Kentucky lawmakers extend budget deadline

Kentucky lawmakers spent Monday deciding to not convene Tuesday.

Prodded by Gov. Matt Bevin to resolve an impasse over the state budget, House and Senate leaders agreed to postpone the final day of the legislative session from Tuesday to Friday. That gives them a little more breathing room to continue negotiating a two-year, $21 billion spending plan for the state after previous talks broke down late Sunday night.

“We’ll get back to work on this thing,” House Speaker Greg Stumbo, D-Prestonsburg, told reporters. “It’s a step in the right direction.”

A budget deal must be completed by Wednesday evening for the bill to be printed in time for House and Senate floor votes on Friday, Stumbo said.

Overall, the budget is expected to cut most of state government by 9 percent, with some exceptions, such as K-12 schools and Medicaid. Bevin wants to plow the savings into the state’s two pension funds for state workers and school teachers, which together face a $36 billion funding shortfall. The House and Senate disagree over how much extra money to put into pensions, and how much to provide for reserve funds Bevin requested.

The previous obstacle in budget talks was cuts to higher education. But Bevin, the Senate and the House all seem ready to accept 4.5 percent cuts in state appropriations to colleges and universities over the next two years, said Senate President Robert Stivers, R-Manchester. That is more than House Democrats wanted and less then Senate Republicans and the GOP governor recommended.

Stumbo and Stivers say they continue to disagree on other items, such as millions of dollars in coal severance projects; the House’s “Work Ready” tuition aid program at community colleges; and the Senate’s performance-based funding formula for higher education.

Tuesday was originally set to be the final day of the 2016 legislative session. However, if lawmakers adjourn without approving a budget, they either must come back for a $62,000-a-day special session or else Bevin is severely restricted in how he can spend state funds, limited to essential items listed in the state constitution.

Senate leaders were preparing to gavel in Tuesday, finish their other business and adjourn without a budget. But Bevin released a videotaped statement Monday urging lawmakers to postpone the session’s final day and give negotiations another chance.

“A lot of great work has gone into discussing this budget. There is no reason for us not to go until the last day possible to ensure that we finish this process,” Bevin said. “So I’m asking them, go until Friday, get the job done while we are in town.”

The constitution requires lawmakers to end their annual law-making session by midnight Friday.

At a news conference Monday, Stivers said the Senate and House still disagree on how to spend the coal severance tax money raised from coal mined in Eastern and Western Kentucky. The House proposed ending the traditional 50/50 split between the state’s General Fund and the coal-producing counties so the counties would get all of the money. In response, the Senate criticized the lengthy list of local projects the House recommended using coal-severance funds.

Stivers, who represents coal counties in Southeastern Kentucky, has complained that coal-severance money is squandered on “frivolous projects,” such as golf courses and swimming pools, that did not prepare the region for a post-coal economy, as it originally was intended. Senators have called for the money instead to be invested in an economic development fund tied to the Shaping Our Appalachian Region initiative.

“It should be for creating jobs and opportunity,” Stivers said. “And if you look at the list, you see what the House proposes to do with $44 million. And we have a different way that we believe would actually benefit the region in the long term and be more advantageous to creating jobs and opportunities. Because if we don’t, we’re going to continue to see that out-migration (of people) that we have seen over the past few years.”

This story was originally published April 11, 2016 at 4:49 PM with the headline "Kentucky lawmakers extend budget deadline."