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Analysis

Where Dollars Moved in the House Version of the State Budget

Jason Bailey | March 13, 2014

The version of the state budget the House passed today is very similar to what the governor proposed in January. The main changes in budget allocations involve a little more money for a variety of smaller human service-related programs and slightly less General Fund money for P-12 education and Medicaid.

The House also did not go along with the governor’s proposal to charge special districts a fee to help pay for Property Valuation Administrators (PVA). That meant the House had to restore General Fund dollars to the PVAs.

More On Budget & Tax: Does the Racing Industry Get a “Sweetheart Deal” on Taxes? This Republican Thinks So.

Here’s a rundown of the main areas of the budget that get more or less General Fund monies from the House than what the governor had proposed (dollar amounts are over the biennium unless described otherwise, and are relative to the governor’s proposal):

What receives more:

  • Property Valuation Administrators: +$31.8 million
  • Rates paid foster parents: +$10 million
  • Commonwealth’s and County Attorneys:+$6.1 million
  • Private child care provider rates: +$6 million
  • 15 additional social workers in Department of Public Advocacy: +$2.6 million
  • Family Resource Centers and Volunteer Services: +$2 million
  • Placing children with non-parental relatives: +$2 million
  • 10 additional front-line guardianship workers: +$2 million
  • Debt reduction for libraries: +$2 million
  • Homeland Security for enhanced 911 emergency services: +$1.6 million
  • Economic Development Cabinet for entrepreneurship support & business development staff: +$1.4 million
  • Kentucky Legal Education Opportunity Program: +$500,000
  • Vocational Rehabilitation to match available federal funds: +$500,000

What receives less:

  • Medicaid: -$25 million (most of which is replaced from restricted funds)
  • P-12 textbooks & instructional materials: -$10 million
  • Preschool: -$10 million
  • SEEK (K-12 funding formula): -$7 million
  • Department of Public Health (including deletion of monies for HANDS program expansion): -$5 million and another -$5 million from FY 2014
  • Department of Revenue: -$4.4 million
  • Correctional institutions: -$1.5 million

The budget is balanced with $7 million more in fund transfers than what the governor had proposed. Those additional transfers come from the Horse Racing Commission, the Department of Insurance, public safety employee training funds and the underground storage tank cleanup fund.

It is also built with the expectation that the state will net $4.8 million in additional funds from instant racing, $20 million from selling abandoned property, and $3 million more from lottery due to advertising that its earnings go to college scholarships (primarily though not entirely). The LRC budget director reports that the House budget would have a structural imbalance at the end of the biennium of $229.5 million—very close to the $231 million in the governor’s proposal—and would add $1.5 million to the rainy day fund.

Overall, the House budget tinkers around the edges of what the governor set forth. It takes some General Fund money from larger parts of the budget—P-12 education and Medicaid—to plug holes in smaller programs in human services and other areas. It passes costs off to the future and leaves intact new cuts of 2.5 percent to 5 percent for a range of areas that have already been cut drastically in recent years, from higher education to regulation of fair working conditions to environmental protection.

Updated March 14, 2014.

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