Lawyers for Gov. Bevin, AG Beshear agree to place $18M in separate fund as university cuts lawsuit moves ahead

04/21/2016 07:06 PM

FRANKFORT — Attorneys for Gov. Matt Bevin and Attorney General Andy Beshear agreed Thursday to set aside nearly $18 million that Bevin ordered cut from most university budgets until a lawsuit challenging that move is resolved.

Lawyers from both sides argued in an initial hearing before Franklin Circuit Judge Thomas Wingate, who said he would ultimately rule on the matter within 15 days after Beshear and Bevin have opportunities to make additional arguments.

Wingate — who disclosed that members of his family work in state government, including a merit job held by his wife in Beshear’s office — said he expected the case to ultimately wind up before the Kentucky Supreme Court.

At issue is the legality of Bevin’s mandated 2 percent cuts for all public colleges except Kentucky State University from their fourth-quarter budget allotments for the current fiscal year, which affected university presidents said in a letter they could handle “if it is determined by the courts to be permissible.”

In all, spending would be reduced $17.8 million under the order.

Steve Pitt, Bevin’s general counsel, relied on a pair of laws to support his position. One says the governor, chief justice or legislative leadership can revise, but not increase, budget allotments in their respective branches and the other indicates that the Finance and Administration Cabinet’s secretary can withhold allotments of General Fund appropriations if trusts or restricted funds are available.

Agency funds for affected institutions range from 44.8 percent of Morehead State University’s budget to 82.5 percent of the University of Kentucky’s budget, according to a sworn affidavit by Karen Marshall, a policy and budget analyst in the Office of the State Budget Director since 2002.

Marshall, in the affidavit filed Wednesday, agreed with the administration’s assessment of its budgetary authority, saying, “Simply because the General Assembly appropriates a certain amount of money to a particular budget unit does not mean that budget unit must spend all of the authorized amount.”

Pitt also pointed out that university presidents had not sued the administration for its action, saying the first-year Republican governor, university leaders and lawmakers had reached an agreement on budget reductions of 2 percent in the current year and 4.5 percent in the upcoming biennium.

But Beshear — a Democrat who took office about a month after Bevin succeeded his father, ex-Gov. Steve Beshear — argued that the governor can only reduce agency allotments during revenue shortfalls, which is laid out in state law and the current budget.

He added that Bevin relied on the current budget’s reduction plan when handling a shortfall in the Road Fund budget shortly after taking office.

“The Constitution itself, virtually every statute and every Supreme Court case on issue says the power of the purse, how to spend money, is solely a legislative function,” Beshear told reporters after the hearing. “The governor’s argument is, ‘The legislature just sets ceilings, and I decide whether to spend and how much to spend as long as it’s under that ceiling.’

“That is entirely unconstitutional. It violates our liberty. It would mean he could defund the state police just because he felt like it. It would mean that any governor could defund public schools. That’s the type of power that our Constitution prevents because it is a threat to our liberty.”

Pitt disputed that assessment, however, saying that neither Bevin nor any other governor would “cut any of these universities to the point where they can’t do what they’re established to do.”

If lawmakers have issues with Bevin’s current-year budget reductions to postsecondary institutions, they can amend state law, he said.

“It’s a legislative question,” Pitt said. “If a governor in any way oversteps their bounds, there is an answer to that. If it’s too far overstepped, it’s impeachment. If it’s otherwise, it’s at the ballot box.”

Wingate will also rule on whether three Democratic state representatives from Louisville — Reps. Mary Lou Marzian, Darryl Owens and Jim Wayne — can join the lawsuit, which Beshear filed April 11.


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