FRANKFORT — State agencies have been asked to prepare worst-case-scenario budgets for the current fiscal year in order to close a projected $456 million General Fund shortfall.
Gov. Steve Beshear has asked lawmakers to solve the shortfall with a combination of cuts, furloughs and a 70-cent-per-pack cigarette tax increase, but lawmakers remain reluctant to raise taxes.
House and Senate leaders now want to know how state agencies would absorb the entire $456 million shortfall if the state had no new revenue, Beshear said Monday.
By law, the state has to balance its budget. When the state's revenues do not meet projections, the legislature must either cut funding or find additional money through taxes or fees. Lawmakers return to Frankfort next week to tackle the issue.
"We are working with the legislature on looking at different scenarios to solve this budget crisis," Beshear said, stressing that no decision has been made.
Education Department spokeswoman Lisa Gross said Monday afternoon that the new reductions could translate to a 6.7 percent cut for her agency.
"Right now, we're just trying to pull together some input from school superintendents and go back and look at the information we've gathered already," Gross said.
Beshear proposed a 4 percent reduction in most state agency budgets in December, but recommended sparing the main funding formula for local school districts and cutting 2 percent from other education programs.
Acting State Budget Director John Hicks said state agencies are expected to turn in their revised budget plans by Tuesday.
Hicks stressed that the revised budget cuts are only one scenario that the legislature has asked to see.
"It will be reviewed by the governor, the House and the Senate," Hicks said.
He said there was no set percentage that state agencies were told to cut. Medicaid, which already has a ballooning shortfall, was the one area exempt from additional cuts, Hicks said.
The cuts have already hampered some state agencies and have resulted in some lawsuits.
Monday, several juvenile justice employees filed grievances against the state because they have been told that they must pay for their own uniforms because of state budget cuts.
Many state workers are already struggling, said officials with the American Federation of State, County and Municipal Employees, which represents juvenile justice employees.
Ben Burris, a juvenile justice employee in Columbia, said the state can't cut any more from its already depleted budget. Burris is one of the juvenile justice workers who filed a grievance with the state. The additional charge for uniforms will affect 1,300 employees.
"Some employees have gotten second jobs due to our low pay and now we're facing the furloughs and the uniform costs," Burris said in a release. "When is enough going to be enough?"
For local school superintendents, it's too early to say how deeper cuts, especially to the main funding formula, called Support Education Excellence in Kentucky, would change what goes on in the classroom.
"It's difficult for me to definitively say how any of these state budget scenarios would play out in Fayette County, because there are still so many unknowns," said Stu Silberman, Fayette County Schools superintendent. "Based on the current information we have from the Kentucky Department of Education, we might be looking at a $5 million to $6 million adjustment to this year's budget.
"We would likely cover that out of our contingency fund, but eventually, if mandated expenses continue to go up, revenues continue to go down, and these cuts continue to hit local school districts, the impact is going to be on our kids."