(Source: Lexington Herald-Leader (Lexington, Ky.))

By Linda Blackford and Beth Musgrave, The Lexington Herald-Leader, Ky.
Nov. 1--When lawmakers return to Frankfort in January, one number will loom large: $1.19 billion.
According to preliminary estimates, that's how much money lawmakers must find in the couch cushions of state government to continue spending at current levels through June 2012.
The state still has $485 million of federal stimulus money to throw at its budget gap, but bridging the remaining $705 million shortfall could create headaches for just about everybody, including students, state workers, the poor and the sick.
Despite the state's money woes, proposals by two lawmakers from different ends of the political spectrum to overhaul Kentucky's tax system won't likely gain approval in the upcoming legislative session.
Rep. Bill Farmer, R-Lexington, and Rep. Jim Wayne, D-Louisville, have re-filed separate and very different plans for systemic tax reform. Although different in most ways, both plans call for extending the state's sales tax to services ranging from manicures to engineering work.
They say their plans would make the tax system more modern and fair, and most importantly, bring in more money.
"Our revenue stream is entirely unsustainable," said Farmer, who filed Bill Request 31 last week. "We have to find something that's going to get our revenue to grow."
However, Gov. Steve Beshear, facing re-election in 2011, said both proposals are tantamount to tax increases that he won't support.
"As Kentucky grapples with the challenges of a global recession, raising broad-based taxes is not in the best interests of working Kentuckians and families," Beshear said in a statement.
The tax overhaul proposals don't fare any better in the Republican-led Senate. "I think there is a reluctance to look at tax reform because those proposals, at the bottom line, usually include some kind of tax increase," said Senate budget committee chairman Bob Leeper, an independent from Paducah.
Beshear and House Speaker Greg Stumbo, D-Prestonsburg, prefer raising revenue by allowing casino-style gambling at racetracks.
How much money slots at race tracks would actually generate for the state depends on the proposal. Under one proposal that passed the House this summer, the state could receive about $190 million annually. That proposal died in the Senate.
"When we get back to Frankfort in January we are going to have some very sobering budget projections to deal with," said Senate Minority Leader Ed Worley, D-Richmond. "The governor is going to make slots part of his revenue package.