Surplus of $40.5 million won't be treated like extra money, governor says

07/15/2013 12:41 PM

While the state government ended the fiscal year last month up $40.5 million, Gov. Steve Beshear said it’s not exactly extra cash.

Beshear told Pure Politics that the surplus might not be as big as hoped because of other necessary expenses that weren’t budgeted for, such as paying for natural disaster recovery.

“We also have expenditures that we’re just now tallying up. We’re not going to be running out, and trying to find new ways to spend that money. We already have necessary government expense that we’ve incurred from the different disasters that we deal with,” Beshear said.

Extra money not soaked up by disaster relief will go into the rainy day fund. That means even programs the governor announced he’d cut this spring won’t suddenly see a windfall — like stipends for low income families to pay for daycare. Those cuts will continue as planned until the legislature reconvenes in January.

To fill the funding gaps with the child care system Beshear has pledged to make further tax changes his top priority during the 2014 session.

Pure Politics has interviewed half a dozen lawmakers in recent weeks who each expressed an openness to revamping the state’s tax code so revenue will grow with the economy and keep up with mounting expenses for education, health care and other programs. But they’ve also said the governor must take the lead on a tax reform proposal. And they’ve said that should include a public tour to drum up support.

Beshear told Pure Politics on Friday that he’s still in the early phases of gauging support with legislative leaders about what’s politically possible before he launches a tax modernization tour.

The news marked the third straight year of growth for the Commonwealth following two years of decline, which was attributed to the national recession.


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