By Sasha Williams

Kentucky Governor Ernie Fletcher ended his first full fiscal year, 2004-2005, with a big announcement. The governor’s good news on July 27 was that Kentucky’s budget has a surplus of $214 million dollars. There are multiple reasons for the surplus, including the growth of sales and income tax. Sales tax receipts went up 6 percent, individual income taxes went up 8.6 percent and corporation income taxes increased 57.8 percent. Fletcher credits $67 million of the savings to his administration’s conservative spending.

The budget legislation has listed five areas eligible to receive part of the surplus funds. The candidates are the Budget Reserve Fund, Medicaid, necessary government expenses, increasing salaries for certified teachers and additional funding to public education. Kentucky universities will not receive any of the money.

“Because the enacted budget increased university budgets beyond the levels of the fiscal year enacted, universities are not eligible for surplus funds,” stated Carla Blanton, the communication director for the Governor’s Office.

However, the University of Louisville has received funding cuts for four consecutive years, according to Susan Ingram, director of Budget and Finances for U of L. The cumulative loss of funds, considering both permanent and temporary cuts over the last four years, totals $39 million dollars. Part of the surplus will go to restoring those funds that were permanently cut, but the temporary cuts will not be restored. “It didn’t make up for the difference,” Ingram said. “We are significantly behind our benchmark schools.”

In fact, U of L President Dr. James Ramsey told the faculty senate at their Sept. 7 meeting that the university is currently $37 million under their benchmark schools midpoint for funding.

However, Blanton said that some progress has been made through the biennial budget that was passed this spring. “There were very important investments made to post-secondary education.”

 

Highlights from the biennial budget

The budget provides a 12 percent increase over fiscal year 2004.

The Postsecondary Education Institutions’ base budgets in FY 2006 increased by $81.6 million, an average of 9 percent per institution.

Student financial aid funding from state funds increased from $167 million in FY 2004 to $195 million in FY 2006, a 17 percent increase.

Capital Projects: $627 million in Total Bond Funds: $397 million in General Fund supported bonds for 26 projects, $230 million in Agency Bonds for 18 projects.