- Special Sections
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Kentucky operates on a two-year budget. Our constitutional responsibility is to make this budget every even-year session, and we are limited to 60 legislative days to get it done. The process begins with the governor presenting a budget. Then the House modifies it (or starts fresh) and sends it to the Senate. The Senate does its change thing, and sends it back to the House. The House (invariably) rejects those changes, and then a “conference committee” is formed to iron out the differences. The job calls for us to reach an agreement before the end of the legislative session.
The governor can review the budget and veto portions of it – or all of it. As with any bill, he/she has 10 days to study and sign it, or to issue any veto. (He doesn’t have to sign it; after 10 days a bill becomes law with or without signature.) The legislature has the opportunity (and the responsibility) to review any vetoes and then override or not. To do this, we need to save one or two days of the session to meet and consider vetoes.
The constitution gives us 60 days in even years, and requires that we end the session by April 15. So we always reserve a 10-day “veto period” prior to that deadline to see what the governor does. Those “veto days” aren’t “legislative days” so they don’t count in the 60-day limitation. We need to save at least one out of the 60 days to meet and consider vetoes, and that day will be April 12. Now, back up 10 days (excluding Sundays) from then and you have our real deadline for budget agreement. This year, it’s Friday at midnight.
As you may recall, the General Assembly sometimes fails to enact a budget prior to the deadline. When that happens, we have to cool off, come back for an Extraordinary (Special) Session and compromise. That usually takes only five days. Of the many problems with this approach, one is that the legislative branch surrenders the veto override opportunity in a Special Session. The Governor can strike portions without fear of review, except by the public. This has occurred twice in the last decade.
The good news is that the House and Senate are not far apart on the budget particulars this year. That happens when there isn’t much money to argue about. The main differences in the two versions of the budget involve restrictions on debt restructuring and authorized bonded indebtedness.
For example, the governor’s proposal authorized additional bonded indebtedness of nearly $1 billion. The House lowered that to $553 million; the Senate reduced it further to $391 million. The resulting debt ratio, whichever version is accepted, helps determine the state’s bond rating, which affects the interest rate we are charged on the bonded indebtedness. It’s important to keep that interest rate as low as possible.
I’ll write more about this next week; hopefully, I’ll be able to report that a final version was passed by both chambers. Meantime, you can follow proceedings in the news, or check in at the legislative website, www.lrc.ky.gov .
The best part of my job is hearing from you. Call me at home, or leave a message at 1-800-372-7181. This Saturday’s “Coffee with Dave” starts at 10 a.m. at McDonald’s in Mt. Washington. Hope to see you there.