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State budget will headline some recurring issues

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Hornback to push AT&T bill, Montell charter schools

By Lisa King

The 2014 Kentucky legislative session begins Tuesday, and although 137 bills already have been filed, some familiar story lines figure to be developed during this 60-day session.

In extended, even-numbered years, the longer session always seems to be headlined by the setting of the state budget, but state Sen. Paul Hornback (R-Shelbyville) said he foresees that there also will be time for those old familiars: gambling, health care, educational and state pension reform.

“When you talk about the budget, you talk about funding for education, and I think there’ll be a big push to put more funding into education,” he said. “Also, health-care reform – the Affordable Care Act. How we will handle that in upcoming years is going to be an issue, because right now, the federal government is picking up one-hundred percent of the cost, and we still have thirty-nine and half million dollars that we’ve already spent out of the state budget for that. So we’ve got to find out where that money is going to come from in future years.”

One area that Hornback said he plans to promote is something that he has championed in the past: broadband service.

“The one thing that I’m going to push that I did last session, that I want to get done this year, is the AT&T bill,” he said. “It would expand broadband coverage throughout all the state. That’s going to be my biggest issue – I think that would put Kentucky in a better position to attract business and industry.”

State Rep. Brad Montell (R-Shelbyville) said his focus would be on his continuing efforts to promote the establishment of charter schools.

“My big bill will be a charter school bill, one that I’ve worked on for several years,” he said. “It will be a pilot program to introduce charter schools to let people see how effective they are.”

Montell said his bill would allow only five charter schools to open per year within the first five years and would focus on at-risk children.

“When you think about charter schools, they’re not intended to replace our traditional school system as we know it but to fill in the gaps,” he said. “Right now, some of our biggest gaps are kids at risk, primarily minority students in the larger cities that we’re really just missing the boat on. We have to address that. Other states are doing it with charter schools very well. We’ll eventually get it in Kentucky – I just hate to lose out on the children that will lose out until we get it done.”

And then there is balancing the state budget.

“This is the budget session, so that’s going to be the main focus – trying to figure out how to fund everything we need to fund with limited dollars,” Montell said. “I think the budget is going to be as difficult this time as we’ve ever faced.”

Hornback agreed.

“The over-riding concern this session is going to be the budget – it’s going to control everything,” he said. “The House gets to hold the budget for the first forty days of the session, and the Senate won’t get it until the last twenty days of the session, so we will pretty much try to get the other bills done prior to the budget coming up. Sometimes that changes, and it may be that way this year – we may not do much of anything until we decide what to do on the budget.”

 

Budget concerns

Montell said that one area that will put a serious crimp in the budget is the reduction of funding coming from tobacco.

“The thing is, we know we’re going to be short on the Master Settlement Agreement – the tobacco dollars that we have been getting for years – due to the court’s decision,” he said. “We are going to considerably short; we just don’t know how much yet. We have water and sewer projects out there; the debt service is funded with that. We’ve got early childhood development programs that are funded by that tobacco settlement money, so we have been funding those things in the past with that money. But that money is drying up, so we have to fill in for that.”

Hornback added that funding, which he estimates would be from $45 million to $49 million less this year, also traditionally has paid for many other important programs as well.

“That money not only goes for ag development, but also half of that money also goes to other programs, like women and families, substance abuse treatment, and for a lot of other things, too.”

Hornback said he was also worried about how the state is going to be able to pay for its many highway projects.

“You have to look at state government like a business, and we’ve got to do all the road plans this year for the next two years – what roads are we going to try to build or maintain or upgrade – all that’s going to have to be done this year,” he said.

 

Expenses rising

Montell said that although Kentucky’s $18 billion budget shows a revenue increase of 2 percent this year – $200 million – that increase is cancelled out by an increase in expenditures.

“With one-hundred million [increase] in the retirement fund already committed, and with what we have to do with Medicaid, there’s not any extra money, so we’re looking at how do we provide any raises for our state employees. How do we fund education at a higher lever?” he said. “We need more money to do this [budget] correctly, and the money’s just not there.”

State employees have not received a pay raise in four years, Montell said. Corrections funding is very thin, and on top of that, in education funding, SEEK (Support Education Excellence in Kentucky) monies have stayed at the same level for the past four years.

“That translates into a cut because as the student population grows, that’s less money per student,” he said.

 “Also, we know that Medicaid is running over budget, so we’re going to have to find more money to put into that. The problem with that is, if you don’t fund Medicaid, for every one-dollar in state funding, there’s three dollars in federal funding, so you’re losing seventy-five percent of your funding when you don’t fund your part. So the question becomes, where do you cut and it’s going to be a really tough cycle. I really can’t speculate on that right now.”

Hornback was very somber .

“We’ve had growth in the commonwealth, yes. We’ve got more revenue coming in,” he said. “The problem is, between the health care the loss of money we’ve had through the Master Settlement Agreement, and the increase in retirement that we’re committed to pay now to state employees, that’s going to eat up all the growth we’ve had. So we won’t have room for growth in other programs.”