budget

State legislative leaders met today in an attempt to revamp the state's crumbling retirement system.

The marathon session began this morning and resumed this afternoon as key legislators in the house and senate try to hammer out a compromise over Democratic Gov. Steve Beshear's proposed changes to the pension system.

As PolitickerKY.com reported last week, Beshear's proposal includes increasing the retirement age for future state employees, a decrease in the cost of living adjustment, and reforming the practice of receiving a government salary while drawing on a pension.

If leaders from both chambers agree to some changes to the retirement plan by the end of the month, Beshear will call a special legislative session to finalize the legislation.

According to a recent report from Kentucky's Finance and Administration Cabinet, the current pension system has an unfunded combined liability of $26 billion.

The Lexington Herald-Leader reports the state budget may have been saved from the scrapheap by the last-minute distribution of "$150 million in coal severance tax and tobacco settlement money for local projects."

"We are appalled and indignant. We only wish the budget were a bad April Fool’s Day joke."

That was the denouncement articulated by the Kentucky Education Association (KEA) of the budget compromise passed out of conference committee this week.

PolWatchers reports lawmakers in Frankfort made progress in the budget conference committee when a "tentative" agreement was reached at 7am today.

The budget appears to cut funding to higher education programs less-dramatically that in Governor Beshear's initial budget draft. There are also 1 percent pay raises included for the state's teachers.

Many of Governor Steve Beshear’s proposed tax increases are not likely to be passed by the Republican-controlled Senate, according to State Senator David Boswell (D-Owensboro). “It’s not looking like any possible revenue increases related to taxes will be passed,” said Boswell. “Maybe – absolutely maybe – we will see a small increase in the cigarette tax.” Boswell, who sits on the Senate’s Appropriations and Revenue Committee, said he has yet to see the Republican budget plan and does not expect to until Monday.

FRANKFORT -- Democratic Governor Steve Beshear implored Kentuckians to “pressure” state legislators to support his proposals to both raise cigarette taxes and permit casino gambling during a morning rally at the state capital.

State Senate President David Williams (R-Burkesville) told the Courier-Journal that the Senate is not likely to approve a budget resembling the version passed by the Democratically-controlled House last week. That version included a 25 cent per pack tax increase and a sales tax hike on services such as armored cars and commercial laundering. House leaders indicated they saw these as necessary provisions to avoid dramatic spending cuts.