Attorney General Beshear questions legality of $350M in budget cuts proposed by Gov. Bevin

09/12/2017 02:03 PM

FRANKFORT – A request by Gov. Matt Bevin’s administration for budget cuts totaling $350 million in many state government agencies may be illegal and lead to another courtroom showdown between Bevin and Attorney General Andy Beshear.

Beshear announced Tuesday that he had outlined his legal concerns in a letter to Bevin’s office, which sent letters to agency leaders on Friday asking for their plans to absorb 17.4 percent spending reductions by Sept. 25. Funding for K-12 education, Medicaid, corrections, universities and debt payments would not be impacted under the proposal.

Bevin’s recommended budget cuts pose “serious and significant legal problems,” Beshear said, adding that his comments during Tuesday’s Capitol news conference weren’t intended “to attack anyone or to continue any perceived feud.”

In his letter, State Budget Director John Chilton said $200 million from the savings would close an expected shortfall in this fiscal year’s budget while another $150 million would go into the state’s dwindling Budget Reserve Trust Fund.

But Beshear argued that the Consensus Forecasting Group’s pessimistic revenue estimate for the current fiscal year wouldn’t be finalized until December, that proposed cuts cannot exceed projected shortfalls, and that budget reductions couldn’t finance the state’s rainy day fund.

“The law on the rainy day fund allows funding from only two sources,” he said. “… Those sources are direct appropriation and a budget surplus. I think based on the letter that’s been sent we know that there’s not a budget surplus. They perceive a shortfall, and the appropriation can only be made by the General Assembly.”

The Republican governor and Democratic attorney general have clashed in courtrooms numerous times during their first terms in office, and Beshear says he “wouldn’t have any choice” but to pursue legal action if Bevin’s budget plan is implemented.

“It’s my hope because this is early that we won’t have to go to litigation at all, and all that’s required is for them to follow the law,” Beshear said.

“They can eventually make, under the budget reduction plan, reductions to state agencies after there’s an official shortfall projection, after they’ve taken the steps under the budget reduction plan and offset some of that amount, but you have to go through the steps that make it legal.”

Amanda Stamper, Bevin’s communications director, says Bevin is within his legal authority in requesting budget reduction plans from state agencies under his control.

She called Beshear’s talk of another lawsuit “entirely political” and “premature,” a word Beshear used to describe Bevin’s proposal to slash many agencies’ budgets by 17.4 percent.

“Kentucky families and businesses know they should not spend more than they make and having zero dollars in the bank to plan for emergencies is dangerous,” Stamper said in a statement. “Director Chilton’s letter merely asked state agencies to draft a similar spending plan before any final decisions are made later in the year.

“Kentucky law clearly allows the Governor to ask any agency to reduce its spending, and the Kentucky Supreme Court said just last year that the Governor can direct spending reductions for agencies under his control. Thus, AG Beshear’s grandstanding is not only fiscally irresponsible and nonsensical, but it is also contrary to the law.”

Senate President Robert Stivers, R-Manchester, could not immediately be reached for comment while a spokeswoman for House Speaker Jeff Hoover, R-Jamestown, said he was in court and had not reviewed Beshear’s comments. Beshear sent copies of Tuesday’s letter to both of their offices.

In his letter, Beshear asked Bevin’s office to reconsider its plan and write follow-up letters to affected agencies by this Friday.

Beshear’s letter can be downloaded here: Beshear Budget Reduction Letter.pdf


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