Tight revenue may foil next governor's plans

Candidates vow not to raise taxes

FRANKFORT, Ky. -- The winner of this year's governor's race will have to draft a state budget with little -- if any -- new revenue.

Yet the incumbent, Republican Ernie Fletcher, and his Democratic challenger, former Lt. Gov. Steve Beshear, promise to improve health care and education without raising taxes.

Official projections for revenue growth in the nearly $8.7 billion state General Fund are bleak: 1.1 percent growth this fiscal year, which ends June 30, 2.4 percent in 2008-09 and 3.6 percent for 2009-10.

That's less than the average growth over the past two decades and, in all likelihood, barely enough to keep up with inflation.

An even bigger problem stems from the fact that spending this year is being boosted by more than $300 million in one-time funds, mostly from surpluses accumulated in recent years. That's money that won't be available in the next budget.

"The next governor is going to be challenged," said Rep. Harry Moberly, the Richmond Democrat who is chairman of the House budget committee. Still, Fletcher and Beshear even oppose an increase in the 30-cent-a-pack cigarette tax -- although Kentucky has one of the highest smoking rates in the nation and one of the lowest tax rates.

In fact, each candidate is considering tax cuts...

This from the Courier-Journal.