Facing an “extremely tight” upcoming biennial budget, Gov. Steve Beshear said Tuesday he is “determined” to restore funding for K-12 education, even if that means cuts to other agencies and programs.
Beshear, who listed Kentucky’s jump in educational rankings as one of his top achievements this year, has managed to stave off major cuts in education spending during his administration, though per-pupil funding has dropped at Kentucky’s public schools since the recession.
Education Commissioner Terry Holliday has said hundreds of public school teachers face layoffs without additional funding.
“I am determined to reinvest in education with this upcoming budget, and so if I have to cut some other areas to do it, then that’s what I’m going to do,” Beshear said in a year-end interview with reporters.
“… These great educational attainments that I just pointed to this last year are a result of their (educators’) efforts in spite of some very difficult financial circumstances, but we are approaching a point, I’m afraid, where if we can’t begin to reinvest and start building back some of the things that have been lost in funding for education, then we’re going to lose this momentum that we have.”
How deep those proposed cuts would be remains to be seen. Beshear was noncommittal on specifics, saying his administration is crafting its budget proposal to present to lawmakers. The draft budget won’t include possible revenues from expanded gaming — a tactic he tried unsuccessfully in 2010 — or tax reform, he said.
That doesn’t mean those issues are dead, however. Beshear said he expects to talk “some specifics in tax reform as well as expanded gaming” in the upcoming session.
“What our success may be, I don’t know,” he said. “Obviously both of these issues are difficult in any session. They will probably be more difficult this session because it’s an election year … but it is time to discuss both of these in detail, and hopefully we can get the Legislature to address both of them.”
Trying to open Kentucky’s borders to casino gambling has been a hallmark of Beshear’s time in office, something he acknowledged to reporters Tuesday.
While success on that issue has evaded him, Beshear said he sees “encouraging signs” that expanded gaming could become a reality. He said House Speaker Pro Tem Larry Clark, D-Louisville, has advocated for expanded gambling and Senate Majority Caucus Chair Dan Seum, R-Louisville, has signaled a willingness to carry the issue in his chamber.
Beshear said he believes those involved in gambling discussions agree that, “a clean, simple constitutional amendment is the route that we should go from that standpoint.” There’s room to negotiate on enabling legislation, he said.
“I don’t harbor false hopes, but I’m encouraged that for the first time, we’re getting some very meaningful conversations from both sides of the aisles in both houses,” Beshear said. “I’m hoping that we can continue to develop that and find some common ground to move forward.”
Beshear said his budget proposal would include full actuarially required contributions to the Kentucky Retirement Systems, which is expected to cost the state an extra $100 million annually. The state will be paying full contributions for the first time since 2002 as part of pension reform legislation passed this year. KRS’ pension fund for most state workers is one of the country’s worst funded with enough assets to cover only 23.2 percent of its retirement obligations.
But KRS won’t be the only pension system on Beshear’s radar.
Gary Harbin, executive secretary of the Kentucky Teachers’ Retirement System, has said he will request $1 billion in pension obligation bonds to maintain the plan’s financial stability. KTRS’ unfunded liabilities could nearly double from $12 billion to $23 billion without a funding plan expected to cost $400 million more annually due to accounting rules that take effect in 2015, he said.
“It’s obviously an issue that at some point will need to be addressed in some way,” Beshear said of KTRS. “Whether we can address it during this next biennium, we’ll have to see.”
A proposed natural gas liquids pipeline that would run through Franklin County has also raised issues lawmakers will sort through during the session.
Legislators have pre-filed bills regarding the use of eminent domain by companies building such pipelines, as Bluegrass Pipeline officials have said they’ll use as a last resort. A group of residents filed a complaint in Franklin Circuit Court this month seeking clarification on the company’s proposed use of eminent domain.
Beshear said he would review pre-filed legislation on eminent domain and creating a regulatory board before the session.
“I haven’t made a final determination on where I’ll go with that, but I’m paying close attention to the issue,” he said.
Beshear’s other legislative priorities include expanding dating violence protection, implementing a statewide public smoking ban and improving the state’s child booster seat laws, he said.