KY House releases budget plan a week ahead of Governor Beshear’s

The Kentucky House of Representatives

The Kentucky House of Representatives

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Kentucky House Republicans on Friday tabled a two-year budget bill that includes long-sought pay raises for state employees, sufficient public funding to cover the cost of full-day kindergarten for school districts and the more than $4.2 billion required for pension contributions to funds for state workers and teachers.

By introducing House Bill 1 on the fourth day of the 2022 legislative session, the House GOP majority unexpectedly jumped on Democratic Gov. Andy Beshear, who is not expected to present his own spending plan. state to lawmakers ahead of his official budget speech next Thursday. .

House Speaker David Osborne, R-Prospect, said his goal was to get the House to pass a budget quickly so it could then tackle the complicated issue of changes to the tax code, which could adjust the amount of revenue that the State receives in the years to come. Some Republican lawmakers want to switch from income tax to sales tax.

The governor’s office did not seem to appreciate the House standing in line.

“Today’s actions are concerning because they violate both longstanding practice and state law. Neither the executive branch nor the governor was alerted or consulted,” the gate said on Friday. -word by Beshear, Crystal Staley.

“Most concerning is that the House budget is failing to make the game-changing investments that Kentuckians will see in the governor’s recommended budget,” Staley said. “For example, the governor’s budget will fund universal pre-K for all 4-year-olds.”

House Republican leaders announced their budget bill in an unexpected press release after adjourning for the day on Friday. They then posted the 213-page bill online for public review.

Based on the bill’s aggregate numbers, the House appears to be taking a conservative approach in some respects.

Last month, state economists estimated that Kentucky could raise enough revenue for a general fund of $14 billion in fiscal year 2023 and a general fund of $14.6 billion in fiscal year 2023. fiscal year 2024, with several billion more available in excess state revenue and federal aid following a COVID-19 pandemic stimulus package and an infrastructure bill.

However, the press release says the House budget plan would rely on a smaller general fund of $13.9 billion each year, with “a continuing commitment” to saving money available in the House Trust Fund. state “rainy day” budget reserve.

Federal money provided for pandemic response and transportation infrastructure would be targeted to those specific spending needs, House leaders said.

“For too long, the Kentucky state government has viewed the budget as an opportunity to win votes and curry favor. That hasn’t been our approach and that’s certainly not the case with this budget,” said Rep. Brandon Reed, R-Hodgenville, HB 1 sponsor and deputy chairman of the House Budget Committee.

Brandon Reed.jpg
Kentucky Representative Brandon Reed, R-Hodgenville Kentucky Legislative Research Commission

“While some would ask that we use one-time federal funds to make recurring commitments, we would pay long after federal funding ends to pay for them,” Reed said. “We are committed to continuing our efforts to provide clean water, internet access and meet our pension obligations,” Reed added. “These are fundamental and fundamental concerns.”

An analysis of the House budget bill by the Kentucky Center for Economic Policy in Berea suggested that GOP leaders left several billion dollars in funds “on the table unspent.” If all that money goes into the state’s rainy day fund, it would be 28% of the general fund, the center said.

“That’s way more money than the state needs to prepare for the next recession, and putting too much aside will make our recovery from the pandemic weaker than it can and should. ‘be,’ the center said.

Among the specific items identified in the House budget would be money for:

Wage increases for the state government workforce, which is struggling with poor morale and understaffing in many different agencies.

There would be raises and annual retention payments of $4,800 for social workers totaling $25.6 million in the first year and $61.7 million in the second; a $15,000 increase for Kentucky State Police troopers and motor vehicle inspectors; an $8,000 increase for state police telecommunications personnel; and more than $7 million per year to increase the salaries of public defenders, which currently start at $45,000 per year.

For the rest of the state workforce, there would be a 6% increase in fiscal year 2023. No increase is identified for next year, but the personnel secretary of the The state would be responsible for releasing a report to lawmakers on the salary structure for different job classifications. .

One hundred additional social worker positions each year of the budget, for a total of 200. There would also be funding to provide an undetermined number of “additional staff” to the Attorney General’s office and to local offices of Commonwealth and Crown Attorneys. county.

An increase in guaranteed per-student SEEK funding for school districts to “an all-time high,” from $4,000 this year to $4,100 in fiscal year 2023 and $4,200 in fiscal year 2024.

However, in its analysis of the House budget, the Kentucky Center for Economic Policy said those numbers aren’t as generous as they appear. SEEK’s core funding is a mix of state and school district money, the center said, and in the House bill, the state’s allocation would increase from $2.081 billion to the this fiscal year to $2.044 billion over the next two fiscal years.

Twice as much state funding for full-day kindergarten in both fiscal years to cover full costs for school districts. Full-day kindergarten was one of the priorities of a school funding task force that met throughout the legislative interim last year.

An increase in state funding for school district student transportation costs from the current $214 million to $274 million. While this would bring more money to the districts, it does not match the total transportation funding the state once provided.

More than $2 billion in actuarial contributions required for the Kentucky Teachers’ Retirement System, which provides pensions to educators. In addition, the state would pay $479 million to settle outstanding obligations the teachers’ pension system owes retiring educators for sick leave and cost-of-living adjustments.

The $1.2 billion a year in required actuarial contributions for the state’s main workers’ pension fund at the Kentucky Public Pensions Authority. This fund has only 18% of the assets it needs to meet future liabilities, making it one of the weakest public pension funds in the country. There would be $215 million more to pay off worsening unfunded liabilities for the Kentucky State Police’s separate pension fund, also managed by the KPPA.

A new $10 million annual grant pool to the Department of Local Government to enable each State Representative and State Senator to allocate public funds to local governments, educational units and quasi-governmental agencies at their discretion.

The money would be divided by population, so each senator should have about $130,000 to spend and each representative should receive about $50,000. While lawmakers can already include expenses in their home districts’ budgets, if they have the clout, this fund would allow them all to hand out checks throughout the year.

Water and wastewater projects in every county that would be paid for with $350 million in US federal Rescue Plan Act funds. Additionally, an additional $312 million in ARPA money would go to the state unemployment insurance fund to bring it back to pre-pandemic funding levels.

Just under $13 million a year to increase the state’s daily payment to local jails for each state prisoner they hold, bringing it to $35.34. To avoid building more jails, the Kentucky Department of Corrections has long relied on local jails — even those that are dangerously overcrowded — to house thousands of state inmates serving felony sentences.

$372 million this fiscal year and the next two fiscal years to increase state reimbursement to nursing homes, using state and federal funds. The nursing home industry says it has been struggling financially since the COVID-19 pandemic began in March 2020.

This story was originally published January 7, 2022 4:03 p.m.

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John Cheves is a government accountability reporter at the Lexington Herald-Leader. He joined the newspaper in 1997 and previously worked in its Washington and Frankfurt bureaus and covered courthouse beat.
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