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Beshear uses line item veto in Medicaid/education dispute

Takes action on bill addressing Medicaid budget shortfall, vetoes Senate's proposed education cuts. Governor wins support of Education, health care groups. Note: Story below contains opinions from the Governor's writers.

By Kerri Richardson, Jill Midkiff
From Governor Steve Beshear's Communications office

FRANKFORT, KY. (2011-03-25) - Governor Steve Beshear today took action on House Bill 1 from the 2011 Special Session, resolving a shortfall in the Medicaid budget and preventing devastating cuts to health care providers. The resolution also ensures that federal money provided to, and in many cases already spent by, local school districts from the Education Jobs Fund will not have to be returned to the federal government.

The Governor line-item vetoed language in the budget bill that would have required cuts to Kentucky's schools, social workers, public safety, veterans programs and other critical services. In addition, in order to retain maximum flexibility in implementing other already required cuts for Fiscal Year 12, Gov. Beshear vetoed language that would limit his ability to ensure cuts are implemented in a way that causes the least amount of harm to Kentucky families.

"Today is a victory for Kentucky's children and Kentucky's future against a State Senate majority that wanted to slash Kentucky's schools," said Gov. Beshear. "This bill, with the necessary vetoes, means we have protected our schools and will not be forced to make cuts to health care providers that would have drastically limited services and led to layoffs across the state. Kentuckians owe a debt of gratitude to the courageous members of the House, who brought this costly session to an end, and I thank them and the Senate Democrats for their commitment to protect Kentucky's families."

Due to a shortfall in the Medicaid budget, Gov. Beshear recommended in November to balance the budget by transferring $166.5 million from the FY2012 Medicaid budget to FY2011, then capturing those savings through expanded managed care programs and other program efficiency measures. Although the House overwhelmingly approved the Governor's approach in a bipartisan manner, the regular legislative session ended without an agreement when the State Senate Majority insisted on addressing the shortfall with cuts to all of state government, including to SEEK, the basic funding formula for Kentucky's classrooms and adjourned when they did not get their way. Facing 35 percent Medicaid reimbursement rate cuts to take effect April 1, Gov. Beshear called the General Assembly back for a special session. Although the Senate Majority once again insisted on cutting education and other state services, Gov. Beshear committed to House members that, if they passed the Senate substitute, he would veto these cuts.

"I appreciate Gov. Beshear's continued commitment to P-12 education," said Education Commissioner Terry Holliday. "We are implementing major reforms that will impact all of the children of the Commonwealth, and we need this level of support to carry out that work."

"Kentucky's institutions of higher learning provide the education and training that helps to mold the future leaders of the Commonwealth and our nation," said Dr. Robert King, president of the Council on Post-Secondary Education. "I am very grateful to Governor Beshear for taking action today that will prevent damaging cuts to our colleges and universities, which could have greatly hindered our ability to increase the future success of Kentucky's students."

"School districts already are absorbing a $49 million SEEK reduction this year and another $28 million next year, both tied to larger-than-expected enrollment," said Tom Blankenship, Lincoln County school board member and President, Kentucky School Boards Association. "Therefore, district leaders strongly support the governor's decision to veto yet another cut in SEEK funds that would hit as they deal with things like rising bus fuel prices and other constraints on the resources they have to support the education of their students."

"As a superintendent in a Kentucky school district, I appreciate the Governor's stance to continue to protect education," said Tim Hanner, superintendent of Kenton County Schools. "If the Commonwealth is going to be poised to attract new businesses and economic growth as we come out of the economic downturn, it is not the time to make cuts to education."

"This once again shows the Governor's commitment to public schools and public schoolchildren of Kentucky," said Sharron Oxendine, President of the Kentucky Education Association, which represents 42,000 Kentucky public school employees, retirees and students preparing to become teachers. "We applaud his efforts and his continued support for Kentucky teachers."

"On behalf of Kentucky's school leaders, we are pleased to hear that cuts to education will be avoided by virtue of Governor Beshear's veto," said Phyllis O'Neal, President of the 3000-member Kentucky Association of School Administrators. "Education funding has been cut repeatedly in the past three years, and we simply will not be able to sustain our educational progress in Kentucky's schools if these cuts continue."

"This Special Session was an unnecessary and wasteful use of the taxpayers' hard-earned dollars," said Gov. Beshear. "While this could have and should have been resolved in the Regular session, I am pleased that, working with the House members and Senate Democrats, we were able to resolve this stalemate without further harm and cost to Kentuckians."

This story was posted on 2011-03-26 07:28:40
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