House Republicans unveil two-year state budget with over $1.7 billion in one-time spending

By Tom Latek
Kentucky Today

State Rep. Jason Petrie, R-Elkton, Chair of the House Appropriations and Revenue Committee, has filed that chamber’s $124.8 billion spending plan to cover the next two state fiscal years, starting July 1, 2024.

According to House Republicans, it includes record funding for K-12 public schools, and strategic investments in public safety, infrastructure, and health services. The proposal, designated House Bill 6, also includes major investments in mental health and substance abuse recovery, and programs serving the state’s most vulnerable.

“For far too long our state budget was guided by what was politically beneficial,” Petrie said. “We turned the page on that chapter in our history when we were given the majority in 2016. We know that a robust, fiscally conservative budget is imperative to ensure long-term economic stability and prosperity for the people of Kentucky. HB 6 continues our commitment to investing in our commonwealth’s future while prioritizing responsible spending that aims to efficiently allocate resources while maintaining essential public services.”

He added, “This approach has served us well, allowing us to provide Kentuckians with necessary services while helping amass a historic amount in our budget reserve trust and addressing state debt and liabilities.”

Petrie stressed the House’s commitment to investing taxpayer resources with the goal of getting a return on each investment that will further benefit Kentuckians.

“We do not have unlimited resources and what revenue we have belongs to the people of our Commonwealth,” he noted.  “We have to prioritize spending and look at what Kentuckians get as a result of the money we allocate.”

The House GOP describes HB 6 as the result of two years of legislative efforts as members of the budget committee and House leadership worked with other lawmakers, state and local agencies, and other stakeholders to craft a spending plan that provides a common-sense approach to spending taxpayer dollars while investing in the state’s future.

In addition to the operational budget proposed in the HB 6, Petrie also filed HB 1, an investment proposal that uses excess funds already collected in the state budget reserve trust fund to make significant one-time investments in infrastructure, economic development, public safety, and state employee and teacher’s pension liabilities.

HB 1 includes one-time allocations totaling $1.74 billion over the current and next two fiscal years.

The measure contains:

• $500 million towards the unfunded liability within the Kentucky Teacher’s Retirement System

• $300 million towards the unfunded liability within the Kentucky Employees Retirement System Non Hazardous Pension Fund

• $150 million to pay down the unfunded liability within the Kentucky State Police pension fund

• $450 million to provide the necessary match to approved federal grants through the GRANT program created with the passage of HB 9/2023 Regular Session

• $150 million for drinking and wastewater infrastructure

• $75 million towards site development for economic development purposes under the Kentucky Product Development Initiative program

• $50 million towards the finance authority loan pool for economic development

• $6,395,000 for the purchase of lab equipment for use by the Kentucky State Police

• $15 million for the short line infrastructure preservation program within the Kentucky Rail Development Program

• $15 million for the industrial access and safety program within the Kentucky Rail Development Program

• $18.5 million towards the Riverport Asset Preservation Program

• $11.4 million in funding to provide $200,000 grants to each of the state’s general aviation airports.

Economists anticipate another robust budget surplus when the current fiscal year ends on June 30. According to House Speaker David Osborne, lawmakers can use this and future surpluses to address additional investments in future legislative sessions.

“Maintaining a strong base in the budget reserve trust fund is critical,” Osborne added. “With that accomplished, we can continue to lower the individual income tax, provided the day-to-day, necessary functions of state government, and look for ways to invest in our future.”

House Democratic Caucus leaders in a statement said they were reviewing the proposal and it was too soon to offer a reaction. They pointed to legislation representing Gov. Andy Beshear’s budget proposal which they called “fiscally responsible while investing heavily in education, infrastucture and the economy.”

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