Senate Likely To Make Further Cuts To State Budget

Mar 9, 2012

FRANKFORT, Ky.   The Senate is likely to make additional spending cuts to Kentucky's budget to reduce the amount of debt that's proposed to keep state government running, a key lawmaker said Friday.

Sen. Tom Buford, R-Nicholasville, said his GOP colleagues are bent on capping the debt level at 6 percent.

"We took a vote here not to exceed 6 percent," said Buford, a member of the Senate Appropriations and Revenue Committee. "So we're not going to exceed 6 percent debt. That is how we're approaching the budget. So we're still looking for cuts."

The state's debt would be 6.8 percent of revenues under a plan approved by the House earlier this week. That's down from 7.1 percent in the governor's original proposal, but not enough to appease Senate Republicans.

The Republican-controlled Senate, scrambling to complete budget work with only 16 working days remaining in the legislative session, would have to impose additional spending cuts to reduce the debt load.

"I don't think you can go wrong at this moment, with the public opinion, by holding the line on debt," Buford said.

Senate Appropriations and Revenue Committee Chairman Bob Leeper, I-Paducah, said members have begun digging into the austere $19.5 billion state budget proposal that calls for 8.4-percent spending cuts in most government agencies.

Some 200,000 state and local government retirees would feel the state's financial pinch under the House proposal that eliminates 1.5 percent cost-of-living increases from their monthly pension payments.

Gov. Steve Beshear had declared "the day of reckoning has come" when he presented his budget proposal to lawmakers in January. Few government services were spared under his plan to close a $742 million shortfall. He included the sale of bonds as a means of generating needed revenue.

The House whittled Beshear's proposal for some $950 million in new debt down to $350 million. House lawmakers also removed from Beshear's budget proposal several construction projects at the state's public universities that would have been paid for with the sale of bonds.

Some House Democrats complained that the proposed budget already cuts too deeply into government services.

But, with a pervasive anti-tax sentiment in Frankfort, the only hope of more revenue is economic growth, which is occurring slowly across Kentucky. The state reported a major economic milestone on Thursday when the state's unemployment rate fell below 9 percent for the first time in three years.