Frankfort Inside Out - Legislative Update, March 3, 2014

As February came to a close, the Kentucky General Assembly now enters crunch time for completing its business. With only 23 days of the 60-day session remaining, legislators will be forced to work later into the evenings to consider the more than 1,000 bills and resolutions filed for consideration.

Today is the last day for House members to file a bill; Senators have until Wednesday. The session will continue through the end of March for regular business before entering a recess period for the governor to consider bills passed. They are scheduled to return April 14 and will adjourn April 15.

The most pressing issue is the state budget for the next two years. The House has not yet taken formal action on the budget, but has been holding hearings in the budget subcommittees. Most of the deliberations take place behind the scenes and become public when formal action is taken. Crafting a $20 billion, two-year budget is a massive undertaking, as literally hundreds of decisions must be made. With four weeks remaining, it is likely the budget will be debated up until the March 31 deadline to ensure the legislature can consider potential vetoes.

In the final week of February, there was action on a number of bills, while others are still being debated. Detailed below are a number of issues that saw formal legislative action. To see the complete list of bills and resolutions our team is monitoring, download our bill track, which provides a detailed summary of each bill and the current status.

Work continues on the Chamber’s public-private partnership legislation. HB 407, sponsored by Rep. Leslie Combs and co-sponsored by nearly 20 bi-partisan representatives across the state, encourages competition for private-sector investments, saves tax dollars, and promotes transparency and accountability. Every state bordering Kentucky already has P3 legislation. The Kentucky Chamber of Commerce, along with the Kentucky Association of Highway Contractors, the Associated General Contractors of Kentucky (AGC), and nearly 20 local chambers of commerce support the legislation. Please contact your Representative at 1-800-372-7181 and urge them to support P3 legislation.

Medical Review Panels – SB 119 (Denton) establishes medical review panels, a process for evaluating proposed claims against health care providers. This common sense bill will help put an end to the growing number of meritless lawsuits that increase Kentucky’s health care costs. With health care costs remaining a serious concern for all employers, the Chamber has joined with several business and health care groups to launch Care First Kentucky, aimed at addressing the serious threat of meritless lawsuits that take a significant financial toll on medical malpractice liability rates for Kentucky’s health care providers. SB 119 passed out of the Senate last week and now awaits a hearing in the House Health and Welfare Committee. We urge you to contact your representative at 1-800-372-7181 and ask them to support SB 119. (Chamber supports)

Health Benefit Plans – HB 362 (Stone) prohibits health benefit plans from limiting out-of-network providers and covered services to those performed within the Commonwealth of Kentucky. This appears to be an attempt to address limited health plans offered on or off the state’s health care exchange. The Chamber expressed concerns that mandating expanded networks could remove the cost savings negotiated for these lower cost plans. The Chamber appreciates Rep. Stone clarifying the legislation and making important changes in committee this week to address our concerns. HB 362 was passed by the House on Friday.

Smoke Free Workplace – HB 173 (Westrom) and SB 117(Denton) prohibits smoking in all indoor public places and workplaces and has received overwhelming support from Chamber members. The Chamber urges legislators to take a vote on House Bill 173, which awaits a hearing on the House floor. We urge you to contact your House & Senate members at 1-800-372-7181 and ask them to support a smoke-free law.

Right-to-Work The Chamber joined with several statewide economic development and business groups as Rep. Hoover announced he would push for a Kentucky Right-to-Work law. HB 496 would simply allow workers the freedom to decide whether to join a union, which would prevent it from being a condition of employment. This is a huge factor in economic development as a key factor in attracting new business to a state. (Chamber supports)

Local Option – HB 399 and SB 135 would give voters the chance to allow local communities to vote for a temporary sales tax to fund important local projects. Thirty-seven states allow a local option; Kentucky currently does not. The legislation received a favorable response from a legislative committee Thursday, but no vote was held. To learn more about this initiative and how to support it, visitLIFTKentucky.   (Chamber supports)

Casino Gaming – HB 67 (Clark) and SB 33 (Seum) amend the Kentucky Constitution to allow the General Assembly to submit to Kentucky voters to permit casino gaming. The Chamber has long supported expanded gaming to provide a much needed boost to the state as well as to recoup the hundreds of millions of dollars being spent annually in casinos in neighboring states. Additional discussions took place this week, but no action has been taken. To learn how to get involved, visit Kentucky Wins. (Chamber supports)

Pension Spiking – SB 142 (McDaniel) will help state and local governments reduce their unfunded liability by addressing pension “spiking.” Spiking occurs when a public-sector employee increases their creditable compensation more than 10% in a fiscal year during the five years prior to retirement. When a “spike” occurs, the last employer is required to pay the actuarial rate of the resulting increased retirement benefit, which includes the employee’s and employer’s cost. SB 142 passed the Senate 35-2 Friday, and now heads to the House for consideration. (Chamber supports)

Teacher Tenure SB 168 (Wilson) allows for suspension or termination of a teacher's continuing service contract if the teacher fails to successfully meet the requirements of a corrective action plan. It also establishes a new process for teachers who are first hired after July 1, 2015, to achieve continuing service contract status. (Chamber supports)

Due Process for Teachers SB 169 (Wilson) would clarify the causes for which a contract of a teacher may be terminated. It would also require the commissioner of education to initiate the appropriate procedure in response to a teacher's appeal and appoint hearing officers to hear the case. (Chamber supports)

Contractor Notification – HB 467 (Denham) allows businesses to enter the information of their subcontractors on the Division of Workers’ Claims website and receive notification when there has been a change or cancellation in their subcontractor’s workers’ compensation insurance coverage. (Chamber supports)

Eminent Domain – HB 31 (Tilley) raises concerns for economic development growth by limiting the ability to transport natural gas liquids, including propane and butane in Kentucky by denying the ability to use eminent domain in the rare instance it would be used. This measure could impact Kentucky’s manufacturers and agriculture community who rely on steady supplies of raw materials in a daily basis at their facility. The measure passed the House Judiciary Committee this week and awaits action on the House Floor. (Chamber opposes)

Data Breach Notification – HB 232 (Riggs) sets forth requirements for employers to notify customers in the event of a data breach that could expose individuals to identity theft. The Chamber thanks Rep. Riggs for working with us to ensure the requirements were not overly burdensome. The Chamber supports the bill with the committee amendment adopted Thursday. It now goes to the full House for consideration. (Chamber supports)

Statute of Limitations HB 369 (Yonts), which lowers the statute of limitations for written contracts from 15 years to 10 years, passed unanimously out of the House Judiciary Committee on Wednesday. Currently, at 15 years, Kentucky has the highest statute of limitations for written contracts in the nation; the next lowest being 10 years. The bill now awaits passage on the House floor. (Chamber supports)

Workers’ Comp Reporting HB 349 (Waide) simplifies the requirement for businesses which must file tax returns, partnership agreements and articles of organization with the Department of Workers’ Claims. The bill removes the requirement for an annual filing. HB 349 would only require employers to submit these at the request of the Commissioner. (Chamber supports)

Greenhouse Gas Emissions – HB 388 (Gooch) establishes Kentucky-based standards for greenhouse gas emissions by electric utilities. This measure pushes back on U.S. EPA’s ruling to regulate greenhouse gas emissions, which will drive up Kentucky’s electricity prices. HB 388 passed the House 99-0 and will now be considered by the Senate. (Chamber supports)


Fire Sprinklers – HB 420 (Glenn) would seek to increase requirements for sprinkler fitters and require a certification and union apprentice permit to do work in the Commonwealth. This will increase costs to current professionals operating in the Commonwealth and set a negative precedent that will increase costs for projects in the future. (Chamber opposes)

Public Pension Audits – HB 389 (Yonts) requires all of Kentucky’s public employee pension systems to undergo an independent audit every five years. HB 389 passed the House 99-0 and is now in the Senate for consideration. (Chamber supports)

Tax Whistleblowers – HB 438 (Combs) creates a taxpayer whistleblower program. It gives the Department of Revenue broad discretion to create the program to target individual and business taxpayers, with up to $250,000 bounty and could place tax preparers at a greater risk of liability. (Chamber opposes)


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