KAM Team Keeps Late Hours as General Assembly Takes Break; No New Taxes……for Now

All eyes are now on Gov. Steve Beshear as he ponders what to do with the budget proposal that the General Assembly sent to him on Apr. 2.

In a process that involved many late-night sessions, some of KAM’s nine-member lobbying team kept pace right with lawmakers to be ready to push the positions of the manufacturing industry regarding proposed taxes, regulations and other initiatives that hung in the balance.

The 2008 session kicked off with a new administration and a downturn in the economy. Much of the session centered around the debate on casino gaming, which was the focal issue on which Gov. Beshear campaigned. A difference of whether language specifying that the racetracks in the state get a gaming license created a divide in the House and ultimately never received a vote by rank and file members.

With gaming off the table, the House looked to an increase in the cigarette tax for additional revenue. The 25 cent increase and a small group of other tax changes proposed to raise enough new revenue that the House restored cuts made by the Governor in his budget and financed additional programs. Ultimately though, the Senate refused to consider any tax increases, and both groups were forced to cut programs and find revenue enhancements that did not involve tax increases. In some cases programs were restored beyond the Governor’s cuts because limited additional revenue came into play.

The final budget bill that the House and Senate agreed upon is what many have called a “tightening your belt budget.” Few projects were funded and those that were, were considered to be emergencies. House Appropriations and Revenue Chair, Harry Moberly, voted against the budget, along with just 20 of his colleagues in the House. The basis for those who chose to not support the final document were the cuts in education and human services and the reluctance to raise taxes.

The lack of funds and increased attention on education, human services, and corrections took precedent this session. Gaming and the cigarette tax, brought the notion of additional money for additional projects, however when those couldn’t be agreed upon, the General Assembly decided to do the best they could with what little money they had and agreed to restore funds to the areas mentioned above.

The General Assembly adjourned and will reconvene April 14-15 to consider any gubernatorial vetoes. KAM expects that, as in past years, they will continue to work and vote on bills those last two days.

Following is the status of some bills of interest when the legislature recessed (bills can still be enacted on April 14-15, but the legislature would have no chance to override any gubernatorial vetoes): HB 256, adopting the Multistate Tax Compact, passed the House but remained in Senate committee. HB 346, restoring the elements of common law relating to “slip and fall” lawsuits, remained in House committee. SB 69, which cuts the tax imposed on waste burned for energy recovery, passed and has gone to the Governor. HB 257, imposing a statewide utility gross receipts tax to replace taxes levied by local school districts, remained in House committee. HB 165, which promotes public and private use of demand-side energy management, passed the Senate but remained in House committee. HB 361, a proposed Constitutional Amendment giving local governments authority to levy a sales tax, died in House committee. HB 382, a bill requiring use of a “comparable worth” standard in gender-based wage determinations, passed the House but remained in Senate committee. SB 32, the Career Pathways Act of 2008, was passed by the Senate but remains in the House Appropriations and Revenue Committee. SB 2 (STEM Legislation), passed the Senate 36-0 on Jan. 23 and passed the House 94-0 on Apr. 2 with a floor amendment. The bill was sent back to the Senate, where it can be considered for passage on Apr. 14 or 15.

KAM will continue to keep you updated on issues important to the manufacturing industry through April 15.

Editor’s Note: Legislative Update is an E-Newsletter for members and
stakeholders in the Kentucky Association of Manufacturers (KAM). It is
published periodically to communicate important information about how KAM is looking out for your interests in the Kentucky General Assembly, U.S. Congress, local governments, or through other groups and/or associations. Through KAM, you have the largest and most experienced team of lobbyists in Kentucky, led by Hank List, vice president of government affairs. If you do not want to receive KAM Legislative Update, please let us know by return e-mail.

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