Budget negotiations in Frankfort collapsed Wednesday amid enormous differences over a sliver of the spending plan that would create a spate of state-backed construction projects while adding to the Commonwealth’s debt.

The sudden breakdown came after weeklong talks over the $17 billion-plus, two-year budget.

It raised the prospect of lawmakers waiting until the last day of the 60-day session in mid-April to pass a budget, or possibly leaving without one. Lawmakers had hoped to pass the budget Friday before taking a break to allow the Governor’s Office to review bills.

Substantial power is granted to the governor of Kentucky.  Historically, the Office of Governor of the Commonwealth of Kentucky has been regarded as one of the most powerful executive positions in the United States of America. The Governor of Kentucky is the head of the executive branch, commander-in-chief of the Kentucky’s army, navy, and state militia forces.  The governor also holds veto power over the Kentucky Legislature, and appoints Cabinet Secretaries without Senate confirmation.

The Governor was granted additional powers the last time the Kentucky Legislature ended its session without a budget, it led to a Kentucky Supreme Court ruling that a governor can spend money in the absence of a budget, but is limited to do so for items directly mentioned in Kentucky Revised Statues, Kentucky Administrative Regulations, or the Kentucky Constitution.

Top legislative leaders said they still hoped to achieve a budget deal, with each blaming the other chamber for the impasse. “I hope we can leave here with a budget,” Senate President David Williams said.

House Speaker Greg Stumbo declared that House members were willing to work “up until the last minute of the last day of this session” to get a budget accord.

Sticking points included education funding and a House-passed revenue package, but the main flash point appeared to be the construction projects backed by House Democrats. Senate President Williams (R-Burkesville), said Senate negotiators balked at the House-passed construction program that would result in the state borrowing about $1.2 billion to finance the work. The bulk of the bonded projects would replace dilapidated schools.

Speaker Stumbo (D-Prestonsburg), who was the Commonwealth’s previous Attorney General, has championed the construction projects as a way to jump-start the Kentucky’s economy. He said the proposal to build new schools along with water and sewer projects would put an estimated 25,000 Kentuckians back to work amid stubbornly high unemployment.

“It’s our position that we need to be creating jobs in these recessionary times,” Stumbo told reporters.

At his own news conference, President Williams warned that the construction program would “put our state into a debt-death spiral” in uncertain economic times.

President Williams said the House divvied up school projects to reward loyal House members, and said House Democrats were mistakenly trying to spend and borrow the state into prosperity.   “It is our position that in austere times people expect shared sacrifice,” Williams said.  “And that we have to keep our debt levels down and make sure that folks in the private sector see government sacrificing the way they have to sacrifice every day.”

Both legislative leaders acknowledged that the Kentucky House and Senate would draw considerable fury from the people of Kentucky if the session ends without a budget.

Lawmakers have three working days left in the 60-day session. If they wait until April 15th to pass a budget, they would not be able to consider overriding any possible veto’s the Governor issues to the budget.

Governor Steve Beshear said Wednesday that the legislature’s top job is to pass a balanced and responsible budget, and noted that it has until April 15th to do so. “The taxpayers and I both fully expect the General Assembly to work as many hours as it takes to meet that responsibility by that date,” Governor Beshear said in a statement.

The Senate passed a $17.3 billion two-year budget that called for deeper spending cuts to almost all state agencies than the House’s $17.5 billion version.  Speaker Stumbo said House members objected to the Senate’s cuts in education, but said negotiators had appeared to be closing in on resolving that issue.

Led by Kentucky Equality Federation, the Kentucky HIV/AIDS Advocacy Group, and AVOL (AIDS Volunteers Inc.), organizations across the Commonwealth have expressed alarm and dismay that the budget will be passed that does not include funding for the Kentucky AIDS Drug Assistance Program (KADAP).

The other organizations include the Kentucky HIV/AIDS Planning and Advisory Council, COLAGE (Children Of Lesbians And Gays Everywhere), the Wings Clinic, the House of Ruth, Moveable Feast, GLSO (Lexington Gay Lesbian Service Organization), University of Kentucky OUTsource, and the University of Kentucky Gay-Straight Alliance.

The organizations stated non-profits do not have the resources to provide a safety net for the Commonwealth’s shortfall in funding.   KADAP is currently unfunded even though it has 1,300 patients enrolled, with an additional 190 men and women being placed on a “waiting list” to receive life saving medications.  More and more names are added to the waiting list daily.

Kentucky Equality Federation’s Board of Directors slammed the Kentucky House of Representatives for failing to add a mere $3.5 million to an already ‘overburdened‘ budget to fund the Kentucky AIDS Drug Assistance Program.

If lawmakers fail to pass a budget, Governor Beshear could convene a special legislative session to deal with the spending plan.  The lack of a new budget by the start of the next fiscal year on July 1st could turn off the taps of funding for some services.   “There will be parks closed, there will be some services that will be suspended,” Speaker Stumbo warned.  “There will be in many areas of state government a visible stopping of the programs and the services that the Commonwealth provides.”