KY House approves $12 billion state budget bill as it speeds on its way to negotiations
The Kentucky House sent a $12 billion state budget bill to the Senate on Monday as Republican legislative leaders said their spending plans likely will be more conservative than Democratic Gov. Andy Beshear’s.
Last Thursday, Beshear proposed a Fiscal Year 2022 budget that would include a small boost in education spending, money for school construction and pay raises for teachers and other public employees. Beshear said his plan relies on $613 million in one-time funds but no tax increases or spending cuts.
However, what the House approved Monday was a one-year continuation plan that essentially mirrors the current state budget, with necessary adjustments for things like debt service, said the House budget committee chairman, Rep. Jason Petrie, R-Elkton.
The simplified bill is simply a procedural maneuver to let lawmakers speed the budget bill into a conference committee with the Senate, where a final version can be hammered out later in the legislative session, Petrie said. Given the short deadline imposed by the 30-workday session, time is of the essence, he said.
Republicans hold super-majorities in both chambers of the General Assembly, giving them the freedom to use as much or as little of Beshear’s new budget plan as they like.
In a series of speeches on the House floor, members of the Democratic minority said they hope GOP leaders ultimately will incorporate much of Beshear’s budget plan. They praised the governor for proposing more state funding for schools, universities and local health departments and expanded broadband service.
“We have a lot of people who need our help,” said state Rep. Angie Hatton, D-Whitesburg.
But Petrie, echoing other GOP legislative leaders, said he has some concerns with the budget plan that Beshear put together. Beshear relied on an economic forecast that seems unrealistically optimistic given the COVID-19 pandemic and an economy that continues to struggle, Petrie said.
Last year’s tax collections in Kentucky were better than expected in part because billions of dollars in federal relief flowed through the state, including federal supplements to jobless benefits, Petrie said. In such an environment, it’s difficult to predict what this year will bring, he said.
“We have to understand that the ground that we stand on may appear firm at times, but when you look underneath the top thin layer, there may be further considerations that require prudent, careful analysis of where we are before we spend one-time money that’s available,” Petrie said.
“One-time money, historically in Kentucky, that I’ve observed, results in ribbons being cut and fanfare being given, but little to no consideration of how those buildings are ribbons and fanfare are dealt with in subsequent budgets for maintenance and upgrades, regardless of what the project or purpose may be,” he said.
Earlier in the day, Petrie postponed a scheduled House budget committee vote on a separate $340 million COVID-19 relief package that Beshear requested, saying he wanted more information about it.
Beshear’s relief bill would offer direct aid to small businesses and nonprofits, and it would repay a portion of Kentucky’s loan from the federal government for its unemployment insurance program.
Congress recently passed a $900 billion coronavirus relief bill that will funnel more money into Kentucky, following on last spring’s federal CARES Act, Petrie noted.
“Not sure at this point, nor has anybody been able to show me, what money is coming from the federal government in the last relief bill that passed,” Petrie said. “I don’t want to end up committing money and staking taxpayer money in the budget to something that we could either leverage or avoid because of the federal money coming down and we can use our own money somewhere else.”
“Now, that one should be fairly easy to take care of as long as federal guidance and strings and restrictions are disclosed quickly and clearly,” he said.
Ordinarily, the legislature would have passed a two-year state budget in 2020, making it unnecessary to deal with the budget this year. However, as the coronavirus pandemic struck Kentucky last March, lawmakers swiftly enacted what was essentially a one-year continuation spending plan and then cut short their session.
Last week, GOP legislative leaders said they will try to find some common ground with Beshear. But they said they were uncomfortable with his reliance on one-time funds, and they feared that pay raises for public employees might be difficult to approve with tens of thousands of Kentuckians made jobless during the COVID-19 pandemic.
This story was originally published January 11, 2021 at 12:44 PM.
