Is Kentucky in fiscal crisis, or isn't it?

UPDATED WITH VIDEO

Kentucky faces a $600 million budget shortfall next year, according to its official revenue projections, but how bad are things really? Democratic Gov. Steve Beshear, just weeks into his term, says he’s been immersed in budgetary details nearly 24-7, and he’s telling everyone who will listen – and even those who won’t – that straits are dire indeed.

“It is a crisis situation,” Beshear said at a recent conference of Kentucky editorial writers in Frankfort. Revenues are projected to drop from their current level, he said, and with Medicaid and corrections costs rising, the squeeze will be on education and other programs. Then, in his budget speech Tuesday night, Beshear outlined exactly where he thinks the cuts should be made.

But legislative leaders, including some in his own party, aren’t painting the situation as quite so bleak. “I don’t think the budget situation is a crisis, but it is very difficult,” Senate Minority Leader Ed Worley, D-Richmond, told the journalists. “We just have to establish priorities.”

“This is the eighth governor I’ve worked with,” noted House Speaker Jody Richards, also a Democrat. “They all have one thing in common: They’re broke when they come in here. This one’s just broker than usual.”

Senate President David Williams, R-Burkesville, responded to Beshear’s assessment with his typically dry sarcasm. “I’m wearing a black tie today because the death watch is on here in Frankfort. It’s all doom and gloom.” Williams said that revenues are a bit ahead of last year’s, and that unused funds recouped from state agencies can help close the gap. “I am convinced that collectively we can put a good budget together.”

So which is it? Some believe Beshear is poor-mouthing the state’s finances so that Kentuckians will see a greater need to pass a casino gambling amendment. But a budget gap – whatever the exact figure – is real, and with pressing needs for increased funding in education and infrastructure (read: Brent Spence Bridge), the state needs real solutions.

One thing’s for sure: Kentucky’s budget-crafters can’t be counting their casino chickens before they hatch. The smart bet is to craft a lean, tight budget that doesn’t anticipate a short-term or long-term boost from gambling revenues. Expanded gambling “is not a panacea, it is another possible source of revenue,” Worley said. “But if the voters say no, we need to drop it and move on.”

Below: Kentucky Gov. Steve Beshear talks about the state's budget at an editorial writers' conference in Frankfort.