Beshear Calls for Tax & Pension Reform, Education Improvements

Kentucky Governor Steve Beshear gave his sixth State of the Commonwealth Address before the General Assembly in Frankfort Wednesday night. A theme that emerged during the speech is that Kentucky weathered the storm of economic recession, but at what cost? In particular, education in the state has suffered greatly as the Commonwealth's budget has been repeatedly shrunk during the long economic crisis.

The state budget was cut thirteen times in five years, Beshear said, cutting spending by $1.6 billion and lowering the state workforce to its smallest size in four decades. 

Beshear highlighted some of the casualties of those cuts:

  • funding frozen for K-12 education despite rising costs
  • textbook funding eliminated completely; from $21.7 million in 2008 to zero today
  • school safety funding cut by sixty percent
  • funding cut at 2-year and 4-year colleges resulting in tuition increases of four and seven percent, respectively
  • reduced aid to needy student (73,000 would-be students denied in one year)
  • child-care assistance programs cut
  • health department funding cut, resulting in fewer immunizations for needy children
  • services for senior citizens cut including 300,000 fewer meals delivered by one agency alone

"But, now that we're emerging from this recession it's time to repair the worst of this damage, rebuild those programs we never wanted to cut, and reinvest in our future," Beshear said. The governor warned that increased revenue from economic growth will not be enough to cover the forthcoming bills. He wants tax reform.

"We need a tax system that is fair to all our citizens and easy to understand; that helps recruit business, not drive it away; and that, because it's aligned with a twenty-first century economy, is able to fund the revenue we need to fund critical services," Beshear said.

"Our schools aren't treading water. They're slowly sinking."

Beshear detailed some of the ways that education coffers have been raided to save the state budget: $75.8 million in funding that would go toward textbooks, training, tutoring, and dropout prevention; The state also took $24 million from lottery revenue to balance the state budget. Those funds would have gone toward financial aid.

"Money doesn't solve every problem, but when don't spend even a dime on textbooks, progress is difficult," Beshear said. Are we courageous enough to invest in our children's future?"

Pension reform looms

The governor also highlighted pension reform as a priority but said that any decisions to fund the retirement system would not affect education. "As we work to make our public pension system whole again, I will not allow our schoolchildren to be collateral damage," he said.

Beshear said that his administration has not fully funded the ARC (actuarially required contributions to pensions) because it would have required deeper cuts to education and public safety. He, again, believes that modernizing the state tax code will help generate some of the necessary revenue to fulfill the pension obligations.

The governor wants legislation on both pension reform and tax reform this year.

Other issues receive attention

Governor Beshear also spoke in favor of a statewide smoking ban, he wants to improve last year's bill that fights pain pill abuse, he wants to raise the drop-out age, and authorization of agency bonds for university projects.

He also expects the legislators to work together and with him. "Look, no matter what our political affiliation, we want the same things," Behsear said. "Good jobs with respectable pay, rigorous schools, safe neighborhoods, economic opportunity for our children, accessible and affordable health care."

"So it's our duty to ensure that the trust invested in us as their state government is treated with respect and sanctity."

"In short, the people expect us to lead. In the coming year, you and I must come together to attack the weaknesses that are holding Kentucky back and find ways to invest in our people," Beshear said. "I believe we can and I believe we will."

Written by Michael Monks, editor & publisher of The River City News

Photo: Gov. Steve Beshear