Soon after Chandler took office, it became clear that he could not fund the social programs initiated by Clements and Wetherby and Chandler's own proposed programs,  with the revenue then being brought into the state treasury.
He cut the popular Youth Authority, which had been initiated by Wetherby to unify the state's children's welfare programs, but the savings were not enough to balance the budget.
To deliver on his campaign promises, Chandler ignored the budget during the regular legislative session in 1956 and then called a special session in which he presented his budget proposal.
The proposal called for spending in excess of $46 million more than officials estimated would be brought into the state's coffers over the two-year budget.
Chandler convinced legislators to pass the budget, promising to propose a tax plan to pay for the expenditures in a subsequent special session.
The promised package added 150,000 citizens to the state's tax rolls, put a surtax on income taxes, and cut tax credits.
It created a new 5 percent production tax on whisky and added taxes to deeds and life insurance premiums.
It increased the state gasoline tax for trucks by two cents per gallon and raised corporate tax by half a percent.
In addition, it transferred the assessment and collection of taxes on certain intangibles from local to state government.
The plan also called for a $100 million bond issue, allowing the allocation of generous budgets for state universities and colleges and improvements to the state highway system.

Although Democrats held a majority in both houses of the General Assembly, they were divided by factionalism, which made it difficult for Chandler to find sufficient support for his programs.
Some of the factionalism came from Clements and Combs supporters who were not willing to co-operate with Chandler, their chief political enemy.
Still other resistance to Chandler came from a group of more liberal lawmakers, like John B. Breckinridge, who simply had philosophical differences with the governor.
Near the end of the 1958 legislative session, that group demanded a special session to deal with the need for more money for schools and welfare programs, but Chandler refused to call the session when the liberals would not agree to pass only the measures he put before them.
Because of the factionalism, Chandler had to ally with Republican legislators throughout his term to pass many of his proposals, including his tax plan.
Frequently, that meant promising to build or repair roads in Republican districts in return for their support of his programs.

During his campaign, Chandler had promised that he would fund a medical school at the University of Kentucky although the University of Louisville already had a medical school, which made a poll of state physicians show overwhelming opposition to the plan.
Nevertheless, Chandler delivered on his promise by allocating $5 million to the establishment of what became known as the Albert B. Chandler Medical Center.
Chandler said that the establishment of the school was his proudest achievement as governor.

Just as when he had been baseball commissioner, Chandler faced the issue of racial integration during his second term as governor.
Among his first actions upon his election was to issue an executive order, ensuring that blacks and whites would have equal access to the state park system.
He publicly acknowledged the US Supreme Court's 1954 decision in Brown v. Board of Education as the law of the land and promised to enforce it.
The Kentucky Court of Appeals struck down Kentucky's Day Law, against integration, the following year.
Some areas of the state resisted the change.
Notably, in 1956, when nine black students in Sturgis, Kentucky, attempted to enter the all-white Sturgis High School, they were blocked by 500 opponents of integration.
On September 4, 1956, Chandler called out the National Guard, including a force of over 900 guardsmen and several M47 Patton tanks, to disperse the crowd.
The confrontation lasted a total of 18 days before the protesters peacefully dispersed.
S
Soon after Chandler took office, it became clear that he could not fund the social programs initiated by Clements and Wetherby and Chandler's own proposed programs,  with the revenue then being brought into the state treasury. He cut the popular Youth Authority, which had been initiated by Wetherby to unify the state's children's welfare programs, but the savings were not enough to balance the budget. To deliver on his campaign promises, Chandler ignored the budget during the regular legislative session in 1956 and then called a special session in which he presented his budget proposal. The proposal called for spending in excess of $46 million more than officials estimated would be brought into the state's coffers over the two-year budget. Chandler convinced legislators to pass the budget, promising to propose a tax plan to pay for the expenditures in a subsequent special session. The promised package added 150,000 citizens to the state's tax rolls, put a surtax on income taxes, and cut tax credits. It created a new 5 percent production tax on whisky and added taxes to deeds and life insurance premiums. It increased the state gasoline tax for trucks by two cents per gallon and raised corporate tax by half a percent. In addition, it transferred the assessment and collection of taxes on certain intangibles from local to state government. The plan also called for a $100 million bond issue, allowing the allocation of generous budgets for state universities and colleges and improvements to the state highway system.
Although Democrats held a majority in both houses of the General Assembly, they were divided by factionalism, which made it difficult for Chandler to find sufficient support for his programs. Some of the factionalism came from Clements and Combs supporters who were not willing to co-operate with Chandler, their chief political enemy. Still other resistance to Chandler came from a group of more liberal lawmakers, like John B. Breckinridge, who simply had philosophical differences with the governor. Near the end of the 1958 legislative session, that group demanded a special session to deal with the need for more money for schools and welfare programs, but Chandler refused to call the session when the liberals would not agree to pass only the measures he put before them. Because of the factionalism, Chandler had to ally with Republican legislators throughout his term to pass many of his proposals, including his tax plan. Frequently, that meant promising to build or repair roads in Republican districts in return for their support of his programs.
During his campaign, Chandler had promised that he would fund a medical school at the University of Kentucky although the University of Louisville already had a medical school, which made a poll of state physicians show overwhelming opposition to the plan. Nevertheless, Chandler delivered on his promise by allocating $5 million to the establishment of what became known as the Albert B. Chandler Medical Center. Chandler said that the establishment of the school was his proudest achievement as governor.
Just as when he had been baseball commissioner, Chandler faced the issue of racial integration during his second term as governor. Among his first actions upon his election was to issue an executive order, ensuring that blacks and whites would have equal access to the state park system. He publicly acknowledged the US Supreme Court's 1954 decision in Brown v. Board of Education as the law of the land and promised to enforce it. The Kentucky Court of Appeals struck down Kentucky's Day Law, against integration, the following year. Some areas of the state resisted the change. Notably, in 1956, when nine black students in Sturgis, Kentucky, attempted to enter the all-white Sturgis High School, they were blocked by 500 opponents of integration. On September 4, 1956, Chandler called out the National Guard, including a force of over 900 guardsmen and several M47 Patton tanks, to disperse the crowd. The confrontation lasted a total of 18 days before the protesters peacefully dispersed. S
Happy Chandler