Veto protects agriculture, early childhood education and health from significant budget cuts
FRANKFORT, Ky. (April 7, 2015) — Gov. Steve Beshear on Monday issued line item vetoes for House Bill 510, citing the need to protect strapped state programs from deep cuts late in the budget year.
The veto is necessary because the commonwealth was notified after HB510 passed that the 2015 Master Settlement Agreement (MSA) payment will be lower than previously expected. The MSA supports agriculture, health and early childhood programs in the state.
Other provisions of HB510 which remain unaffected by the Governor’s veto include fully funding the SEEK formula for K-12 education, helping county and municipal governments continue road maintenance and repairs, and shoring up the Budget Reserve Trust Fund.
“The General Assembly’s intent in HB510 was to protect our programs supporting agriculture, health and early childhood,” Beshear said. “But the late changes to our expected MSA funds made the language in the existing bill problematic. Because the session is over, we can’t go back to amend the bill.”
When HB510 was passed, legislators anticipated an MSA revenue shortfall of $26.6 million, and the bill provided budgetary relief to those programs. The bill also required that if the shortfall were larger, the difference would be resolved by budget cuts.
Since HB510 passed, the state learned that the MSA revenue shortfall may be about $37.8 million—approximately $11 million more than anticipated in HB510. The MSA revenues are received by all states later in April, so the exact amount of the shortfall could not be determined before executive action was required on the bill. The vetoes are based on the most current information available before the expiration of the governor’s constitutional deadline to act.