FRANKFORT – (KT) Gov. Andy Beshear delivered an unusual Budget and State of the Commonwealth address Thursday evening. While it took place before a joint session of the Kentucky House and Senate as is normal, he delivered it virtually, instead of in person.
Beshear began the remarks condemning both the invasion of the U.S. Capitol, which caused his address to be delayed from Wednesday, and the COVID-19 pandemic.
“In 2021, we will defeat the coronavirus, and we should be intentional about restoring our democracy. If we can accomplish both, 2021 will be a great year, but 2021 has the chance to be so much more,” he said.
He praised the actions of Kentuckians to keep the virus outbreak from being even worse.
“But you don’t have to take my word for it. You can look at the devastating experiences in states that failed to take the same aggressive actions we did to stop the coronavirus,” Beshear said. “Adjusted for population, we have suffered less than half the number of deaths as the people of Tennessee and less than one-fourth the number of deaths as the citizens of North and South Dakota.”
This despite seeing the highest and second-highest number of two cases on Wednesday and Thursday.
He then began an optimistic look ahead. “Kentucky’s ‘Rainy Day Fund’ is at its highest level ever, and in this budget we are going to provide an extra $100 million to further solidify and protect it,” Beshear said. “And I’m pleased to report that, with a better budget forecast than was initially anticipated, we have over $600 million in one-time money available to invest in our future.”
Even more importantly, according to the governor, “This budget, my Better Kentucky Budget, doesn’t rely on any increase in taxes; there are no spending cuts; and it doesn’t rely on the passage of any new revenue measures. So, with this budget, we have an unprecedented opportunity – an opportunity to provide real relief and jump ahead of other states.”
He said his “Better Kentucky Budget” is built on three pillars: relief for small business and Kentucky families; prioritizing people; and investment in the future.
“For small business relief, I am proposing $220 million be directed to the Better Kentucky Small Business Relief Fund, to help small businesses that have experienced losses as a result of this pandemic,” he said, which he wants lawmakers to pass in a separate bill with an emergency clause, soit would be available upon his signature, if passed.
“For individual relief, I am authorizing $48 million in CARES Act funding to go to those who have waited too long to receive unemployment benefits and help those who have missed out on the federal government’s Lost Wages Assistance Program because they made too little,” Beshear said. “It is the right thing to do.”
He also said he wants to fix the state’s unemployment insurance system. “My administration inherited a UI operation that runs on an IT system that is functionally obsolete. In the years leading up to the pandemic, the previous administration, and in previous sessions, closed in-person offices and cut 95 skilled employees from UI. The UI budget was further slashed by $16 million. This, coupled with a once-in-a-lifetime 1,300% year-over-year increase in claims, meant many Kentuckians have had to wait too long during a difficult time for their payments.”
He said he wants to use CARES Act funding to repay $152 million in UI loans and is asking lawmakers to provide $100 million more in this budget to go to those loans.
The second pillar prioritizes putting people first, prioritizing children and families’ education, health care and retirements.
“Kentucky’s great educators and school staff have had to overcome incredible challenges this year, quickly adjusting to online instruction when needed and making sure our children were fed even when they weren’t in the classroom,” he said. “That is why my budget calls for a $1,000 salary increase for every teacher, bus driver, cafeteria worker and other hardworking school employee in Kentucky. Let’s continue to invest in our children by increasing the SEEK formula and funding textbooks and electronic instruction resources. I am also providing support for preschool programs to help children most in need get started early on a path to success and opportunity. We are restoring a teacher loan forgiveness program and continuing to fund additional, full-time, school-based mental health services. “
Speaking of education, Beshear said his proposal provides more dollars to higher education, providing an additional $17 million for postsecondary institutions, a 2% increase.
“I am also creating the Better Kentucky Promise, a program that broadens the Work Ready Scholarship, creates new opportunities and provides the last dollar necessary for more than 6,300 Kentuckians to complete associate degrees or secure certificates,” he said. “I am also proposing a 1% raise for our hardworking state employees, who keep our communities running and have more than earned it.”
His plan also includes local and state law enforcement and firefighters, with a $600 stipend increase from the Law Enforcement and Firefighters Foundation Program funds.
The second pillar also includes an increase to local health departments, fully funding Medicaid and state retirement systems, and the Teachers Retirement System.
Some of the investments for the future, his third pillar, includes $100 million in additional one-time money to help rebuild and repair Kentucky’s schools. “This will improve the experience of students, educators and staff; it will enhance the surrounding communities,” Beshear said. “It will also create thousands of construction jobs and unleash a wave of positive economic activity across Kentucky.”
Since internet access is vital, he proposes $50 million to fund the last mile of broadband. “This is the first time that state dollars have been used to invest in expanding broadband. This historic investment will help make sure every family that needs it has it.”
Beshear also said the Transportation Cabinet budget needs an increase, which he is proposing. “Doing so will require both short-term and long-term solutions, but we need to invest in our transportation infrastructure now. This will create jobs and stimulate the economy immediately, even as it encourages future growth. I’m ready to step up to the plate. I hope others are too.”
He also says the state must continue to nurture innovation and entrepreneurship, and innovation begins with state government itself. “I’m asking all of my Cabinet secretaries to identify ways to modernize with an eye towards determining what services can remain remote. A resident of Paducah or Ashland who wants a license or certificate, shouldn’t have to spend more time in their car just coming to Frankfort than he or she does taking the test to get the certificate.”
Reacting to the speech, Senate President Robert Stivers, R-Manchester, urged caution in spending, despite more money being available. “These numbers have been artificially inflated by billions and billions of borrowed money at the federal level being infused into our state economy,” he said. “It’s because of all this borrowed money and the increasing national debt that the federal government is taking on to stabilize states.”
House Speaker David Osborne, R-Prospect, agreed. “While everyone acknowledges the state is in a better spot financially than anticipated, that doesn’t make me any less nervous about where we may end up. I think you’ll see us take a very conservative approach, and we’ll a very lean budget going forward.”
Still, Osborne says he believes they will find many areas of common ground with the Governor.
They added the House will likely pass basically a continuation budget, which the Senate will tweak. That will set the stage for the budget conference committee which is where the final budget will emerge.
(By Tom Latek, Kentucky Today)