Taxing and Spending, Kentucky-Style
Policy is adopted in Kentucky, as everywhere else, in many ways. There is no more effective method of influencing and changing the direction of a government than making decisions to raise and spend money. "Since the budget is the principal instrument of resource allocation and policy planning, it reflects state government's public policy priorities."1 Each decision to appropriate or not appropriate a dollar (that is, each "line item" in the state budget) represents a judgment about Kentucky's goals. To the extent that conflicts are resolved by expenditures, or a decision not to spend, the state's budget is a guide to policy choices.
As in other states, numerous factors reduce the amount of discretion left to decision makers--the prohibition of deficit spending, earmarking, restricted federal funds, court consent decrees, federal mandates, limited time and knowledge, and past commitments to interest payments and retirement programs.2 Moreover, all states are at the mercy of economic ups and downs, and this has increasingly played havoc with budgeting in Kentucky.
The 1990 legislature reflected all these factors when it designated its 1990-92 General Fund Appropriations to include 48.3 percent for elementary and secondary education, 15.6 percent for higher education, 17.0 percent for human resources, 3.9 percent for corrections, 2.6 percent for the judiciary and the legislature, and 12.2 percent for all other Cabinets. The same budget reflected change in Kentucky: corrections and Medicaid (a part of the human resources' allocations), for example, were the biggest growth areas--as a result of more mandatory sentencing rules and the requirements imposed on the state by the federal government.3
Kentucky state government spent $1,830 per state resident in 1989-90, slightly less than the average state, which spent $1,884.4 The state's spend-