Vetoed budget fails to address underfunding of government services

Published 8:47 am Tuesday, April 10, 2018

Dear Editor,

This Monday, Gov. Bevin vetoed the revenue and budget bills submitted by the Republican-led General Assembly on April 2. Will the Legislature override or give in to those vetoes? So far, Republicans’ one-party rule has found no solution to Kentucky’s financial problems. Further, the process was marred by secrecy and shutting out the voices of those most affected by changes. Forget democratic dialogue and transparent negotiation. Can we hope for improvements at this eleventh hour?

Kentucky government has long been severely underfunded. Both parties feared tax reform, so budget crises got increasingly worse. Special interests successfully lobbied for tax breaks, which were never re-examined for presumed benefits. Infrastructure — needed roads, bridges, and internet coverage — has been cut. Public higher education has lost 35 percent of its state funding since 2008, causing tuition and fees to rise astronomically, crippling many students with debt and depressing enrollments. Primary and secondary education cuts have endangered educational standards, especially in poorer school districts. Wages for public employees declined against inflation.

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This year, the General Assembly had to meet legal obligations and provide basic public services. Republicans were stymied with competing pressures, wedded as they are to ever-smaller government and lowering taxes, even as need increases. In the bills sent to the governor, most services were cut by 6.25 percent and some zeroed out. Primary and secondary education SEEK levels were met and transportation cuts avoided by raiding the Kentucky Employees Health Plan and other once-off funding sources. Out of all the special interest tax breaks, only the film industry had its subsidies removed (for two years). Hefty state pension obligations were shifted to local governments. Still desperate for revenue, sales taxes were put on some services, but income taxes and corporate taxes were changed to a flat tax of 5 percent. The accumulated effect was a gain of only $75 million to the budget, raising taxes for 95 percent of wage-earners, with $175 million in tax relief to the top 5-percent income brackets. Similarly, taxes would rise on local, small businesses and lower for large corporations.

Now, the General Assembly only needs to leave income and corporate taxes alone and introduce those few consumption taxes to solve its immediate budget shortfall. Surely if most of the population gains, Republicans should not worry about their donors. Then we could have a wider public debate about how to build a better future for all Kentuckians.

Margaret Gardiner