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Governor's $260 million in cuts hits roads, schools, disabled hardest

TOPEKA – A fifth round of cuts to state agency budgets hit highway maintenance funds and education hard.

Gov. Mark Parkinson, a Democrat, on Monday announced a  fifth set of cuts to the current budget, which began July 1.

Every state agency has had money cut, he said.

At the beginning of the month, the Revenue Estimating Committee released its revised budget numbers, which showed the state needed to cut about $260 million from the state budget. That figure assumed the state would not pay additional money to kindergarten through 12th grade to make up for increased costs from enrollment growth and more students receiving free and reduced lunches.

The cuts fulfill Parkinson’s promise that lawmakers would have a balanced budget when they return to Topeka in January.

Below is the governor’s press release detailing the newest cuts.

Parkinson cuts spending, balances budget

Kansas' schools, roads and the disabled are critically impacted

Governor Mark Parkinson has cut millions in state funding to bring the current budget into balance. Kansas' schools, roads and many of the state's most vulnerable citizens are again impacted by a historic drop in state revenue.

"Unfortunately, we are now to the point of potentially making crippling cuts to state services. This latest round of budget reductions will mean that class sizes will again increase in Kansas schools. Some districts will be forced to lay off teachers and close schools. These cuts mean that our universities will have fewer professors, offer fewer classes and critical investments in our future are in jeopardy. These budget cuts will force us to reduce supervision of released prisoners, increase the number of disabled citizens waiting for services and reduce road maintenance across the state," Parkinson said.

"It is my obligation as a leader to balance the budget. But it is also my duty to protect our most precious resources. So I have once again balanced the budget. I promised that I would and I have kept that promise. But we cannot make it through this recession by cutting ourselves into an incurable position. When the Legislature returns in January, together we must look towards building a solution for the years ahead or we will permanently damage the foundation of our state."

An overview of the Governor's budget reductions and adjustments are as follows:

Budget adjustments: $258.9 million

1. Targeted, strategic budget reductions in individual agencies as outlined on the attached list.

2. Reduce highway maintenance funds by $50 million. This is achieved by transferring $50 million from the State Highway Fund to the State General Fund.

3. Reduce the amount transferred from the State General Fund to the Bioscience Authority by $5 million. This will still allow $35 million to be transferred from the General Fund to the Bioscience Authority.

4. Reduce funding for K-12 by $36 million and Regents by $2 million, leaving both at 2006 spending levels. Do not fund recommended $155.8 million K-12 increase based on revised estimates of property tax revenue and student enrollment.

5. Move unspent funds from prior years from individual agency budgets to the State General Fund. This includes the Governor's Office and the Legislature.

6. Reduce Medicaid reimbursement rates by 10%. This cannot be implemented immediately, so it is estimated it will result in savings of $22 million during the last three months of the fiscal year.

Offset Budget Adjustments with Recovery Act Funds: $85.9 Million

1. Reduce K-12 Supplemental General State Aid by $85.9 million, but offset that reduction with $85.9 million of federal Recovery Act funds that had been budgeted for the 2011 fiscal year. This leaves the state with $189.6 million of Recovery Act funds (State Fiscal Stabilization and Special Education funds) for use in the 2011 budget.

States have discretion over when to draw down these Recovery Act funds. At least 10 states plan to use all of their Fiscal Stabilization Recovery Act funding by the end of FY 2010. A large majority of states plan to use a greater portion of the funding in FY 2010 and a smaller portion in FY 2011.