This week in Frankfort - April 3, 2008

Thank You for your prayers during the 2008 Legislative Session. We still have the last two Veto days, which will be April 14th and 15th. Next week I will the hosting the TeenPact week in Frankfort. We will have a group of between 50 and 60 young home school high school students plus staff from around the country that will come in to help educate these home school students on how government works. It will be a great week of studying, training and fellowship.

Below you will find an overview of what has happened this week in Frankfort. The legislative research Commission provide a great service of keeping us up to date.

FRANKFORT -- Short on days but long on hours and drama, this legislative week saw final passage late Wednesday of a two-year state budget that ameliorated some of the deepest cuts proposed by Gov. Steve Beshear, but did so without the Legislature passing either a tobacco-tax increase or approving a constitutional referendum on casino gambling in Kentucky -- two revenue-generating proposals floated this session to deal with shortfalls estimated at $900 million.

HB 406, which passed the House Wednesday night at 11:15 as the clock ticked toward a midnight deadline, is the budget for the biennium beginning this July 1 and running through June 30, 2010. It had passed the Senate some hours earlier. It was the product of a marathon conference committee of House and Senate members, who worked into an eighth day -- including one last 21-hour, all-night push -- to arrive at a compromise version of the budget agreeable to both chambers.

The two chambers came to those discussions with different revenue assumptions built into their proposals. The Senate in the version it passed last week turned down a House plan to raise the state cigarette tax from 30 cents to 55 cents a pack and to apply the state’s 6 percent sales tax to a few selected services, such as chartered air flights, security services and armored cars. That no-tax view prevailed in the conference committee.

Conferees were under the gun to get the bill passed ahead of the Legislature's 10-day veto recess, which is designed to give lawmakers a chance to override gubernatorial vetoes. The governor has 10 days, excluding Sundays, in which to veto a bill sent to him. That includes individual line-items in the budget bill. By passing the budget Wednesday -- before recessing until the final days of the session on April 14-15 -- lawmakers preserved their ability to override any vetoes the governor imposes.

At this writing Beshear has said he does not intend to veto the entire document, but was reviewing individual line-items as possible targets for his veto pen.

In conjunction with the budget bill, the House and Senate also approved Wednesday a separate but companion measure to provide $150 million for water and sewer projects, and small community projects in coal counties paid for with coal severance-tax receipts. As part of that agreement, some $230 million in state transportation money was freed up for road projects.

The budget bill itself -- which covers some $19 billion in Executive Branch spending for the coming biennium -- passed the Senate 35-3, and the House 74-21.

The budget lawmakers passed restores all or portions of many of the most controversial cuts Beshear had proposed, especially in education. Instead of the 12-percent cuts in higher education he envisioned, this budget imposed only a 3-percent reduction. Base funding for public schools -- including 1-percent raises for teachers and school employees in each of the next two years -- is $43.5 million more in 2008-09 and $85.6 million more in 2009-10 than the administration proposed.

State employees would also get 1-percent annual raises.

The budget also appropriates $60 million in bond funds for the Bucks for Brains program aimed at luring top researchers to state universities, and fully funds the Kentucky Education Excellence Scholarships program (KEEP) for the biennium.

It provides money for new infrastructure at Fort Knox, which is expecting an influx of new troops in the next few years, and for two worldwide events scheduled for Kentucky — the 2008 Ryder Cup golf tournament in Louisville and the 2010 Alltech FEI World Equestrian Games in Lexington. There is a mechanism in the budget agreement for the Louisville bridges project to proceed. Overall, most state government programs receive more funding in the final budget than in the spending proposal Beshear submitted the Legislature in January.

Although taxes aren't raised, the budget finds additional money by replacing fewer state employees when they retire, by refinancing some state debt, by requiring the Kentucky Lottery to contribute more of its profits to the state, and through other efficiency measures.

With passage of the budget, most of the work of this year's session is concluded, although several bills remain in conference committee and could yet be voted on during the two veto days in April. Among those is the state-employees pension-rescue bill, which has yet to be agreed upon in final form by conferees, and would need to be voted on by both chambers. Also still in conference committee is the executive branch ethics-reform bill.