight increases to current spending.
House Speaker David Osborne said that Beshear had not briefed Republican leaders on the budget and criticized the governor for providing reporters a briefing earlier in the day.
“We just have no idea what is in the document at this point so it’s impossible to speculate,” Osborne said.
Beshear’s budget notably did not fully fund the estimated $121 million school safety bill that passed out of the legislature last year, instead only dedicating $18 million to make school buildings safer.
Other parts of the school safety bill include requiring mental health counselor for every 250 students and requiring every school have a law enforcement officer.
“To choose to ignore the mental health side of this is woefully short,” Osborne said.
Beshear’s budget would provide for a 1% increase to higher education funding, which has been cut every year for more than a decade. It also provides a 1% increase to SEEK, the K-12 funding formula, and restores funding for textbooks, which was cut under former Gov. Matt Bevin’s administration.
Beshear says the initiatives in his budget would be funded by $148 million in new tax revenue gained by legalizing sports betting, increasing taxes on tobacco products and other revenue raising measures, like an increase to the licensing fee for limited liability companies.
The plan also calls for transferring about $288 million in excess revenue from other accounts — a tactic used by previous administrations, including former Gov. Matt Bevin’s — and gleaning $206 million by “maximizing resources” through lawsuit settlements, retiring debts and collecting more taxes.
Senate President Stivers said he was concerned that Beshear’s plan used one-time revenue to fund recurring expenses.
“Basing this budget and future budgets on that and saying we’re going to have non-recurring revenues to have recurring expenses is a flawed economic policy,” Stivers said.
The House of Representatives will now write their own version of the two-year state budget. If that passes, it will be sent to the Senate. The two chambers will then hammer out a final version of the budget to send to the governor, who has the power to veto part or all of the budget.
But the legislature can easily override any of Beshear’s veto with a simple majority vote in each chamber.
Here are some of Beshear’s other budget initiatives:
- $189 million for $2,000 per year raises for public school teachers
- $87.5 million for a SEEK K-12 funding increase
- $18.2 million for school safety building upgrades
- $237.9 million increase to fund Medicaid/Medicaid expansion
- $35 million in bond funding for U of L’s Jewish Hospital purchase
- $37.5 million for 350 new social workers (a 27% increase)
- $32 million for 1% salary increase for state employees
- $52.5 million for phase two of state police radio system replacement
- $109 million for corrections over biennium increase
- $16.4 million to match $93.9 million in federal water and sewer infrastructure improvements
- $30.4 million for REAL ID rollout