June 2, 2010 — By KY State Senator Robin Webb FRANKFORT-- The General Assembly passed a budget last week during the 2010 Special Session.  A month after the regular session adjourned without one, Governor Beshear proposed a compromise that, with some slight tweaks by the House and Senate, resulted in a spending plan that we could accept and that will help us get through the next two years while the economy recovers.

As it stands, no one is really happy with the spending plan -- but then no one is happy with the state of our economy or any of the choices we faced in crafting this budget. Our position all along has been to protect education, social services, and public safety as much as possible while recognizing that all areas of government must share in the sacrifice and that some savings can be found virtually everywhere.

Under our $17.1 billion dollar spending plan for the next two years, taxes will stay as low as they are now, because Kentucky families are facing enough burdens already. At the same time, this budget authorizes the smallest debt load since 1996, acknowledging the fact that a truly balanced budget focuses not only on the next two years, but on the years after that when interest on our State debt must be paid.

The budget also preserves our full 177-day school year to keep our students competitive in the 21st Century economy. The Senate has consistently focused on our public schools as a key tool in our economic development, and now is not the time to take a step backward. At the same time, we made sure that new school construction for Category 5 schools (those in most need of replacement) follows the needs and desires of the local school districts, not politicians in Frankfort. School districts that levy a “second nickel” tax -- an extra 5 cents per hundred dollars of valuation -- would be eligible for State matching funds to construct new facilities to replace their most deficient buildings. Some districts have already made that effort, and we hope the rest will follow suit to make maximum effort toward new and modern facilities.

Another key economic development item is the construction and repair of our roads and bridges, and the road plan we passed last week will keep those projects moving, providing jobs to thousands of Kentuckians. The $3.6 billion plan includes not only funding to continue the Louisville Bridges project to revitalize our largest city and economic engine, but more than $100 million to improve the area around Fort Knox, which will soon receive thousands more soldiers and civilian employees due to Base Realignment and Closure.

The budgets were not the only items on our agenda, though. We also passed House Bill 5, which will reform our unemployment insurance trust fund. With the recession taking its toll on employers, more Kentuckians need assistance from the State’s unemployment pool. In fact, our trust fund is depleted and we are borrowing money from the federal government to cover these claims — $800 million and counting. It is obvious the system must be overhauled, and leaders from both the business and labor communities have come together to craft a solution. Under HB 5, employers will pay more into the trust fund, while employees will receive less generous benefits beginning in 2012. The changes are only slight, however, and Kentuckians would still receive unemployment compensation in line with what other states are paying.

In 2000, when the economy was rolling along -- thanks to the technology boom, employers were given a discount and employees got a bump in benefits, both of which made the fund unstable when the economy bottomed out last year. HB 5 should restore that structural balance.

Unless pressing issues arise again in the coming months, we will conduct information-gathering meetings during this interim and return to Frankfort in January for our 2011 Regular Session. Between now and then, stay in contact with me through our Legislative Message Line at 1-800-372-7181 or by e-mailing me at  robin.webb@lrc.kly.gov to let me know how you feel about the problems facing our Commonwealth.

Senator Robin Webb represents Bracken, Carter, Greenup, Lewis, Mason and Robertson counties.