Budget impasse stretches into Tuesday

03/28/2016 11:46 PM

FRANKFORT — Lawmakers trying to negotiate a $21 billion biennial budget hit a roadblock on Monday, with Democrats hoping to restore proposed cuts in education spending while Republicans want those dollars to instead shore up the state’s beleaguered pension systems.

Senate President Robert Stivers, R-Manchester, said legislators may soon pass the point of passing a two-year spending plan with enough time to override any line-item vetoes by Gov. Matt Bevin while House Speaker Greg Stumbo, D-Prestonsburg, suggested that leaders could amend the calendar and vote on a final version of House Bill 303 by Friday if they want to preserve their veto-override authority.

This year’s General Assembly is set to adjourn sine die April 12, with the veto break currently scheduled to begin Wednesday. The legislature must have a budget passed by April 15 under the Kentucky Constitution.

“This is something we agreed on: We can work and continue to work during the veto-override period and try to get a budget,” Stivers said after the budget conference committee adjourned Monday evening.

“We still have, I believe this is the 28th day of the month, so we have two more days left in the month, so we have 14 days to continue to work on Saturdays and weekends to get to a point where we can deliver a budget to the governor on the 12th … just not veto-proof.”

Both sides seemed entrenched in what they’ve set as their respective spending priorities.

Democrats are holding firm on restoring proposed education cuts and Republicans are digging their heels on a $250 million fund, first suggested by Bevin in his budget at $500 million, that would help the state meet future pension obligations.

Stumbo has taken to calling the proposal a “slush fund,” saying he’s seen nothing drafted during budget talks that would set out exactly how those dollars would be spent.

“It’s just a matter of whether you buy into this idea that as far as I know no other state’s really done, is you give the governor a $250 million slush fund that there’s no guarantee it’s going to be use for anything related to pensions, and that seems to be a hangup with them,” Stumbo told reporters.

“We’re willing to negotiate. We’re willing to stay here as long as they want to stay here, but we just don’t believe if you have the money that you should shortchange education, and we have the money.”

Bevin’s budget would add $39 million to SEEK, the funding formula for K-12 public schools, while cutting other areas of education and postsecondary education by 4.5 percent in the current fiscal year and 9 percent over the biennium.

The House restored those spending cuts, but the Senate reversed course for the most part, not addressing the current year spending reductions in its version of HB 303.

“We just don’t think that’s the direction we need to be going when you’re sitting on a $38 billion unfunded liability in the pension system,” Stivers said of the House’s requests for new education appropriations in amounts ranging from $300 million to $400 million during negotiations.

All sides tried to lay blame for the negotiations’ stalemate at another’s feet.

Stumbo said he noticed a change in budget talks after Bevin met with the Senate GOP caucus on Monday.

“I think probably the more the governor meets with the Senate the farther apart we get, if that tells you anything,” he said.

But Bevin countered that Stumbo is the main reason that discussions on the two-year spending plan have stalled, and Stivers again bemoaned the timing of the House vote on HB 303.

“Only one party to this entire thing has made insinuation that a budget is not likely to be reached, and that’s him,” the first-year governor said.

“Everybody from the Republican side — the Senate, the House, from my office — have been very clear. It’s our intention to come out with a budget that, frankly, is fair, that’s equitable, that speaks to what we were sent here to do, and frankly it is the responsibility of all of us involved to come out with one.”

The budget conference committee is set to reconvene talks at 10 a.m. Tuesday in the Capitol Annex.


Subscribe to email updates.

Subscribe and get the latest political intelligence delivered to your inbox.