Jan. 4, 2016 - A comprehensive preview of the upcoming two-year Kentucky state budget confirms both a massive funding gap facing the state for the next two years and a need for reinvestment in many areas post-recession.
Authored by the Kentucky Center for Economic Policy (KCEP), the report notes that expected growth in state revenue the first year of the new budget will be at least $500 million less than basic new costs the state will face in pensions, corrections, Medicaid and school population growth alone. More resources will need to be found if Kentucky hopes to roll back cuts to services harmed by 15 rounds of reductions since 2007 or make new investments that could move the state forward.
"Despite an improving economy, our budget situation isn't getting better," Jason Bailey, executive director of KCEP, said. "That's in part because we've skipped required payments to our pension systems in past budgets and those bills are coming due. To improve our state, we need a budget that meets those obligations while also investing in the foundational systems that benefit us all."
With a more than $10 billion budget, one way to get back to building thriving communities with strong schools, roads and other necessities is to look at the more than $12 billion the state is giving away in tax breaks.
"Our state is leaving money on the table that could be used for schools, college affordability and enhancing the health of our state," Bailey said. "We can't solve our budgetary problems, and build a stronger Commonwealth, until we begin cleaning up the tax code to generate new revenue."
The 37-page report is broken into two parts - the first section dealing with Kentucky's budgetary needs and challenges and the second with the state's broken revenue system. A copy of the report can be found here.
"Lawmakers' choices in the next budget will have big implications for our Commonwealth not only today, but far into the future," Bailey said. "The longer we wait to invest in our communities and improve our fiscal picture, the bigger our challenges will become."
For more information contact: Kenny Colston at 502-938-1817 or firstname.lastname@example.org
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The Kentucky Center for Economic Policy is a non-profit, non-partisan initiative that conducts research, analysis and education on important policy issues facing the Commonwealth. Launched in 2011, the Center is a project of the Mountain Association for Community Economic Development (MACED).
Kentucky Center for Economic Policy
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www.kypolicy.org | email@example.com