Lawmakers take first steps in negotiating state budget bill

bmusgrave@herald-leader.comMarch 26, 2012 

FRANKFORT — House and Senate leaders have agreed to cut a $30,000 annual living expense for Lt. Gov. Jerry Abramson.

That was one of few noteworthy agreements between the Republican Senate and the Democratic House on the first full day of negotiations over a two-year, $19 billion budget. House and Senate leaders met three times Monday to work out differences between the two budgets.

Senate Budget Committee Chairman Robert Leeper, I-Paducah, said early Monday that there are few major differences between the House and Senate budgets. Once some global decisions are made — particularly involving debt — there will be few decisions left to make, he said.

Abramson lives in Louisville and drives to Frankfort each day. He does not need a housing allowance, legislators said. The living expense was deleted in the Senate budget. Senators said that Senate President David Williams, R-Burkesville, said the previous lieutenant governor, Dan Mongiardo, was from Perry County and needed the housing allowance.

The House agreed to the change early Monday.

Kerri Richardson, a spokeswoman for Gov. Steve Beshear and Abramson, declined to comment on the House and Senate decision.

Here are some other key differences between the House and Senate budgets:

■ The Senate version does not authorize a $3.5 million state bond for the downtown Lexington redevelopment project around Lexington Center and Rupp Arena.

■ The Senate version eliminates an additional $3.5 million appropriation to the Kentucky Horse Park.

■ The House version includes millions of dollars in coal severance projects — projects paid for by taxes from coal — that are not included in the Senate budget.

■ The Senate version does not include the Kentucky Appalachian College Completion Program, a proposed college scholarship for kids in Eastern Kentucky that would be financed by coal severance taxes.

The House authorized $552 million in borrowing, and the Senate authorized $391 million. The Senate also booked savings throughout its budget by lowering the projected interest rates of bonds, which are at historic lows.

The Senate version asks the governor to cut nearly $100 million in contracts over the two years.

The coal severance projects and the issues surrounding debt were not resolved Monday. Williams said Senate Republicans decided not to give the additional $3.5 million to the Kentucky Horse Park because they thought the park, which is a state park, was not being managed properly if it was running a deficit of $3.6 million.

Rep. Bob Damron, D-Nicholasville, said the park ran into trouble because of the 2010 World Equestrian Games. The park built additional facilities and then had to shut the park during the games, resulting in a loss of revenue.

Damron also questioned why the Senate cut the $3.5 million loan to the park but gave the Kentucky Fair Board $5.5 million, when it typically receives no state money. Williams said the Kentucky Fair Board was in financial straits because the legislature approved the building of the KFC Yum Center, which is draining money from the Fair Board's coffers.

Speaker Pro Tem Larry Clark, D-Louisville, said the House thought it should give the Kentucky Horse Park the $3.5 million for this fiscal year and then demand a business plan.

The House and Senate did not come to an agreement Monday on the issue.

The House and the Senate passed their versions of the budget earlier this month. The budgets include an 8.4 percent cut to many state agencies and do not cut the main funding formula for schools.

The two sides need to reach an agreement by 3 a.m. Thursday for a budget bill to be printed and ready for a vote by both chambers Friday. Budget negotiations are set to resume at 10 a.m. Tuesday.

Beth Musgrave: (502) 875-3793. Twitter: @BGPolitics. Blog:

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