Bevin’s proposed budget cuts for current fiscal year would be illegal, Beshear says

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By Tom Latek
Kentucky Today

Spending cuts being considered by Republican Gov. Matt Bevin’s administration would be illegal, his Democratic political nemesis has claimed.

Attorney General Andy Beshear told reporters at a Capitol press conference Tuesday that two statutes and a recent Kentucky Supreme Court decision bar Bevin from forcing the state agencies to make the cuts.

“One part of his plan may be premature,” Beshear said. “The other part is flatly prohibited under Kentucky law.”

Andy Beshear

Amanda Stamper, the communications director for Bevin’s office, said in a statement that “Beshear’s latest threat to file yet another lawsuit against the governor is premature and entirely political.”

Last Friday, State Budget Director John Chilton sent a letter to state agencies, warning them of a projected $200 million budget shortfall in the fiscal year that began July 1 and a desire to replenish $150 million to the state’s Rainy Day Fund, which he said would be depleted this year.

The letter requested state agencies to submit a budget reduction plan of 17.4 percent by Sept. 25. The only exemptions in the spending cuts were to be public schools, the Medicaid program, the Department of Corrections, and debt reduction.
Beshear said he sent letters to Bevin and Chilton referencing state law that no budget reduction action will be taken until there is either an actual or projected revenue shortfall.

An actual shortfall only occurs at the end of a fiscal year and a projected shortfall can only occur after the Consensus Forecasting Group makes an official estimate, which won’t happen until its December meeting, Beshear said.

The prohibition, he said, is two parts of state law, both of which say no budget reduction action will be taken in excess of the actual or projected shortfall. That would not allow the replenishing of the Rainy Day Fund, he said.

“If those two statutes aren’t clear enough, the Kentucky Supreme Court last year in Beshear v. Bevin said two things: That budget reductions were only allowed under a budget reduction plan and are limited to the amount of the revenue shortfall.”

In the four-page letter sent to Bevin and Chilton, Beshear requested they send a follow-up letter to the state agencies affected by Sept. 15, since they asked for a budget reduction plan by Sept. 25.

“Planning is fine, advance warning is good policy, a heads-up for what is coming down the road is certainly appreciated,” Beshear said. “But budget reductions require an official revenue estimate.”

Bevin and Beshear have battled over many legal issues since taking office. But Beshear said the letter was “a statement of law” and not his opinion, fiscal policy or “any attempt to attack you. We must all follow the law.”

Stamper countered Beshear’s claims of the spending cuts being illegal.

“Director Chilton’s letter merely asked state agencies to draft a similar spending plan before any final decisions are made later in the year. Kentucky law clearly allows the Governor to ask any agency to reduce its spending and the Kentucky Supreme Court said just last year that the Governor can direct spending reductions for agencies under his control.”

Stamper added that “AG Beshear’s grandstanding is not only fiscally irresponsible and nonsensical, but it is also contrary to the law.”

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