Top of mind for many remains the budget, which Democratic Gov. Andy Beshear has described as “the moral document” that will lay out all of the state’s spending for the next two fiscal years.
While Beshear and some advocacy groups have called for large-scale spending increases, Republican House Speaker David Osborne said he expects the budget will remain austere, emphasizing that it will focus on “needs not wants.”
“I expect it to be built largely like we built the last several budgets,” Osborne said, “Which is to find places where we feel like we can invest people's money wisely, but also remain [with a] very fiscally responsible and balanced budget.”
Osborne said the budget will likely be filed in the next week or two, and declined to say where they would incorporate elements of Beshear’s budget.
Ahead of this session, the legislature ended the practice of pre-filing bills — meaning journalists and the public received access to few bill drafts ahead of the session.
Lawmakers also declined to change procedural rules this year after the League of Women Voters released a report that showed bills have been increasingly fast-tracked over the past two decades — decreasing transparency and civilian participation.
Osborne and his Senate counterpart, Republican Senate President Robert Stivers, also laid out a few of the other top issues they intend to address this year, heavily emphasizing education, energy, public safety and healthcare.
An education focus
One of the anticipated education bills and one of the first few assigned to a committee — which generally means it will move quickly — is Senate Bill 6, which stands in opposition to mandatory diversity, equity and inclusion training and professional statements in higher education.
Rep. James Tipton, the Republican from Taylorsville who chairs the House’s education committee, said before the session began that DEI in higher education would likely be a predominant culture-war issue this year.
“There's a lot of concern that schools are spending so much focus on [DEI], that they're really missing the ball on providing the services and the education that they need to,” Tipton said.
Stivers said this week the proposed anti-DEI measure is “still up for debate” and said the legislature should be “measured” in how it attempts to regulate DEI efforts.
The Senate president and Osborne continued to express interest in exerting state control over Jefferson County Public Schools, Kentucky’s largest district, although they stopped short of describing exactly what that might look like.
“There needs to be some serious discussion as to what happens to JCPS,” Stivers said. “Throw a few other things in there like the bloated hierarchy, all the pay that's in the central office — [the list of problems] just kind of goes on and on and on.”
While Stivers and Osborne said Kentuckians would likely see new investments in education and workforce development, they were also clear that there is little appetite for the level of funding to which Beshear aspires — an 11% raise for school staff and teachers and universal pre-K.
While Osborne said he doesn’t see the legislature venturing outside their existing funding formula, called SEEK, to provide raises, Stivers said he didn’t consider it totally out of the question. The legislature has shown a reluctance to allocate money outside of SEEK, which would give money to districts to decide whether to then issue universal raises.
“It's not crazy. It's not out of bounds. I think the bigger question becomes how you do something, whether it is appropriate to run it through the SEEK allotments or, as the governor is doing, outside the SEEK formula,” Stivers said.
Future tax cuts
Since the General Assembly passed its 2019 tax reform bill that laid out a framework to incrementally lower the state’s income tax to zero, the size of Kentucky’s budget and rainy day fund took on new meaning.
Under that framework, if Kentucky’s revenues stay high enough in comparison to its budget, and the budget trust fund remains robust, then a near-automatic 0.5% income tax reduction is triggered. One of those conditions, however, was not met this year.
Nonetheless, Stivers said reducing taxes remains a priority for them.
“We want to make sure we focus on reducing the tax burden to the Kentuckians that we hear, see and know are working,” Stivers said.
Osborne, however, said he does not intend to pass a budget solely to meet those triggers.
“Our goal is to make the best, most fiscally sound budget that we can,” Osborne said. “We certainly did not budget to miss the tax cut this time. We certainly will not specifically budget to hit one next time.”
Other top priorities
Stivers also said he expects more legislation around energy, reiterating his unflagging support for coal-fired power.
He blamed, in part, federal disincentives and environmental, social governance (ESG) investment strategies for recent power failures in the country. But Stivers stopped short of announcing any direct policy initiatives.
“Energy is critical and why we have become one of the utmost places to locate because of cheap energy costs,” Stivers said. “We are on a teetering point, and we have to be very careful.”
Osborne said he also intends to emphasize public safety and maternal health in the upcoming session. He pointed to Rep. Jared Bauman’s Safer Kentucky Act and Rep. Kim Moser’s Momnibus bill as legislation to watch.
Stivers and Osborne did identify a couple areas of bipartisan agreement. The parties typically agree with more expenditures to aid the thousands of Kentuckians who lost homes and loved ones in natural disasters — the nature of that assistance may differ between the governor and Republican lawmakers.
“We know that water and sewer, especially more so in rural areas, needs to be done. Broadband, roads construction, good infrastructure from that perspective — those things I think we need and we can all agree on,” Stivers said.
But, Stivers noted, the question becomes how much money gets allocated for infrastructure and assistance.
Some legislation already moving
It’s only the first week and lawmakers have filed their opening salvo of legislation. So far, they’ve introduced nearly 200 bills in the House and Senate.
One bill has already moved its way through committee and completed its second hearing in the Senate. The bill changes regulations around fishing and hunting licenses, allowing people with small properties to also hunt on their land without a license.
The House too has pushed through one piece of legislation for its second reading, before going through committee — a rule that would make sure candidates filing for office aren’t disqualified over a specific clerical error.
Several bills have also been assigned to committees in the Senate. Those include the DEI restrictions in higher education bill, a consumer data privacy protection act, and a proposed constitutional amendment to change the year of Kentucky’s gubernatorial (and other constitutional offices) to a national election year.
