Gov. Beshear calls for gaming to help ease budget woes

FRANKFORT, Ky. (AP) - Gov. Steve Beshear urged lawmakers on
Tuesday to legalize slot machines at Kentucky horse tracks as a way
to stave off massive budget cuts and potential layoffs of state
Lawmakers could generate $780 million for state government over
two years by allowing the tracks to install video slot machines,
Beshear told reporters before addressing a joint session of the
House and Senate on Tuesday evening.
The proposal has proven divisive in the past in Kentucky, a
state where political leaders historically have frowned on
casino-style gambling despite a long history of wagering on horse
races, lotteries and charitable games like bingo.
Though the proposal appears to face long odds, Beshear contends
it is a sensible means of resolving the state's financial woes and
he challenged lawmakers to approve it.
"It requires some courage," Beshear said. "I'm hopeful they
will demonstrate that courage."
Beshear said his budget proposal includes no tax increases for
fear they could push Kentucky's economy further into recession.
Without the revenue from slots, Beshear said state government
would face cuts of more than 12 percent over the first year of the
two-year budget proposal and 34 percent in the second year. That's
in addition to 20 percent to 25 percent cuts already made in many
state agencies.
"Cuts of this magnitude would undoubtedly lead to mass layoffs
and would inflict devastating damage on literally hundreds of
critical services to communities and individuals around the
commonwealth," Beshear said.
Under the governor's budget proposal, gambling revenues would
help the maintain current funding levels for job creation, health
care, public safety and education programs.
The governor also said he remains hopeful that Congress might
approve a second round of funding to help states like Kentucky
balance their budgets. If that happens, Beshear said 1 percent pay
raises to teachers and state employees would be among his plans for
the money.
"We cannot control what happens in Washington, and thus my
budget does not count on that money," he said.
Among spending initiatives included in the voluminous budget
bill, Beshear proposed $1.5 billion in general fund bonds for
construction projects that he said will create jobs for
Kentuckians. He also proposed $300 million for additional highway
construction projects and $129 million in general fund bonds to
construct a new Eastern State Hospital for the mentally ill to
replace the existing facility that predates the Civil War.
Besides gambling revenues, Beshear also proposed a variety of
maneuvers, including fund transfers, debt restructuring and
spending cuts to balance the budget. House Appropriations and
Revenue Committee Chairman Rick Rand, D-Bedford, said he intends to
file the governor's budget bill Wednesday.
House Speaker Greg Stumbo, D-Prestonsburg, said he will propose
an alternative budget if Beshear is unable to win the support of
enough lawmakers to pass his own.
"It will be a test of his leadership skills and his legislative
skills," Stumbo said.
Senate President David Williams, R-Burkesville, predicted that
the gambling proposal would doom Beshear's budget proposal.
"Ultimately, you cannot spend, tax or gamble your way to
prosperity," Williams said.
Beshear called his budget proposal a conservative and
responsible way to help state government weather the economic
"Now what is needed is honest, thoughtful and open discussion
of how to move forward," he said.
Antigambling advocates objected to Beshear's contention that
gambling is a sensible option.
"Private companies and private individuals are cutting back,
and there's no reason that government can't do the same thing,"
said Martin Cothran, spokesman for Say No To Casinos.
Cothran said he doesn't believe Beshear's proposal has enough
support to pass the House or the Senate. But, if it did, Cothran
said he expects a lawsuit to challenge the constitutionality of the
Say No To Casinos contends that the state constitution
specifically forbids gambling. Beshear and other proponents
"The leaders of both chambers of the General Assembly have
advised the governor not to do this," Cothran said. "He should
listen to good advice."
A measure similar to Beshear's gambling proposal passed the
House last year but died in the Senate.
Beshear said his latest proposal has one notable variation from
last year's legislation: He is calling for the money to go into the
general fund to balance the budget - not primarily to education
programs as before.

(Copyright 2010 by The Associated Press. All Rights Reserved.)

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