Sunday, December 12, 1999
Tight state budget may limit N.Ky. projects
BY PATRICK CROWLEY
The Cincinnati Enquirer
FORT MITCHELL — A tight state budget may make it difficult for Northern Kentucky lawmakers to deliver a big-dollar project from the 2000 General Assembly session.
Over the last four years, members of the legislative caucus have successfully brought home expensive capital projects like the Northern Kentucky Convention Center ($40 million), the Northern Kentucky University Science Center ($38 million) and the regional juvenile detention center in Newport ($4.5 million.)
Added to those are millions of dollars more for parks, water lines and road projects.
In the upcoming session, however, money will be harder to come by.
“There's no question the budget is going to be tighter than in past years,” said House Majority Caucus Chairman Jim Callahan, D-Wilder, a member of the House Budget Committee.
“And we're not going to have anything close to the $400 million surplus we had two years ago. As far as money goes, what we're hearing right now is not very encouraging,” he said.
Not only will there not be a surplus, but state Budget Director James Ramsey is forecasting a $74 million deficit for the fiscal year that ends June 30, 2000.
“It's not going to be a dis aster, but it's going to be tight,” Gov. Paul Patton told the Louisville Courier-Journal last month. “We're going to re-analyze every expenditure to see how it can be trimmed without really affecting services, and then we've got to add it up and see where it's at.”
While the move from a $400 million budget surplus to a projected $74 million deficit may seem like a radical shift in finances, such a situation seemed bound to happen.
With the state economy booming the last several years, the legislature cut $350 million in taxes while spending the cash that had built up in surpluses.
Now, the economy has begun to slow, and Frankfort is seeing the effect of spending instead of saving the surplus.
It appears doubtful that any region will receive as much money in the upcoming session. But Northern Kentucky is still prepared to lobby for all the cash it can from a long list of projects and requests.
Among them:
• $10 million for a community and technical college building, a project strongly supported by NKU.
• $8 million to turn the L&N Bridge into a pedestrian walkway to join Kentucky with riverfront amenities on the Ohio side.
• A $700,000 study to examine how to renovate the former NKU science building that will be vacant when the new building is finished in 2002.
• A $125,000 comprehensive market and engineering study on the feasibility of a “personal rapid transit system” over the Ohio River called Sky Loop.
“We realize the budget is tight,” said ULH&P Co. Manager Gary Bricking, chairman of the Northern Kentucky Consensus Committee, a group of area government, business and community leaders that pushes funding for local projects.
“However, I think we are always ready to promote what we feel are great projects for the Northern Kentucky area, which in my mind helps the whole state because of our strong economy.”
Northern Kentucky deserves money because it sends more tax dollars to Frankfort than it gets back, said state Sen. Dick Roeding, R-Lakeside Park.
“We are only getting back 30 to 50 cents of every dollar we send to the state,” he said. “We ought to have some of our projects funded because we are generating money that is being spent elsewhere in Kentucky.”
The legislature, however, appears poised to take another $70 million to $80 million out of the revenue stream. A bill is expected to pass that would eliminate the state's 30 percent take of the vehicle tax paid when Kentucky residents annually renew their license tags.
“That's a good bill and I'll support it,” said Rep. Royce Adams, D-Dry Ridge, also a member of the House budget committee.
“But it's going to mean a lot less money to spend. That's just the reality of the situation.”
There are opportunities for additional money coming into the state.
To pump a road fund that is facing a $600 million shortfall, Mr. Patton has proposed raising the state's gas tax by 6 to 7 cents a gallon.
But lawmakers aren't eager to raise taxes and have given the proposal a cool reception.
The federal tobacco settlement will mean $140 million a year to Kentucky but there are lot of people and groups in line for that money, including farmers, agriculture advocates and lawmakers, who want the money spent on health care.
Some lawmakers are saying privately that Mr. Patton may use the state's financial position to push for legalizing casino gambling in Kentucky. He has said doing so could generate millions in new revenue.
But again, the legislature has not warmed to the idea of allowing casino gambling in the state.
Mr. Adams said the state can borrow money by selling bonds to pay for some projects.
“But any way you look at this budget and start to cut it up,” Mr. Adams said, “there's not going to be enough to go around. Of course there never is, but this budget is going to be particularly tough to deal with.”
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