Just when I thought the widespread anxiety caused by those Philadelphia pension consultants couldn’t get worse, the governor asked most state agencies earlier this month to slash their budgets by more than 17 percent to cope with a forecasted $200 million revenue shortage and to beef up the rainy day fund.
No wonder people are nervous. The request follows a 9 percent cut that is part of the state’s current budget as well as a series of other cuts implemented since the Great Recession in 2008. Some state agencies have already lost more than a quarter of their annual funding. And this requested cut has nothing to do with trying to fund the public pension system.
While the governor said the primary schools funding program known as SEEK, universities, Medicaid and corrections department would be exempted from the requested cuts, the cuts could still be devastating.
Just look what Kentucky’s prosecutors testified to at the recent meeting of the Interim Joint Committee on Judiciary. One longtime and well-respected Commonwealth’s attorney put it bluntly: “The criminal justice system will come to a halt.”
Senator Ridley
That Commonwealth’s attorney said staff cuts would negatively affect the state’s heroin Rocket Docket – an efficiency program in place in over 30 of the state’s 57 judicial circuits that puts treatment ahead of incarcerating drug offenders. Local jails statewide are on track to save around $50 million by the end of fiscal year 2018 due to the success of the Rocket Docket program, according to information provided to the committee.
Henderson County Attorney Steven Gold, who is also the president of the Kentucky County Attorneys Association, also testified. “If we are to believe that out of the crucible that is court comes justice, we must have good people – well-funded, well-trained people – on both sides to make that justice a result,” he said.
The state’s 120 county attorney offices collect child support, serve as a financial watchdog, advise and assist county governments, in addition to handling mental health, guardianship, child dependency/neglect/abuse, truancy and runaway cases.
The prosecutors also testified that the Kentucky State Police face potential cuts that could be detrimental to public safety. It has been reported that troopers are retiring faster than they can be replaced and the agency is operating with outdated, run-down squad cars and other equipment.
The state attorney general has even weighed in. He called the requested cuts illegal. He said state law clearly does not allow a governor to cut agency budgets to replenish the rainy day fund. He said state laws and a recent Kentucky Supreme Court ruling restrict such emergency spending cuts to cover the amount of an officially projected revenue shortfall.
The shortfall projection was made in August by a team of economists called the Consensus Forecasting Group that makes revenue forecasts for budgeting purposes. While the rainy day fund had a $150.5 million balance as of July 1, it is expected to be depleted before this fiscal year ends June 30.
Others say we need to reform Kentucky’s outdated tax code. For example, Kentucky loses about $580 million per year from corporate tax breaks and unofficial tax dodging, according to a report that came out from Good Jobs First. To look at that figure from another perspective, the annual taxpayer cost of funding the retirement benefits of current Kentucky public employees belonging to the Kentucky Retirement Systems equals 69 percent of the cost to the state of economic development subsidies and corporate tax breaks and loopholes.
All of these issues, and more, will be vigorously discussed when we return to Frankfort on Jan. 2 to pass a 24-month budget that will take effect on July 1. I encourage you to stay in touch to share your input on the issues facing our Commonwealth. You may leave me a message by calling the toll-free Legislative Message Line at 800-372-7181. You can also e-mail me directly at Dorsey.Ridley@LRC.KY.GOV.
Dorsey Ridley is chair of the Senate Caucus. He is from Henderson.
