Frankfort, KY – Financially, it's been a rough two years for the Beshear administration, which has already overseen more than $800 million in state spending cuts and is preparing for more. But Gov. Beshear still believes substantial progress has been made despite the bad economy.
"We have balanced this budget five times in 24 months, each time with bipartisan support," said Beshear. "We have passed a complete revision of our economic incentives programs, which puts Kentucky on the cutting edge in terms of competing for jobs."
Beshear says the administration has also reduced the size of government, overseen pension reform, won approval of a funding mechanism for major bridge projects and avoided scandal.
"Right after I became governor, I instituted one of the toughest executive branch ethics codes in the country and we've been living by that ethics code," said Beshear. "We cleaned up the Transportation Cabinet, which had been mired in scandal and corruption for many years."
And while he's had no choice but to cut millions of dollars from state spending, Beshear says the administration has done everything possible to protect money for Medicaid, public safety and basic school funding.
"We have no new money, and you can't have money to put in any new programs," said Beshear. "But what we have done is - unlike other states - while we've cut money out of our budget, some $800 million, we have not cut a dime out of the SEEK formula, which is the basic funding formula for classroom teaching in K-12 in our state."
But with the state still facing a $161 million shortfall in the current fiscal year, and additional deficits expected next biennium, Beshear warns more cuts are coming. Does that mean layoffs?
"Certainly I hope we don't have layoffs," said Beshear. "But that's an issue that is too speculative right now to really address one way or the other."
One thing Beshear says he won't support is tax hikes.
"I think raising taxes in a broad way on people and businesses right now would have just the opposite effect," said Beshear. "I think it would push this state much further into recession instead of helping us come out of it. So, for me that is not an option."
Gov. Beshear still sees casino-style gambling as a potential source of new revenue for the state and will continue to push for video slots at horse tracks. The governor says it's a better option than a constitutional amendment on expanded gambling.
"Passing the video lottery terminal legislation can be done immediately," said Beshear. "It can be put in effect immediately. If we have a lawsuit, we can get it over in six months. It can be implemented a lot faster than any constitutional amendment."
The governor's had some setbacks in his efforts to recruit new industry to the state, including last week's announcement that Harley-Davidson won't be moving its York, Pennsylvania, motorcycle assembly plant to Shelbyville. But Beshear believes it's just a matter of time before the state lands a big one.
"We're not afraid of losing, because if you're not in the game, you can't win," said Beshear. "So, we'll keep going at it. We're gonna keep having our successes - and we've had many of them - and sooner or later, we'll hit some big name success that will attract everybody's attention."
Beshear admits it has been a tough two years, especially coping with the Great Recession, but says he and First Lady Jane Beshear are enjoying the challenge and truly believe they're in a position to make a difference.
"And we look forward to bringing this state out of this recession and getting people back to work and really permanently improving the quality of life of everybody," said Beshear.
Gov. Beshear is already running for re-election in 2011. His running mate is Louisville Mayor Jerry Abramson.