WKYT - Frankfort - Headlines

State selling commonwealth owned properties to generate revenue

FRANKFORT, Ky. (AP) - As Kentucky's state government faces a mammoth revenue shortfall, Gov. Steve Beshear is doing what lots of families do when income falls short of obligations: Find the stuff they aren't using and put it up for sale.

State-owned planes, vehicles and other property will be sold to generate money for Kentucky's shrinking budget, Beshear said Wednesday.

The move is the result of an economic recession that has hit the state's general fund hard, leading to a projected $1.5 billion shortfall over the next two-year budget cycle. That's on top of $1 billion that has been cut from the current budget.

Beshear said he doesn't know how much money the property sales will raise, but he said it should "soften the blow of budget cuts" that could include employee layoffs.

"The scope of what we're tackling suggests that the benefits could be substantial," he said told reporters in a Capitol press conference.

Beshear said he is proposing the sale of all land, buildings and equipment that isn't essential. Under the initiative, the administration will re-evaluate rental property agreements and renegotiate state contracts for goods and services.

"As a result of this initiative, we will be left with a stronger, leaner, more muscular, more sustainable, reinvented government, so that when the economy does turn around we will have even more money for priorities like education, health care, public safety and economic opportunity."

Beshear said at least two of the state's 15 airplanes could be put on the auction block. He had no estimate on how many of the state's more than 4,000 vehicles might be sold.

Already, the Beshear administration has been selling surplus property to generate money for the general fund. He said the state sold a parking garage in Covington in December, generating $1.5 million.

Beshear also said Wednesday that he and key members of his administration this year will continue taking the 10 percent salary reductions that they took in 2009.

"This announcement reflects our desire to let the people of this commonwealth and our employees throughout state government know that we're all in this together," Beshear said. "Together, we will make sacrifices, and together, we will survive."

Lt. Gov. Daniel Mongiardo and all the governor's cabinet secretaries will take the salary cut.

"Families all across this state are suffering," Mongiardo said. "They're losing their homes. They're losing their jobs. They're losing their health insurance. These are tough, tough economic times, unlike anything we've seen in our lifetime."

Beshear has told lawmakers that he opposes broad-based tax increases to generate more revenue, saying he fears that could drive the state further into recession. He said Wednesday he still is open to the possibility of expanded gambling as a means to generate $200 million to $300 million a year in new revenue.

However, Beshear said he still hasn't decided whether he will make gambling part of his legislative agenda in the current session of the legislature. The issue has been divisive among Kentucky lawmakers. Such a proposal failed last year in the state legislature.


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