TONY MCVEIGH: I'm Tony McVeigh in Frankfurt, Kentucky. Kentucky's financial problems pale in comparison to those in California and New York. But the Commonwealth does have its own budget woes. Since taking office in December 2007, Governor Steve Beshear has trimmed state spending six times to the tune of almost a billion dollars. And with the state still facing a huge deficit this fiscal year, Beshear just ordered most state agencies to trim spending by another three percent. The governor's now busy crafting a new two-year budget plan.
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U: The chair now calls to order this first joint session of the 2010 General Assembly of the Commonwealth of Kentucky.
MCVEIGH: In last night's State of the Commonwealth Address, Governor Beshear warned of more deficits ahead, possibly reaching $1.6 billion.
MCVEIGH: We're facing a huge deficit that will require us to make painful decisions about where we spend money. It will require sacrifice and restraint, but folks, this challenge can be overcome.
MCVEIGH: Last year, lawmakers raised taxes on cigarettes and alcohol. But this is an election year in Kentucky, and Governor Beshear says he won't pursue further tax hikes, especially in a recession. But the governor says the state can't stay stagnant.
MCVEIGH: I refuse to use this recession as an excuse not to move forward. I refuse to hunker down and hide, to just wait out this storm, to passively accept the economic situation that others have created for us.
MCVEIGH: And Beshear says Kentucky's not alone. Many other states are in far worse shape.
MCVEIGH: Many have undertaken radical solutions involving cuts to core priorities, mass layoffs, broad-base tax increases. But because of fiscal restraint and strategic thinking in the early days of this recession by all of us, Kentucky is in better condition. But our work has only begun.
MCVEIGH: But the Democratic governor's remarks drew a tepid response from Senate President David Williams. The Republican leader says Beshear still hasn't done enough to cut state spending.
S: If his budget deficit or shortfall is really $1.6 billion as he proposes to be, he's going to have to get very serious about proposing additional cuts in the budget and get into the base. I haven't seen that yet up to this juncture.
MCVEIGH: For NPR News, I'm Tony McVeigh in Frankfurt, Kentucky.
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