Senate passes its version of budget

The Kentucky Senate has passed its version of a two-year state spending plan, in what amounts to another step in the process to get a new state budget.

The latest version contains no new taxes.

“It reflects our priorities by committing to not raising taxes on hardworking Kentuckians for errors of omission or commission from previous generations of politicians,” said Senate Appropriations and Revenue Chair Christian McDaniel, R-Taylor Mill. “We placed high priority, and honored the requirement of the constitution, to present a balanced budget.”

In a release, Sen. McDaniel talked about the budget reflecting lawmakers' commitment to education. He says the bill calls for a record amount of per-pupil funding for schools, known as Support Education Excellence in Kentucky (SEEK), and funding school transportation at historic records.

Lawmakers say the budget proposal calls for performance-based funding for the state’s eight public universities.

“We also maintain our focus on solving the thorniest issue facing the commonwealth, which is the unfunded liabilities in our pension systems by investing record dollars into the Kentucky Retirement Systems, while fully funding the statutory requirement to the Kentucky Teachers’ Retirement System,” McDaniel said.

He added that the Senate’s version of the budget does not continue to fund the legislators’ own retirement plan. That money is instead budgeted for the Kentucky Employee Retirement System non-hazardous plan, which McDaniel said was the worst-funded pension in the nation.

For the teachers’ retirement system, the Senate plan provided the 13 percent statutory required funding. While the Senate plan doesn’t contain $59.5 million for retired teachers’ health care, it would use a nearly $1 billion trust fund to pay for the insurance.

McDaniel said the bill would also ensure the retirees’ premiums wouldn’t go up just because of that funding change.

The governor’s proposed budget recommended reductions of 6.25 percent in the upcoming biennium in most budget areas. McDaniel said the Senate’s version of the budget generally applied the cut to the executive branch except for veterans’ affairs and state police.

The Republican-led chamber voted 26-11 after a long debate Tuesday to pass its spending proposal.

That sets up the next phase of the budget debate when conferees from the House and Senate will work in the coming days to iron out differences between the chambers' spending plans.

“Yes, to many this is a hard-candy Christmas,” said Sen. Tom Buford, R-Nicholasville in reference to the lean budget. “There comes a time when you have resources that are tight. We have a lot of issues here we have to deal with that are not normally on the table.”

Sen. Buford then warned of the chaos of not passing a budget.

“I can tell you that’s very unpleasant,” Buford said. “The schools don’t get their money. No one gets their money. You kind of leave it on the governor’s table to make these necessary government expenditures, and it is not fun.”

Also approved today were the amended legislative budget (House Bill 204) and judicial budget (House Bill 203), which where were passed by Senate votes 36-2 and 26-12 respectively. McDaniel said both HB 204 and HB 203 budgets contain 6.25 percent cuts for all non-constitutional functions.

All three bills now go back the House for consideration of the Senate changes.