Governor Beshear delivered his biennial budget recommendation Tuesday night.
Some highlights of the Governor’s proposed budget:
- There is a 1% increase in base funding to postsecondary institutions. For NKU, that would be an increase of $523,000. These funds go directly to our base budget, not to the Performance Fund.
- Our recommended asset preservation funding is included by authorizing $200 million in state bonds to be matched $0.50 on the dollar by each institution. This would mean state funding of $21.4 million with a match by NKU of $10.7 million to maintain and restore needed infrastructure projects across campus.
- The Governor also funded pension relief in the amount of $18.7 million for institutions selecting House Bill 1’s option to keep all employees in the Kentucky Employees Retirement System (KERS). Further, the Governor has recommended capping the employer contribution rate at 67.41% instead of increasing to 93.01% as suggested by KERS. For NKU, this would appropriate an additional $5.9 million if we elect to stay in the system to offset the rate increase to 67.41%. NKU’s current contribution rate is at 49.47%. To recap HB1’s pension reform options, click here.
With funding increases for postsecondary education and other government agencies, the Governor has balanced his budget by increasing revenue in the following areas:
- Raising the cigarette tax by 10 cents;
- Raising the tax on chewing tobacco products;
- Taxing vaping products; Increasing the limited liability entity tax (LLET); and
- Enacting sports wagering legislation.
The budget now goes to the Kentucky General Assembly, where the House of Representatives and Senate deliberate on it. The legislature and Governor have until April 15 to finalize the budget. For an in-depth look at Gov. Beshear’s budget, the Louisville Courier Journal’s overview article and Lexington Herald Leader’s story on the pension implications provide more details.
As additional information comes available during the legislation session, I will share it with you. Thank you for all you do for our university, our students and our region.