FRANKFORT - Gov. Steve Beshear proposed reshuffling state funds Tuesday night to bolster Kentucky's public schools, recommending a large infusion of money for classrooms gained from another round of budget cuts.
Kentucky's higher education system was among the targets for spending cuts in the $20.3 billion, two-year state General Fund budget that Beshear presented to lawmakers.
The second-term Democratic governor outlined his budget priorities in a speech to a joint session of the Kentucky House and Senate. It marks the starting point for nearly three months of haggling as lawmakers craft a budget for the two years starting July 1.
As promised, Beshear found extra money for Kentucky's elementary and secondary education system by recommending $98.6 million in spending cuts.
"This budget proposal strategically focuses our very limited resources on what I believe will deliver the greatest return: A more highly educated population that will become a more talented workforce," he said.
Beshear proposed an extra $189 million over current funding for the state's main funding formula for K-12 classrooms. The increase would raise per-pupil spending to its highest total ever in Kentucky, he said.
From 2000 to 2008, the funding formula grew an average of 3.4 percent yearly, he said. Since 2008, when the recession hit, funding has been flat, even as the state recovers from the deep economic downturn.
He proposed a pay raise for teachers and other school employees - 2 percent in the first year and 1 percent in the second year. He also proposed spending $36 million over two years to expand preschool services to serve an estimated 5,125 more 4-year-olds.
Beshear recommended that many state agencies, including the governor's office, take a 5 percent budget cut in the first year of the biennium. Those agencies' budgets would remain flat in the second year.
He acknowledged the cuts would cause more damage to a state government that has endured about $1.6 billion in state spending cuts in the past six years as tax collections plunged amid the downturn.
Beshear proposed a 2.5 percent budget cut in the first year of the budget cycle for universities, community and technical colleges and the Kentucky State Police. As a result, colleges and universities face cumulative cuts of 17 percent since the recession if the latest cuts go through, the governor said.
"This was one of the most difficult choices made in this budget, because higher education deserves more support, not less," Beshear said. "But there simply is no way to create enough money to make the needed investments in pre-K through 12th grade unless higher education is included in the reductions."
Meanwhile, the governor recommended authorizing $145.5 million in agency bonds to help finance expansion projects across the Kentucky Community and Technical College System.
He said it represents the single-largest investment in the KCTCS system since its formation. The two-year system has grown to about 100,000 students at its 16 colleges and 73 campuses, he said.