Kentucky Says It Needs More Federal Aid To Survive Effects Of COVID-19
Monday, August 3, 2020
This story is part of an NPR nationwide analysis of states' revenue and budgets during the pandemic.
Kentucky Gov. Andy Beshear, a Democrat, says the state risks a $1.1 billion shortfall out of its roughly $11 billion budget over the next year if the state doesn't get more federal assistance during the coronavirus pandemic.
"What we're looking at right now without extra assistance is one of the most difficult years in budget balancing that we have seen," Beshear said. "This would be like letting Kentucky go bankrupt."
Though Beshear's administration initially braced for a $500 million shortfall in the fiscal year that ended on June 30 due to a drop in income tax and sales tax revenue during the pandemic, the state ended up with a $177.5 million surplus.
Beshear said the surplus was because of his administration preemptively cutting most state government spending by 1% late last year, as well as tax receipts not dipping as much as expected.
But without more assistance from Congress, Beshear said, the state would have to consider cuts to the current year's state budget ranging from 16% to 29%.
The state's public colleges and universities have already taken a hit, announcing in July that they suffered a $145 million blow from coronavirus-related costs and lost revenue — equivalent to about 17% of their annual funding from the legislature.
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