Governor Matt Bevin unveiled his two-year budget during an address Tuesday evening. It’s a lean budget, recommending 6.25 percent cuts over the next two years for most state spending and eliminating 70 programs mostly involving education, outreach and arts initiatives. This, the governor says, is necessary to allow the state to set aside more money than ever before for Kentucky’s ailing pension systems.
But that additional pension funding comes at a cost to many state agencies and programs.
This year’s budget marks the first time ever in Kentucky where the GOP controls both chambers of the General Assembly, as well as the Governor’s mansion during a budget-writing session. But Bevin’s budget is still just a proposal; an initial missive that will require approval and undergo revisions by both the state House and Senate.
Administration officials say the state would save about $85 million a year by eliminating the 70 programs on Bevin’s list. Scroll to the bottom for a look at those 70 programs; but first, here’s a look at what some of those programs do, as well as a few larger areas that will be affected if Bevin’s proposal goes through as is:
The Kentucky Center — Proposal Eliminates State Funding
According to the Kentucky Center’s upcoming 2017 annual report, “nearly 55 percent of the organization’s budget comes from earned revenue” — things like ticket sales, facility rentals, garage operations, concessions and program revenue. The remaining 45 percent is made up of individual and corporate memberships, sponsorships, foundations and public funding.
And state funding is part of that pie. The Kentucky Center currently gets $325,000 annually, and Governor Matt Bevin’s budget proposal removes all of that funding.
A follow-up statement by the Kentucky Center said:
“We understand that Governor Bevin had difficult decisions to make and that his proposed budget focuses on a few key areas, including fully-funding pensions, and essential health and safety services.”
Although the proposal cuts the Kentucky Center’s funding, the organization said it was pleased the budget continues to fund the Governor’s School for the Arts at the same as level as the revised fiscal year 2018 appropriation. The Kentucky Center could also be indirectly harmed by proposed cuts to the Teacher Academies Program within the Kentucky Department of Education’s Learning and Results Services.
“The Center received $88,000 from the Department of Education this year to conduct statewide Arts Academies for teachers,” the statement read. “These cuts will impact our non-profit mission and our service to the Commonwealth.”
Kentucky Mesonet — Proposal Eliminates State Funding
The Kentucky Mesonet is a weather and climate monitoring network operated out of Western Kentucky University. It works with the National Weather Service to prepare daily weather forecasts, as well as severe and winter weather warnings.
Director Stuart Foster said the Mesonet provides some essential public safety functions, in terms of providing timely, accurate alerts for events like flash floods or severe weather. But besides that, he said the Mesonet monitors variables other than temperature and precipitation, and plays a significant role in the state’s agricultural sector, too.
One new program he’s currently working on involves Kentucky soybeans, and the very specific meteorological conditions under which Dicamba herbicide can be safely applied.
“So, the Mesonet will be providing key data to help farmers know when they can apply that chemical to their fields,” Foster said.
The Mesonet also tracks longer term data, like on climate change in Kentucky. Governor Matt Bevin has publicly expressed doubts about the role humans play in climate change; Foster said despite the politicized nature of the conversation around climate change, he doesn’t believe that’s hurt his ability to make a case for the Mesonet among diverse groups of people in the state.
“Aside from any issues about climate change, just the ability to monitor and better understand the variability of our climate and the extremes that we can experience in terms of heat and cold and flooding and drought and so forth, helps us to better manage those conditions when they happen,” he said. “And when we better manage in the context of extreme conditions, it helps to make Kentucky more competitive economically because we aren’t impacted as negatively from these type of events.”
Kentucky Mesonet received $750,000 in the Fiscal Year 2016 and 2017 budgets. Foster estimated that state money makes up about 75 percent of the Mesonet’s funding, and losing it would “raise questions” about the future direction of the program.
Kentucky Film Incentive Program — Proposal Closes To New Applicants
In his written briefing, Bevin announced his budget would close the film incentive program to new applicants.
The film incentive program was created in 2009 under Gov. Steve Beshear. The legislature in 2015 dramatically increased the value of the subsidy to 35 percent of costs, without a cap. A huge uptick in new movie projects followed, and by October, the state had promised more than $148 million in incentives.
More than half of that money was approved in 2017 alone. A story from the Kentucky Center for Investigative Reporting last year found that last year, as the applications rose astronomically, the Kentucky Tourism Development Finance Authority began to hold its discussions about the projects in secret.
They also never rejected an application.
The finance authority was scheduled to hold a meeting last week, and it had nine new film projects on the agenda. But the meeting was cancelled, for lack of a quorum.
In an emailed statement, Garry Gupton, spokesman for the Tourism, Arts and Heritage Cabinet, said the cabinet’s secretary recommended ending the program. The money saved would be reallocated to the general fund, Gupton said.
“In light of Kentucky’s current fiscal condition, we can no longer justify the potential expenditures of the film incentive program,” Gupton said.
— Kate Howard
Access to Justice — Proposal Eliminates State Funding
Governor Bevin’s proposal also curtails state money from Kentucky’s Access to Justice Commission.
The commission helps low-income Kentuckians pay for civil legal aid, supporting legal services’ costs and recruiting legal professionals to volunteer. The cut surprised KACJ Executive Director Glenda Harrison, who said the cuts would make it harder to serve people in need.
“When you say to people, ‘I’m sorry. Because you’re poor, you can’t get a divorce from your abusive husband,’ that sends a message that some people aren’t valued,” Harrison said. “The agencies aren’t going to go away … but their capacity to deliver civil legal services to people will be substantially and adversely impacted. And it shouldn’t happen.”
Harrison said the program’s services have helped 60,000 people and their communities. According to the program’s website, more than half the people who qualify are already turned away because resources are lacking.
Bevin discussed his proposal to defund programs in a radio interview with WVHU Wednesday, saying it would help fund the ailing pension system.
“In my budget I cut 70 government programs, in their entirety, out of funding — zero funding provided for them. Because this is what happens when you don’t pay your [pension] bills for 20 years and then start,” Bevin said. “That doesn’t make them bad programs … but if we had more means they wouldn’t be cut to this degree — if at all.”
KACJ plans to network with legal services programs and others to communicate the program’s importance. The budget must be approved by both Kentucky’s General Assembly and Bevin before it’s ratified.
— Kyeland Jackson
State Police — Proposal Increases State Funding
Though Governor Bevin’s proposed budget slashes funds for many state agencies, it benefits Kentucky’s State Police and Department of Corrections.
The budget would increase KSP’s budget to $265 million by 2020 – a $37.9 million increase from this year. Some of the money would fund new vehicles and weaponry for state troopers, which Bevin called “extremely outdated” in a radio interview with WVHU Wednesday morning.
“We also have folks understaffed on that front, and those are not good combinations,” Bevin said in the interview. “It’s for the safety of those individuals themselves, but also for those of us that they’re there to protect and serve.”
Bevin’s budget also gives police more money for training. The proposal adds nearly $15 million to the Department of Criminal Justice Training budget; this department is tasked with training officers, coroners and other criminal justice workers in the state.
Sometimes, Louisville Metro Police Department officers are among those trainees. LMPD spokeswoman Jessie Halladay said the department views additional training for officers and workers as a boon for all law enforcement agencies.
“We are very supportive of all efforts to make sure that every officer in this state, in this commonwealth, has the resources and training that they need,” Halladay said. “I think that sends a positive message to law enforcement that the governor is behind them.”
Department of Corrections — Proposal Increases State Funding
The Kentucky State Police’s increase pales in comparison to the boost Bevin’s budget gives to the Department of Corrections.
The DOC will see a $117 million budget increase by 2020. The largest piece of that – $37.9 million – will fund a return to private prisons in Kentucky.
The state abandoned private prison use in 2013 after a riot and allegations of overcrowding, mismanagement and sexual misconduct, but reopened a contract with a private prison company in 2017. Currently, the commonwealth has has 12 correctional facilities for adult felon offenders and projects nearly 2,000 more prisoners will enter their facilities by 2020. The DOC’s proposed budget also pays for excess costs through state funds.
That support won’t extend to local jails, who would receive a $1.4 million decrease by 2020. Part of that cut includes dissolving the Jailer’s Allowance Program, which trained local jail workers.
— Kyeland Jackson
K-12 Education — Proposal Includes Cuts To Support Programs
Bevin’s budget bill keeps per-pupil funding for Kentucky’s public education students at $3,981 per student, but chips away at support programs and requires local school districts to pay a larger share of student transportation costs.
Administration officials say budget pressures created by the pension crisis has made it “harder to protect” public education from cuts.
Among the 70 programs cut in Bevin’s budget are several within the Kentucky Department of Education’s bureau of Learning and Results Services, which provides grants for afterschool programs, preschool and textbooks.
Overall, the Kentucky Department of Education’s budget is cut by around $200 million each year under Bevin’s plan.
During his address on Tuesday, Bevin said local districts would be required to chip in for health insurance using local savings, which he said add up to $950 million across the state.
“We’re going to ask these districts to tap these funds,” Bevin said.
The state would only pay for 25 percent of transportation costs like school buses under Bevin’s plan, compared to 58 percent under the current scheme.
Local school districts would be ordered to cut administrative expenses by 12 percent each year under the proposed budget. Districts that have administrative costs that are less than 15 percent of instructional costs would be exempt from the cuts.
State Worker Pensions — Proposal Increases Funding
Bevin’s bill would set aside more money than ever before for the ailing pension systems — about 15 percent of the state’s two-year budget.
Kentucky Retirement Systems — the pension fund for most state workers — would receive $1.1 billion and Kentucky Teacher Retirement Systems (KTRS) would receive $2.3 billion out of the state’s $22 billion biennial budget.
But administration officials say the amount set aside for the KTRS could increase dramatically if the legislature approves a central tenet of Bevin’s proposal to overhaul the pension systems — shifting from a “percent of payroll” method of paying pension liabilities to a “level dollar” funding method.
“Level dollar” means that the state contributes a fixed amount every year while the “percent of payroll” method relies on increasing employment or salaries in state government over a long period of time.
The KRS board has already shifted its assumption that payroll will grow by 4 percent each year to 0 percent, creating a de facto “level dollar” situation.
Administration officials said they are still in favor of paying off the state’s pension obligations using a level dollar method and that enacting it this year would require additional hundreds of millions of dollars from the state budget.
Higher Education — Proposal Cuts Programs
Gov. Matt Bevin recommends the elimination of 70 statewide programs, which involves cuts to higher education programs overseen by the Council on Postsecondary Education.
The Council’s role in the Commonwealth includes licensing institutions and monitoring tuition rates. CPE also has a strategic agenda, which entails raising the percentage of Kentuckians with a certificate or postsecondary degree to 60 percent by the year 2030.
But programs within the CPE that Bevin proposes zeroing out include Professional Education Preparation, Minority Student College Preparation and the Autism Training Center.
“Our state has really high goals in terms of higher education achievement,” said Ashley Spalding, senior policy analyst at the Kentucky Center for Economic Policy. “And so CPE in addition to doing so much work with higher ed, they also provide adult education.”
That includes administering the GED. “We have a lot of Kentuckians who don’t have a high school degree or GED credential,” Spalding said. “If we want to reach our higher ed goals, we’re going to need to have more Kentuckians become more and more educated.”
The Governor also proposes gutting the Robinson Scholars program at the University of Kentucky. The program offers scholarships and other services to first-generation college students from Eastern Kentucky.
“This budget actually does put a little bit more money in needs-based financial aid,” Spalding says. “But at the same time that it does that, it does cut some important scholarship programs. Eliminating these scholarships is just another way that we’re disinvesting in higher education.”
Other education programs the governor is proposing to eliminate at the University of Kentucky include the University Press, the Center for Entrepreneurship and Mining Engineering Scholarships.