State budget crisis may go on

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By Todd Martin

Gov. Steve Beshear hasn’t set a date for House and Senate members to return for a special session to finish the state’s budget for 2010-2012, and it doesn’t appear he will anytime soon.

It’s unlikely that Beshear will announce a date before an agreement has been made, to avoid wasting taxpayers’ money.

The Legislative Research Commission estimates that it costs a little more than $63,000 per day for a special session. It takes at least five days for a bill to make it through the legislative process, meaning at a minimum this special session could cost the state more than $315,000.

“This sure doesn’t help our budget any,” Sen. Gary Tapp (R-Shelbyville) said. “This is something that should have been done on the 15th. But we [the senate] felt that the state, and the taxpayers, couldn’t afford to go into any more debt.”

The sticking point between the House and the Senate is mainly behind the $300 million in revenue the House came up with in a suspension of businesses' ability to carry forward losses.

That revenue allowed the house to propose $1 billion in bonds for use on schools and other projects. The Senate rejected the revenue plan on businesses and most of the spending for schools and other projects.

“The Senate made concessions for the category five schools, the ones with the most need,” said Rep. Brad Montell (R-Shelbyville), who voted against the House plan. “And the House agreed to cut back on the project list, but there was no middle ground.”

Now the state faces possible shutdown of several different facets of government, possibly as early as July 1.

“The only thing the Governor can fund without a budget is essential items,” Montell said. “A lot of things would be forced to shut down if we don’t come up with a budget.”

Gov. Beshear has said that if an agreement is not reached by June 1, his office would need at least one month to make plans to shut down other areas of government on July 1.

Tapp said the June 1 deadline also could save the commonwealth millions, if bonds can be refinanced. That, however, is contingent on a budget being passed.

Without a budget for the next fiscal year, the bonds could not be taken to the bond market.

The Kentucky Supreme Court has ruled that the governor cannot run the state without a budget.

Although a list of what state services would be shut down has not been made available, leaders have said that continued funding of schools, prisons, state police and Medicaid would be allowed.

The state has run for as long as a year without a budget, but since that Supreme Court ruling, that is no longer an option.

Only essential functions covered by the state constitution can continue to operate, along with some some services required by law or by the federal government.

Both Montell and Tapp are hopeful an agreement can be made.

“I hope we can come together – I don’t know how optimistic that sounds,” Tapp said. “But there’s no guarantee that we’ll get a budget done.

"The House just has a different philosophy than we do – you can’t spend what you don’t have.”

With the May primary looming just less than a month away, many lawmakers could be facing an uphill battle.

“I know no one will cherish having to come up here a week before the primary,” Montell said. “People are upset, and I don’t blame them. It’s going to be very tough for people in the primary.”

Montell is running unopposed in this year’s election, and Tapp is retiring at the end of the year.