Senate passes their version of biennium budget which differs from House plan

03/20/2018 03:56 PM

FRANKFORT – The Kentucky State Senate passed their budget proposal which includes a number of changes from the House version.

House Bill 200 passed by a 26-11 vote on Tuesday night.

The Senate proposal reinstates most of the 6.25 percent across the board budget cuts to the Executive Branch that Gov. Matt Bevin had proposed for most areas except for Veteran’s Affairs and the Kentucky State Police. The Judicial and Legislative branches were treated similarly in their respective budgets, heard earlier on Tuesday.

The debt service ratio in the Governor’s proposal was 5.53 percent. The House proposal was 5.70 percent, while the Senate proposal is at 5.41 percent.

The ending balance of the Budget Reserve Trust fund in the Senate proposal is $254.2 million, compared to $353.8 million in the Governor’s proposal and $249.7 million in House budget proposal.

The Senate version does not include the 50 cents per pack cigarette tax or the 25 cents per dose opiate tax, which the House had proposed.

Senate Budget Chair Chris McDaniel, R-Taylor Mill, highlighted what the thinking was in crafting the Senate biennium budget proposal.

“The principle that we started with was that we will fully fund the commonwealth’s pension plan, and then from there, we honor our commitments to public safety, which includes foster and adoptive services, and then we honor our commitments to education,” McDaniel said. “So, what we didn’t do is invest in workforce development bond pools, we didn’t invest in asset preservation pools, we didn’t do a lot of new spending.”

In the area of education, SEEK funding would be increased to $3,984 per pupil in FY19 and $3,985 in FY20, which was less than the House proposal.

It also funds SEEK Transportation at the historic level of $214.7 million in each fiscal year.

In addition, it adds $8.5 million of Coal Severance Tax Revenues in FY19 for school districts that have lost $100,000 or more in Calendar Year 2018 due to a reduction in the assessed value of their unmined minerals.

As for postsecondary education, it reinstates Bevin’s 6.25 percent cut to the state’s colleges and universities, but does allocate $5.1 million to NKU and $3.2 million per fiscal year for equity.

McDaniel says a lot of that money can be recovered by the universities through outcome based funding.

“We had a commitment to outcome based funding, we had a formula provided by the university presidents for outcome based funding, so, at the top we did leave that six and a quarter percent, but we mainly re-spent that money in higher education,” McDaniel said.

Additional financial support of $1,370,500 in FY19 and $1,020,100 in FY20 has been allocated to support the Kentucky Educational Excellence Scholarship (KEES) Program at the statutorily required amount.

Additional money was allocated for a number of the state’s pension systems with the exception of the legislature’s pensions which would receive no additional funding.

“The state police retirement system is currently 26.44 percent funded and we added another 100 million dollars in general fund support in each fiscal year to be applied to the unfunded pension liability to the state police retirement system,” McDaniel said.

Kentucky State Police lab personnel, who are some of the lowest paid in the country, would be seeing salary increases with the Senate proposal which is putting in $1 million each year for salaries.

In the area of public health, the Senate proposal adds $500,000 each fiscal year for the Kentucky Colon Cancer Screening Program, $2.5 million in General Fund support in each fiscal year for the Kentucky Pediatric Cancer Research Trust Fund, and increases General Fund support by $1,523,000 in FY19 and $1,342,100 in FY20 for smoking cessation.

Community Based Services would receive additional financial support with $11.1 million for social worker salary increases.

Kentucky Education Association President Stephanie Winkler was in attendance at the meeting and expressed her concerns about the Senate proposal as it relates to education.

“I heard reduction in family resource centers which provide huge amounts of background services for our students,” Winkler said. I heard things about 365 health insurance, I don’t know how much of that is sweeping or if there’s any sweeping going on, but I am still concerned that that’s an issue that you might not be taking from general funds, and so if those come from other funds like our Teacher Retirement Health Insurance Trust, I think that’s an issue.”

House Bill 366, the revenue bill, passed by a 23-15 vote.

One of the highlights of that bill would allow local law enforcement agencies rehire retired police personnel as school resource officers without having to pay for their retirement and health insurance. It would also let state troopers to work as school resource officers.

House Bill 203, the Judicial Branch budget passed by a 26-12 vote, and House Bill 204,a bill making appropriations for the operations, maintenance, and support of the Legislative Branch, passed by a 36-2 vote.

The budget bills will go back to the House where they will likely go to a conference committee with the goal of having a final budget proposal passed by both chambers before the veto period.


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