Tuesday, February 16, 2010

Stumbo provides broad outline of House budget plan

We have been saying for weeks that the politics of this session will revolve around the state budget. The House and Senate Leaders have essentially cut the Governor out of the budget process, after he sent the legislature a budget that was based on nearly $800 million in new revenue from expanded gaming that the legislature hadn't dealt with yet. The legislature decided to proceed their own way on the budget without the gaming revenue.

It has been speculated for some time that the legislature would rely on a mix of cuts, sweeping funds, and pulling money out of Medicaid due to an enhanced Federal Match in order to balance the first year of the budget and would rely on more drastic cuts in the second year of the budget. All of this is based on the idea that the legislature will get past the November elections and force the Governor to have to deal with raising revenue in January 2011 when he is up for re-election in November 2011.

With the House unveiling their budget this week it appears that the session will now begin to get underway. The Herald-Leader article below has more details on the House's budget plan.



Stumbo provides broad outline of House budget plan: "House Speaker Greg <span class=

By Beth Musgrave - bmusgrave@herald-leader.com

FRANKFORT — House leaders are poised to unveil a state budget proposal in coming days that cuts more than 250 political appointees, trims spending on private contractors, tinkers with the state health insurance program and delays some construction projects.

House Speaker Greg Stumbo, D-Prestonsburg, also said the plan will rely on $220 million in not-yet-approved federal support for the Medicaid program.

The proposal, which Stumbo described vaguely for reporters, would eliminate a projected $400 million shortfall in the first year of the two-year state budget. Much of those savings would carry over into the second year of the budget, but lawmakers still must determine how to overcome a remaining $200 million shortfall in the second year.

“We have balanced in the first year, we have some carry forward actually and we are very, very close in the second year,” Stumbo said.

The first year of the budget, which begins July 1, does not include any cuts to the main funding formula for schools or cuts to the state Medicaid program, Stumbo said.

However, it does call for reducing the number of state workers to 2007 levels across the judicial, executive and legislative branches, Stumbo said.

Specifically, Stumbo said there are about 250 non-merit positions -- political appointees -- that have been added to the executive branch since 2007."