From the KCEP: Legislature to Pass a 1-Year Austere Budget With Major Uncertainty as to Revenues

EDITOR'S NOTE: Click here to read a Forward Kentucky synopsis of the budget bill, which passed Wednesday.

Thanks to Jeff Wiggins for sending us the following story.

Kentucky Center for Economic Policy

The legislative leaders meeting on an executive branch budget finalized a Free Conference Committee Report (FCCR) that covers only one year of the biennium and simply continues current funding levels for most services across state government. The FCCR lacks raises and new monies for needs like social workers to address our crisis in child protection, and freezes funding contribution requirements for quasi-governmental organizations like health departments and community mental health centers at the current 49% of employee pay (as opposed to a spike to 93%).

The FCCR is based on a more pessimistic revenue forecast than the original forecast, and spends $231 million less for 2021 than the governor originally proposed. That pessimistic forecast may prove optimistic, however, given the economic crisis and expected revenue shortfalls that are the result of the COVID-19 pandemic.

The full report can be found here: Legislature to Pass a 1-Year Austere Budget With Major Uncertainty as to Revenues. Since the budget covers only 2021, the General Assembly will have to pass another budget before June 2021 to cover fiscal year 2022. That budget will require a 3/5 vote in each chamber to pass during the regular legislative session next year. 

The Kentucky Center for Economic Policy is a non-profit, non-partisan initiative that conducts research, analysis and education on important policy issues facing the Commonwealth. Launched in 2011, the Center is a project of the Mountain Association for Community Economic Development (MACED). For more information, please visit KCEP’s website at www.kypolicy.org