Fri January 3, 2014
Kentucky's State Budget Outlook Worst in Recent Memory, Report Says
A survey of Kentucky's economy says lawmakers have a choice between reinvesting in services or making more cuts to government.
The report says $250 million in additional revenue won’t be enough to meet the state’s most pressing needs. The report was released Thursday by the Kentucky Center for Economic Policy.
Director Jason Bailey says this is the worst outlook in recent memory, and lawmakers must find ways to increase revenues to reverse the negative effects of budget cuts.
“The economy is still growing too slowly to generate adequate revenues," Bailey says. "We have a tax system that’s outdated and badly in need of reform. At the same time, there are serious pressures to roll back budget cuts to pay for the liabilities to build up the pensions and other areas.”
The total state budget is about $18 billion.
The cost of funding the state’s most pressing priorities could add up to an additional billion dollars, the report says.
The alternative, Bailey says, is to continue to fall behind other states that have made those investments. He advocates comprehensive tax reform as a major step in lifting Kentucky out of its economic funk.
“Lawmakers face a very stark choice, you know, between reinvesting in our future, putting us on sounder footing for our economy, for our communities and our quality of life; or retrenching further with more budget cuts, more underfunding of areas that would make Kentucky a stronger state," Bailey says.
You can read the full report here.