Kentucky state budget
From Sunshine Review
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Kentucky faced a FY 2009 budget deficit of more than $500 million by the end of the fiscal year on June 30, 2009. Gov. Steve Beshear and the Kentucky Legislature balanced the FY 2009 budget without using State Fiscal Stabilization stimulus dollars. $358 million of stimulus funding will be part of the plan to close the estimated $1 billion shortfall for the current fiscal year, FY 2010. The Kentucky Legislature met in a Special Session[1] this summer to authorize state agencies to make additional, and necessary cuts to keept the FY 2010 budget balanced. The state has $300 million in federal stimulus funding to bridge the FY 2011 deficit, which will be considered when the Kentucky Legislature convenes from January 5 to April 13, 2010.[2][3]
Kentucky's state revenues continue to decline for the first quarter of FY 2010 compared to FY 2009. General Fund collections dropped 9.8% for the month of September 2009 compared to September of 2008 and 5.6% less for the July to September quarter. The FY 2010 budget basis anticipated a revenue decline of 1.5% from FY 2009.[4]
Kentucky budgets for 2-year cycles on a biennium basis. The enacted FY 2010 General Fund budget is $9.62 billion. The 2008-2010 biennium budget originally passed in 2008 was $19.1 billion in General Funds, total funds $53.2 billion.[5]
[edit] Budget Background
2008-2010 Biennium General Fund Appropriations $19.1 Billion[6]
| Category | Percentage |
| Education | 43.8% |
| Postsecondary | 13.7% |
| Medicaid | 13.3% |
| Other | 11.5% |
| Criminal Justice System | 10.2% |
| Human Services | 7.4% |
2008-2010 Biennium Total Fund Appropriations $53.2 Billion[7]
| Category | Percentage |
| Postsecondary Education | 20.1% |
| Medicaid | 20.0% |
| Education | 18.5% |
| Other | 11.8% |
| Transportation | 8.6% |
| Capital Projects | 8.3% |
| Human Services | 7.9% |
| Criminal Justice System | 4.8% |
In Kentucky the legislature passes biennial budget bills which includes two fiscal years. However, the state's fiscal year begins July 1st and ends June 30th of the following year. The budget includes appropriations for the state's operating and capital budget and recommendations made by each state agency. Estimates of the General Fund and Road Fund revenues are compiled by the Consensus Forecasting Group. Prior to the Governor's approval the budget passes through first the House of Representatives and then the Senate for amendments. After a series of hearings the Governor can either approve the budget as approved by the Legislature or continue to amend the bill through vetoes. Once the budget is approved, amendments can be made to the budget bill as necessary. [8]
[edit] Budget figures
The following table provides a history of Kentucky's expenditures and gross domestic product (GDP).
| Fiscal Year | Expenditures (billions) | GDP (billions) |
|---|---|---|
| 2000 | $21.5 [9] | $111.9 [9] |
| 2001 | $23.1[9] | $115.1[9] |
| 2002 | $24.8[9] | $120.7[9] |
| 2003 | $25.8 [9] | $124.9 [9] |
| 2004 | $26.9[9] | $131.7[9] |
| 2005 | $27.0[9] | $138.5[9] |
| 2006 | $29.5[9] | $146.4[9] |
| 2007 | $32.3[9] | $154.7[9] |
| 2008 | $35.3[9] | $162.4[9] |
| 2009 | $38.6* [9] | $171.0* [9] |
- NOTE: The figures for FY 2009 won't be finalized until the end of the fiscal year.
- See Kentucky state budget (2008-2009) for more details.
[edit] Accounting Principles
The Kentucky Auditor of Public Accounts has been Crit Luallen since her first election in November of 2003. Luallen was named 2009 'Public Official of the Year' by Governing Magazine. Kentucky's audit reports may be searched online. The Reorganization Act of 1936 established the Auditor of Public Accounts as an impartial auditor entirely independent of state administration and charged the office with the responsibility to audit the accounts and financial transactions of all spending agencies of the Commonwealth. This remains the primary function of the Auditor of Public Accounts today.
The Institute for Truth in Accounting (IFTA) rates Kentucky “Tardy” in filing the state’s Comprehensive Annual Financial Report (CAFR) – The annual report of state and local governmental entities. IFTA rated 22 states timely, 22 states tardy, and 6 states as worst. IFTA does not consider Kentucky's CAFRs, and those of the other states, to be accurate representations of the state’s financial condition because the Generally Accepted Accounting Principles (GAAP) basis does not include significant liabilities for the pension plans and for other post employment benefits, such as health care.[10] Kentucky's CAFRs are published online by the Finance and Administration Cabinet and the Office of the Controller. Jonathan Miller is Secretary of the Finance Administration Cabinet and Edgar C. Ross is Kentucky State Controller.[11]
The Secretary of Finance provides executive policy and management for the departments and divisions of the Cabinet and serves as the chief financial officer and manager of the financial resources of the Commonwealth. The Kentucky Office of the Controller is responsible for all state accounting policies and procedures, cash management and strategic financial planning. The Controller acts as the commonwealth’s chief accounting officer.[12]
| Credit Rating | Fitch | Moody's | S&P |
| Kentucky[13] | NR | Aa2 | AA- |
[edit] Economic Stimulus Transparency
- The Economic Recovery and Reinvestment Act of 2009 designated $787 billion to be spent throughout the U.S. Of that $787 billion stimulus package, it is estimated that 69%, or over $541 billion, will be administered by state governments.[14]
- Kentucky will receive an estimated $2,090,341,858 [15]
- The economic recovery website to show how legislators and government officials in Kentucky are spending Federal funds is available here.
[edit] News
Kentucky's comprehensive spending transparency website, called "Kentucky's Open Door,"[16] continues to be updated with new state spending information. Information about state employee salaries, contracts, and grants is now available online.
The site was implemented at the recommendation of a task force[17] created thanks to the executive order[18] of Kentucky's Governor Steven Beshear.
Sign up for Show Me The Spending's weekly transparency e-updates. As transparency news about Kentucky becomes available, it will be sent out by email and posted on this page.
[edit] Government tools
Check It Out Kentucky! provides a searchable database of the Secretary of State's financial information, organized by categories such as expenditures and vendors. In addition, the Office of the Treasurer has developed a site, V.I.E.W. (Vendor Income and Expense Watch), that posts information on contract amounts, contractors, and the government agency issuing the fund. Currently, V.I.E.W. contains financial information for only a handful of state agencies, including the Auditor of Public Accounts, the Department of Highways, the Kentucky State Treasury (State Treasurer), and the Office of the Controller.[19] Data from other agencies will be placed online as that data is approved for release. See the official V.I.E.W. website for more details.
Kentucky's Open Door provides spending information including state expenditures on grants, contracts, and public employee salaries. Click here to visit the site.
The following table is helpful in evaluating the level of transparency provided by Check It Out Kentucky!, V.I.E.W., and Kentucky's Open Door:
| State Database | Searchability | Grants | Contracts | Line Item Expenditures | Dept/Agency Budgets | Public Employee Salary |
|---|---|---|---|---|---|---|
| Check It Out Kentucky! |  | n/a | | |  | |
| V.I.E.W. | | | | | | |
| Kentucky's Open Door | | | | | | |
[edit] Limitations and Suggestions
The individuals who developed www.opendoor.ky.gov realize it's not perfect yet, and they welcome suggestions for improvements. According to the site, "Governor Beshear realizes that Kentucky’s Open Door will not be complete. Nor will it ever be. The site will be ever-evolving and ever-improving; it will be a continuing goal to refine and supplement the site, providing more and more information to Kentucky taxpayers in an easy-to-access format. And we treasure YOUR input."[20]
Suggestions for improvement can be posted under this section, or submitted here.
[edit] Support for creation of the databases
National Taxpayers Union urged Kentucky legislators to pass House Bill 105.[21]
Americans for Tax Reform urged legislators to adopt greater levels of transparency.[22]
[edit] Independent transparency sites
Visit www.freedomkentucky.org to see an "open, collaborative database of information that seeks to inform Kentucky's citizenry about issues that are important to them. Through making knowledge accessible and easily understood, FreedomKentucky empowers Kentuckians to restore lost freedoms by holding public leaders accountable."[23]
[edit] Public employee salary information
Kentucky's Open Door now provides salary information.
The Louisville Courier-Journal provides state employee salary information here.
The Herald Leader provides this database of salaries of state employees, Lexington-Fayette Urban County Government, and the University of Kentucky for the year 2006: Kentucky State Salary Database.
[edit] See Also
Kentucky taxpayer-funded lobbying
[edit] External links
- Kentucky Budget Process on FreedomKentucky.org
- Kentucky's Open Door
- Bluegrass Institute for Public Policy Solutions
- Check It Out Kentucky!, official website
- V.I.E.W. (Vendor Income and Expense Watch), official website
- Kentucky Secretary of State website
- Office of State Budget Director
- Kentucky Finance and Administration Cabinet, Office of the Controller
- Kentucky Government spending
- Model transparency legislation from the American Legislative Exchange Council is available at this link.
[edit] Additional Reading
- Stateline.org,"Kentucky State of the Commonwealth Address 2009," February 4,2009
- Associated Press,"Bourbon spills to protest Ky. tax hike on booze," February 10,2009
[edit] References
- ↑ National Conference of State Legislatures, "Fiscal Year 2010 Budget Status," October 13, 2009
- ↑ Gov. Beshear Blog Post, "Balancing our Books, Planning for the Future," July 21, 2009
- ↑ Kentucky Legislature Web site, retrieved October 26, 2009
- ↑ Courier-Journal, "State revenues plunge in first quarter," October 9, 2009
- ↑ Office of State Budget Director, "2008-2010 Budget in Brief," June 11, 2008
- ↑ Office of State Budget Director, "2008-2010 Budget in Brief," June 11, 2008
- ↑ Office of State Budget Director, "2008-2010 Budget in Brief," June 11, 2008
- ↑ Kentucky's Open Door,"How the budget is made," retrieved February 24, 2009
- ↑ 9.00 9.01 9.02 9.03 9.04 9.05 9.06 9.07 9.08 9.09 9.10 9.11 9.12 9.13 9.14 9.15 9.16 9.17 9.18 9.19 ,"Kentucky state and local spending," retrieved February 24,2009
- ↑ Institute for Truth in Accounting, “The Truth About Balanced Budgets—A Fifty State Study,” Page 35
- ↑ Kentucky Finance and Administration Web site, retrieved October 26, 2009
- ↑ Kentucky Finance and Administration Web site, retrieved October 26, 2009
- ↑ State of Indiana, “State Credit Ratings-as of June 24, 2009"
- ↑ National Taxpayers Union, "A Letter to the Nation's Governors: Ensure Transparency and Accountability by Posting Stimulus Expenditures Online," March 10, 2009
- ↑ Wall Street Journal,"Stimulus Spending by State," March 12,2009
- ↑ e-Transparency Letter from Jonathan Miller, Secretary of Finance and Administration and Chair of the e-Transparency Task Force
- ↑ e-Transparency Task Force Information
- ↑ Kentucky Executive Order, "Creation of the e-Transparency Task Force," June 6, 2008
- ↑ V.I.E.W. (Vendor Income and Expense Watch) official website
- ↑ www.opendoor.ky.gov About
- ↑ "An Open Letter to the Kentucky House of Representatives: Taxpayers Support Spending Transparency Web Site (HB 105)," March 2007, 2008
- ↑ Americans for Tax Reform, "Letter to Kentucky State Legislators," March 7, 2008
- ↑ www.freedomkentucky.org home page
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