KCTCS Position

Governor Bevin’s Proposed State Budget, 2016-18

THE STATE BUDGET BILL – HB303

The Governor’s budget proposal as outlined during his State of the Commonwealth and Budget address to the Kentucky General Assembly on Tuesday, January 26, 2016 is contained in HB303, which was introduced by Rep. Rick Rand, Chairman of the House Appropriations & Revenue Committee. Read State Budget Bill — HB303.

PROPOSED 2016-18 STATE BUDGET FOR KCTCS

Operating Budget Request: The Kentucky Council on Postsecondary Education budget request for all postsecondary education institutions was to restore one-half of the state appropriation cuts since 2008. The Governor’s proposal further reduces postsecondary education funding by 9% over the current year base appropriation. Here’s what the proposed budget reductions mean for KCTCS:

Current KCTCS State Appropriation in FY16

$190,162,300

9% Reduction from FY16 Base Appropriation = $17,114,600

4.5% Budget Reduction ordered by Governor IN FY16

$8,557,300

Revised KCTCS State Appropriation in FY16

$181,605,000

Proposed 4.5% Budget Reduction in HB303 for FY 17

$8,557,300

Revised KCTCS State Appropriation in FY17

$173,047,700

PROPOSED PERFORMANCE FUNDING

Will be earned based on Performance Metrics TBD

Proposed 1/3 Reallocation of KCTCS FY17 Base Appropriation

$57,624,900

Revised KCTCS State Appropriation in FY18

$115,422,800

NOTE: Looking ahead to the next biennia, Governor Bevin proposes a 2/3 reallocation of the KCTCS base state appropriation to a new Postsecondary Education Performance Fund in FY19 and 100% of KCTCS base state appropriation in FY20.  This formula will be the same for all public postsecondary education institutions.

Capital Budget Request: There are no state funded capital projects proposed by Governor Bevin for KCTCS or any of the other eight postsecondary education institutions. Instead, the Governor’s budget proposes a bond pool of $100 million dollars for the Education and Workforce Development Cabinet in order to co‐invest with those local communities that are experiencing growth demand for high‐skill jobs, including advanced manufacturing and information technology jobs.

Below is the exact language in HB303:

The Workforce Development Construction Pool is a $100 million resource to finance, in whole or in part, capital investments in workforce development education and training facilities. The Education and Workforce Development Cabinet will administer this Construction Pool and will provide a neutral, objective process whereby appropriate project applications will be received, reviewed, and awarded. This Construction pool addresses employers’ needs to recruit a workforce that will align with changing demands and work environment, and the Commonwealth’s needs for a highly skilled workforce and to carry out a strategic goal of achieving excellence in manufacturing and related industries.

NOTES:
1) Contrary to what was reported in the media, this fund DOES NOT offset the proposed reduction in the KCTCS operating budget. Also, it appears that this funding pool will be available to the universities to seek approval for capital projects that meet these criteria; making it uncertain how many KCTCS projects could possibly be funded from this pool.
2) The Governor’s proposed budget authorizes KCTCS to use its own restricted funds for renovation and/or construction projects that do not exceed $5 million each. UK and UL were granted similar authority for projects up to $15 million each.

Trust Fund Request: The Governor’s proposed budget does not contain any of the trust funds requested by CPE, which included the $5 million Workforce Development Trust Fund for KCTCS to attract and match private-sector endowment gifts.

Download the full state budget proposal.