Published: April 03, 2008 06:35 am            

UPDATED: State budget passes with side deals

It took what House budget chairman Harry Moberly, D-Richmond, called a “diabolical deal with the devil,” but the House late Wednesday passed a two-year, $19 billion state budget. The vote was 74-21 with all 21 no votes coming from Democrats, including Moberly. All but four Republicans voted for the budget.

Hours earlier, the Senate passed the same budget 35-3.

The budget hinged on a deal brokered by Senate President David Williams, R-Burkesville, and Rep. Greg Stumbo, D-Prestonsburg, the one-time House Majority Leader. It restored line-item coal severance projects in coal producing counties and authorized $100 million of bonds for water and sewer projects in non-coal counties.

The budget was hammered out just after dawn on Tuesday by negotiators from each chamber. It includes no tax increases – as the House wanted – and reduces funding for higher education, health and human services and provides 1 percent raises for teachers and state employees.

But it did not contain the water and sewer projects, and the Stumbo-Williams deal secured the votes of 32 Republican House members, several of whom earlier in the day said they would vote against the budget without projects for their districts.

During budget negotiations between the two chambers, Moberly insisted if the Senate would not agree to raise the cigarette tax and other revenue measures in the House budget to restore funding cuts to education and health and human services, there could be no capital projects such as those in the deal Stumbo and Williams worked out. And the Senate wanted to remove the legislatively earmarked projects in the coal producing counties which are financed by coal severance taxes.

Rep. Robin Webb, D-Grayson, the vice chair of the budget committee, presented the bill in the House rather than Moberly who normally does it. But Moberly rose and said he would vote against the bill because it “is a bad budget for education and human services, really bad, the worst I’ve seen.”

He said Williams had bought off the House with the projects and “we are clearly becoming the subservient body, like puppets on a string,” calling it “a diabolical deal with the devil.”

Several other Democrats railed against the bill, including Rep. Johnny Bell, D-Glasgow. He voted against the budget because it did not include funding to replace the Glasgow State Nursing Facility which “takes care of some of the sickest individuals in the state,” but includes $1.65 million for an airplane for a community college airplane maintenance program and several million dollars for museums.

Rep. Jim Wayne, D-Louisville, said the budget will “ensure we will get sicker, be less educated, have less access to basic justice in our courts and drive on unsafe highways.”

But in the end it passed and now goes to Gov. Steve Beshear for his signature or veto. Beshear may find it difficult to veto the budget because he originally proposed a “painfully austere” budget with no tax increases. He tried to pass a constitutional amendment to allow casino gambling to produce more revenue and later reversed himself and proposed an increase in the cigarette tax. The Senate refused to consider higher taxes.

Only one Republican Senator, Richie Sanders of Franklin whose district includes Glasgow, voted against the budget because it did not fund the Glasgow State Nursing Facility.

The budget provides nearly $200 million in additional money through employee retirement savings ($85 million each year), $7 million each year from the lottery, about $50 million from restructuring some existing state debt, and about $100 million over two years from government efficiencies.

But it reduces funding for higher education by roughly 3 percent from current funding which has already been reduced this year by 3 percent. That almost certainly means higher than expected increases in tuition. It includes debt service from the general fund for $417 million of projects and debt service from the road fund for $135 million of road bonds. That’s on top of the bonds for water and sewer projects. It cuts $40 million in health and human services but provides $10.3 million in road funds for the Kentucky Horse Park to prepare for the 2010 World Equestrian Games.

Late Wednesday night, after the budget passed both chambers, another bill was passed restoring the line-item projects in coal counties. A “supplemental” appropriation will be worked out during the interim between Wednesday and April 14 when lawmakers return for two days to consider any vetoes by Gov. Steve Beshear. They’ll pass the supplemental bill at that time – but that means if Beshear vetoes it, it can’t be over ridden.

Rep. Tommy Turner, R-Somerset, said Wednesday night he was told an agreement was worked out with Beshear not to veto the projects and he planned to vote for the bill because of the need for water and sewer infrastructure in Pulaski County.

When the day began, passage was in doubt. House Democrats caucused for two hours, and many of them were unhappy when they emerged. Several said there were no more than 35 to 40 votes for the budget. But the deal on projects was enough to secure all but four House Republican votes to go with 42 Democrats’ votes.



Ronnie Ellis writes for CNHI News Service and is based in Frankfort, Ky. He may be contacted by email at HYPERLINK "mailto:rellis@cnhi.com" rellis@cnhi.com.

        

• Click to discuss this story with other readers on our forums.