Gov. Beshear highlights coal counties, rural roads and overflowing jails in first budget address

Gov. Andy Beshear summarized his first budget to lawmakers Jan. 28, 2020, outlining how he plans to fund programs and prioritize dollars. His budget includes relief for coal counties, investment in rural roads and finding solutions to high incarceration rates in Kentucky jails.

Beshear said his budget is based on his core values including:

• funding and supporting public education
• access to health care
• fully funded public pension obligations
• appreciation for and reinvestment in public employees
• support for quasi-governmental agencies like child advocacy centers and rape crisis centers
• directing more funding to struggling communities, including coal counties
• support for law enforcement and firefighters

His speech focused heavily on the importance of education, with a reference to his earlier mentions of a proposal of a $2,000 raise for all Kentucky public school teachers.

“The most important profession, the most important title in Kentucky is ‘teacher,’ and it is time we invest in them,” Beshear said.

Other education-focused initiatives include increased teacher pay and incentives, funding for the full actuarial health insurance contribution for retired teachers, investments in preschool, K-12 and postsecondary funding, and scholarships for 60,000 students from lottery revenues.

Beshear highlighted initiatives to help victimized or struggling families, including pension relief to child advocacy centers, rape crisis centers, mental health and public health departments.

He then turned his focus to struggling rural communities.

“Our coal counties in Kentucky have been hit hard. They need help,” Beshear said.

He then pledged to coal counties, after paying the required debt service on water and sewer infrastructure, and the state’s administrative costs, to return all remaining coal severance dollars back to coal counties. Over the two-year budget period, this should provide approximately $18 million in funding.

“At a time when basic services are at risk, we should help these counties provide for their people,” Beshear said.

Funding for transportation was another key priority of the night, with the governor saying transportation is critical for the safety of families and the future of businesses.

Beshear put a particular focus on rural roads.

“Using a combination of state and federal funds, my administration will put $100 million to improving our rural road conditions,” he said.

Finally, Beshear emphasized the need to address rising corrections costs and incarceration rates, saying that the state’s biggest challenge is corrections. He noted that since 2004, the state’s incarcerated population has increased more than 40 percent, pointing out that this level of growth is not sustainable.

“In the last biennium, we spent $1.2 billion on corrections,” Beshear said. “The estimated cost increase in this budget is $109 million above and beyond that $1.2 billion. Folks, we must address this problem.”

Beshear urged the legislature to find ways to generate more revenue without raising taxes on working families. He proposed four revenue measures: sports betting, a cigarette tax hike, a new tax on vaping, and an increase in the minimum of the limited liability entity tax.

The governor closed with a call for collaboration to solve the many issues facing Kentucky.

“I said two weeks ago in my State of the Commonwealth address that we have an opportunity. An opportunity to stop the yelling and the name-calling,” Beshear said. “Kentuckians deserve better than the bitterness that defines our politics, and they deserve a budget that stops cutting and starts rebuilding. I know we can do that. Let’s get it done.”

The House will now take ownership of all the budget bills filed last night and develop their own priorities before sending it to the Senate for their consideration and modification. Then, both chambers will meet to craft a final agreed-upon budget to send to the governor’s desk.

You can access the 2020-2022 Executive Budget Recommendations HERE.

Deeper Dive: Impact on Counties and Elected County Officials

Gov. Beshear’s Executive Budget in Brief highlights a number of areas that could impact counties:

• Improved Compensation for Law Enforcement and Firefighters - Local and state law enforcement officers and local firefighters will receive a $600 stipend increase from the Kentucky Law Enforcement and Firefighters Foundation Program funds, bringing the stipend up to $4,600. Over 8,000 law enforcement officers and over 3,800 firefighters will receive this increase.
• Supporting our State Prosecutors - The budget provides an additional $3 million each year for more staffing for the Commonwealth’s Attorneys and $840,000 each year to support the operating expenses of the County Attorneys.
• Corrections - To offset the loss of 1,269 prison beds, most at the medium-security Kentucky State Reformatory, the Commonwealth will begin operating a new medium-security correctional facility in Wheelwright, the Southeastern Correctional Complex, which provides 656 beds.
• Returning Coal Severance Tax Revenues to Counties – The budget returns coal severance tax revenues to the counties after reserving amounts needed for debt service on past capital projects that benefited Kentucky’s coal counties and the administration of those programs. Over $10.3 million in fiscal year 2021 and $7.5 million in fiscal year 2022 will be returned to the counties through the Local Government Economic Assistance Fund.
• Water and Sewer Infrastructure - The capital budget includes $16.4 million in state bond funds to match $93.9 million in federal dollars to repair, replace and improve local drinking water and wastewater infrastructure.
• State Share of County Elections and Voter Registration - The Governor’s budget includes a return to the statutory rate of state reimbursement to counties for election and voter registration costs.
• Equal Pay Audits - The Department of Local Government will administer a grant program that provides resources for local governments to voluntarily conduct equal pay for equal work pay audits of their own human resources processes; $1,000,000 in each year of the biennium.
• REAL ID - The Executive Budget includes $4,124,800 in the current year and over $15 million each year of the biennium so that the Transportation Cabinet can begin issuing REAL ID motor vehicle driver licensing and personal identification cards, complying with federal security requirements and meeting the October 1, 2020 deadline for air travel and entering a federal building. The Judicial branch’s Circuit Court Clerks will not be issuing REAL ID’s.