So where does the Ky. budget bill stand?

FRANKFORT, Ky. – As university presidents and advocates for other state programs protest Gov. Matt Bevin’s proposed 9 percent funding cuts, deadlines are fast approaching for lawmakers to start shaping a final state budget.

But the uncertainty over the balance of power in the Kentucky House and the nature of Bevin’s budget proposal make it difficult to figure out where this budget is headed and raise the question of whether the House and Senate can reach a final agreement before their April 15 deadline.

So, with 36 days already consumed in a legislative session that lasts just 60 days, here are some answers to your questions about where the 2016-18 budget bill – House Bill 303 – stands.

Q: Has Bevin been moved by the outcry of folks saying his cuts would reverse gains in postsecondary education, hurt public schools, close courts for at least three weeks, and impair a myriad state of services?

“His position on everything in the budget remains unchanged,” said Bevin Budget Director John Chilton. “The cuts are not something the governor necessarily sees as desirable but are necessary to accumulate funds to deal with the pension issue.”

The administration believes unfunded liabilities of more than $30 billion within state pension funds pose a crisis that must be addressed in a major way in this budget, which Bevin’s budget does with additional $1.1 billion in appropriations.

“The pension issue is the focus of the whole budget,” Chilton said. “… If it’s not addressed now, it will grow so large that it can’t be coped with.”

Will the General Assembly make changes, and will money be restored – at least somewhat – to universities and most programs that Bevin proposes to cut?

Yes, the General Assembly always changes the budget. The second part of that question is much harder to answer but it seems more likely than not that lawmakers will at least ease the pain in some areas.

Many Democrats on the House budget committee have endorsed and echoed the argument that particularly the education cuts would be a serious setback. Rep. Rick Rand, the Bedford Democrat who chairs the House budget committee, said his committee is looking for possible relief from $1 billion in unspent funds in the Bevin budget “to see if some of that can be invested in important programs now.”

Rand is referring to a beefed up Rainy Day fund proposed by Bevin to guard against possible revenue shortages and a new half-billion dollar “Permanent Fund” Bevin proposes for future outlays addressing the pension crisis.

As to how far his committee can go in restoring money Bevin proposes to cut, Rand said, “I don’t know at this point. … We’re not in a position to make that call just yet.”

House Speaker Greg Stumbo, D-Prestonsburg, said Friday that the House budget may borrow about $300 million to fully fund the so-called ARC (actuarially required contribution) in the next two years for the Kentucky Teachers Retirement System. For all Bevin’s budget provides in new cash appropriations for KTRS, it does not fully fund the ARC.

House Republican Leader Jeff Hoover, of Jamestown, said of the Bevin budget: “There have been concerns expressed. Hopefully as we go through this process we can flesh some of those out and see if we can make it more palatable for some folks.”

Hoover said House Republicans have been meeting frequently and decided on ideas to improve Bevin’s budget – ideas he declines to discuss for now.

But Hoover stands firm behind Bevin’s basic approach: “What I have found, by and large, is that the people of Kentucky say you have got to cut government, you’ve got to quit spending like you’ve been spending. And from that standpoint I think they appreciate the governor’s approach.”

Senate President Robert Stivers, R-Manchester, said, “The governor is taking us in the right direction. … But are there different ways to reach the point he wants to get to? Yes.”

What are the next steps?

The House budget committee will make its changes to the budget and send its version to the House floor for a vote that will send it to the Senate.

This is where the tenuous Democratic control of the House and March 8 special elections raise potentially unprecedented complications.

Normally, after about six weeks of public testimony, the Democratic majority leaders and key members of the budget committee work out final changes of the bill that the House budget committee approves and that the House (behind a solid Democratic majority) passes.

Currently there are 50 Democrats and 46 Republicans in the House, with four vacancies to be filled in the special elections. So if the Republicans sweep those four, the House is tied at 50-50.

When does the House budget committee plan to meet to approve a budget bill?

A date hasn’t been set, but apparently not until after the special elections and probably the week that begins March 14.

Stumbo said Friday that meeting will take place “probably in a couple weeks.”

Rand said, “Probably the third week of March.”

March 14 (which will be day 47 of this 60-day session) would, by recent history, be a little bit late. The House passed budget bills in the most recent four budget sessions between March 7 and 13, according to the legislative records for those sessions.

Rand said Bevin’s proposed budget is taking more time than normal to review because it is “drastically different” than others in many ways including that Bevin has not specified how cuts will be applied within his cabinets. But Rand said his committee will be prepared to approve a budget “that we believe can pass the House and expresses the priorities of the House.”

Hoover said House Republicans “are prepared to move forward. We could move forward Monday.”

Do Hoover and Stumbo agree on the process to be followed in the next few weeks?

No. Hoover says the Kentucky Constitution requires a constitutional majority of at least 51 votes for the budget bill to pass out of the House, and he cites a recent Legislative Research Commission memorandum supporting that interpretation.

Getting 51 votes, Hoover said, will be “extremely difficult” to achieve “because the majority party in the House has not made any attempt to try to work with us or reach out to us on budget matters.”

Stumbo disagrees. “Every one of our budget subcommittees contains minority members” that have been fully participating in budget hearings, he said. And Stumbo has a different interpretation of the law and says the House’s initial vote on the budget bill to send it to the Senate does not require 51 yes votes, but can pass on a majority vote of fewer than 51.

Hoover and Stumbo also disagree on what happens to the makeup of the budget committee – where Democrats now have the majority – if the special elections produce a 50-50 split. Hoover said House rules require realignment and equal representation of both parties on all committees. Stumbo says committee memberships were set during last year’s organizational session and it will take 51 votes in the House to change the membership of committees.

So what exactly will happen to the budget bill if the House ends up in a 50-50 split when it convenes on March 9?

This is uncharted water and would affect all legislation, not just the budget. Republicans hope a sweep would give them such a jolt that perhaps a House Democrat would decide to caucus with the GOP and vote for a GOP version of the budget bill. Democrats say their ranks will hold firm.

Of a possible 50-50 split, Rand said, “If that happens we’ll deal with it then.”

Hoover said, “I’ll share with you on the night of March 8 what our options are.”

Reporter Tom Loftus can be reached at (502) 875-5136 or [email protected]