Before a joint session of the House and Senate Tuesday evening, Governor Steve Beshear outlined one of the toughest state budgets in recent history, proposing 8.4 percent spending cuts for many agencies and limited money for new construction projects. Beshear called the two-year, $19.5 billion General Fund budget "inadequate for the needs of our people." Beshear, who has cut the budget 10 times since taking office in December 2007, warned that Kentucky has cut past the bone. To generate more revenue, Beshear said it is time to add casino gambling at the state's horse racetracks and consider tax reform. Beshear said, if Kentucky does not get new revenue soon, it can not invest in key areas such as education and infrastructure.There is $3.5 million in Beshear's budget for an initial study of the renovation of Rupp Arena and $41.5 million to fund the completion of Newtown Pike extension and $16 million for the opening of the new Eastern State Hospital.
The budget does not call for any layoffs of state workers, but Beshear cautioned that some state agencies may have to trim staff to achieve the $286 million of cuts in the budget, which takes effect July 1st. The legislative and judicial branches of state government also will face an 8.4 percent cut in their operating budgets, but the judicial branch will get some increases in its funding for projects, including an overhaul of its computer system.
Several key programs would be exempt from the 8.4 percent cuts, while others will receive smaller cuts.
Exempted programs include: Medicaid, the main funding formula for K-12 schools, preschool, veteran's affairs, child and adult protection, mental health, prisons, probation and parole, public defenders, student financial aid, mine permitting and reclamation and the Kentucky Horse Park.
Programs that would receive smaller cuts include: universities and community colleges, 6.4 percent; aging and independent living, 6.4 percent; grants to local school districts, 4.5 percent; career and technical education, KET, libraries and archives and vocational rehabilitation programs, 4.2 percent; mine safety, 4.2 percent; Kentucky State Police, commonwealth and county attorneys, juvenile justice and local jail support, 2.2 percent; and property valuation administrators, 2.2 percent.
Beshear proposed $815 million in new spending, including:
■ $372 million for existing debt obligations and $19 million for new debt payments
■ $79 million for retirement contributions for state workers
■ $88 million for increased health insurance costs for state workers and retired teachers
■ $84 million for Medicaid;
■ $21 million to add more than 100 social workers and support staff in an effort to reduce case loads of front-line social workers;
■ $16 million to operate the new Eastern State Hospital;
■ $14 million for parole and pretrial officers
■ $15 million to expand preschool to an additional 4,430 Kentucky children.
■ $2 million to fund an adult abuse registry of workers who have had substantiated cases of abuse or neglect
■ $4 million to expand the KASPER program, the state's prescription drug-tracking program
