FRANKFORT, Ky. — Lawmakers may have to return to Frankfort soon to fix the current state budget.

 

What You Need To Know


  • Kentucky's general fund is expected to have a $456.7 million shortfall

  • The state's road fund will see a $161.8 million shortfall

  • Lawmakers may have to meet in a special session

 

Members of the Consensus Forecasting Group, a group in charge of providing official revenue estimates for lawmakers to base their budget decisions on, met Friday and issued a revised outlook for the remaining fiscal year.

The group says Kentucky’s general fund is expected to have a $456.7 million shortfall, four percent of the overall budget, while the state’s road fund will see a $161.8 million shortfall, 10.4 percent of the transportation budget.

"COVID-19 has significantly impacted, and moving forward without federal help, will devastate the budgets of every state and every local government," Gov. Andy Beshear (D) said.

Last month, the governor’s budget office wrote to state agencies, telling them to prepare for immediate budget cuts.

The governor wanted to wait until the Consensus Forecasting Group met to finalize those plans. Beshear said his office is now evaluating those plans.

"We evaluate the amount of harm that would occur to people out there because almost every budget cut does result in a little more difficulty or challenge for folks, and we want to make sure we minimize that," Beshear said.

The governor can reduce the budget as long as the deficit in either the general fund or the road fund doesn’t exceed five percent. The general fund deficit falls below that threshold but the road fund deficit does not, so lawmakers have to be involved.

Beshear hasn’t considered a date yet for a special session, but the fiscal year ends June 30, so there isn’t much time to balance the budget.

"We’ve had initial conversations with [legislative] leadership," Beshear said. "We want to talk to them again, make sure we have it all hammered out, make sure we do it in as short a time as possible."

House Speaker David Osborne said he’s hopeful the special session allows lawmakers to play a role in how the country comes back from the coronavirus.

"While we have not specifically discussed a special session with the Governor, it seems inevitable as we learn more about the impact of the state’s prolonged shutdown," Osborne said. "While we are hopeful that jobs and the economy will bounce back, we must be prepared for what happens if it does not."

Senate Appropriations and Revenue Committee Chairman Chris McDaniel (R-Taylor Mil), said the revenue outlook isn’t surprising.

"We knew the revenue forecast was going to be worse than anything anyone could imagine and that's why we reduced the current year spending," McDaniel said. "We’ll be back in session midway through next year’s budget and, with better forecasts, be able to make the necessary revisions."

Beshear said lawmakers also need to be mindful about possible cuts they will need to make in next year’s budget, but first they have to figure out how to get through the next month.