The main items we changed in the House’s budget bill were adjustments that reduced our borrowing and used money more efficiently and wisely. We lowered the debt service ratio (that is the percent of current revenue we direct to paying debt payments) from 7.05 percent in the House to 6.26 percent. Also, we increased the budget reserve trust fund, sometimes called the rainy day fund, to $125 million. We also reduced the structural imbalance (the amount by which current spending is more than recurring revenue) from the proposed $231 million to $153 million. Regarding the road plan, we took out the 1.5 cent gas tax increase that the House proposed.
Though we had differences of borrowing limits and indebtedness, there were several aspects of the House’s budget with which we concurred. We agreed to fully fund the actuarially required contribution of the Kentucky Employee Retirement System and the Kentucky State Police Retirement System, and we also agreed with the raises for State employees for 2015 and 2016.
Education is a key piece of our budget, and always high on the list of priorities. The House’s budget had appropriated $50 million in school technology bonds to fund devices for schools. This means that Kentucky would pay 10 years on equipment that had an average life of three to four years. We did not agree with this method, however, we are aware that updated technology is essential for our students and classrooms. So, we found a better way to fund this initiative. We can provide the equipment, expand the bandwidth for classrooms and implement a statewide Information Technology Academy program with $6.6 million annually, the same amount as what the debt payments would be but without the borrowing. This plan uses a federal E-rate program that will rebate 80 percent of the bandwidth investment, and also can be used for devices for classrooms.
Another big ticket item is healthcare. This year, as the Obamacare program was implemented, without legislative input, the state’s obligations to provide healthcare to uninsured people changed. Under our budget plan, no state funds can be used for Obamacare because the federal government is committed to its funding. If those commitments change, we can opt out of both the exchange and the expanded Medicaid. We also redirected the funds of the Quality and Charity Care Trust for the University of Louisville. Obamacare is the ultimate social net, and if it is working as proponents claim, the additional money is not necessary and can be spent in another area of need.
Additionally, we came up with a plan during conference committee for school districts regarding the unusual amount of snow days. The official last day of school will be June 6; however, districts will have the option to be in session longer if they determine that is what is needed. Districts will submit a plan on making up the hours missed to the Department of Education by May 1. For districts that are unable to reach the 1,062 instructional hours, but have made every effort, the commissioner of the Kentucky Department of Education will waive any remaining hours.
Please continue to contact me with your issues and concerns. You may call and leave a message for me at 1-800-372-7181, or e-mail me at Stan.Humphries@lrc.ky.gov. You can also follow the work of our caucus on twitter at @kysenategop. I appreciate your time and input.
Senator Stan Humphries (R-Cadiz) represents the 1st District including Calloway, Fulton, Graves, Hickman, Lyon and Trigg Counties. He is the Co-Chairman of the Capital Planning Advisory Board, Chairman of the Budget Review Subcommittee on Education, as well as the Vice-Chairman of both the Education Committee and the State and Local Government Committee. He is a member of the Appropriations and Revenue Committee and the Agriculture Committee. For a high-resolution .jpeg of Senator Humphries, please log onto http://www.lrc.ky.gov/pubinfo/senate38.htm.