With record speed, lawmakers passed a budget plan out of the House a mere 12 days into the session. House Bill 1 prioritizes spending on education and workforce and includes a pay raise for all state employees – priorities for both caucuses which garnered bi-partisan support and allowed the bill to pass 85-8.

After years of historically lean budgets, the House Majority was in the advantageous position of crafting the state’s biennium spending plan with a record-setting revenue surplus of $1.9 billion and $1 billion in federal American Rescue Plan Act (ARPA) funding. Many of GLI’s priorities received funding, including:

Education:

• Major investments for K-12 and post-secondary education, including an increase for the base SEEK funding with an additional $80 million in the first year and $160 million in the second year of the two-year budget.
• Funding for the state to cover the cost of all-day kindergarten for the next two years, as well as increased funding for school districts to cover transportation costs.

Workforce:

• In response to the state’s growing workforce crisis, a healthcare workforce program will be rolled out at a cost of $20 million a year
• Workforce Participation Trust Fund will become available to all KCTCS institutions throughout the state.
• Six percent pay raise for all state employees and additional salary increases for social workers and state law enforcement.

Other items:

• Citing fiscal responsibility and sustainability in this budget plan, House Appropriations & Revenue Chairman Petrie noted $312 million from federal ARPA funding will be used to restore the Unemployment Insurance trust fund to pre-pandemic levels.
• House Bill 241 was also passed by the House to work in tandem with the budget bill to outline a transportation-specific spending plan. This legislation includes $100 million for local governments to road repair and maintenance and $200 million to match federal infrastructure grants.

While HB 1’s emphasis on education, workforce and economic development, and pay raises for state government are similar to priorities in Governor Beshear’s proposal released last week, the House plan did not allocate as much funding as the governor’s $2 billion proposal. Chairman Petrie noted that the House budget plan leaves $1.142 billion unallocated and that the General Assembly needs to determine the best way to spend these taxpayer dollars, hinting at the possibility of a tax cut.

As indicated by leadership, the Republican majority fast-tracked the passage of this bill and is likely to shift the focus of the House to tax reform in the coming weeks. Now the bill heads to the Senate for review and, almost certainly, significant changes before lawmakers from both chambers work on the bills in conference committee.

While many of GLI’s budget priorities were included, we are continuing to advocate for the inclusion of additional funding for child care centers and providers to help address underlying causes of our region’s ongoing workforce shortage.