Kentucky Chamber of Commerce - Frankfort Inside Out

Frankfort, Ky. (February 27, 2015) - One of the Chamber’s top priorities, House Bill 443, which authorizes public-private partnerships (P3), passed out of the House of Representatives on Wednesday evening after a lengthy floor debate with a vote of 84-14.

Much of the debate centered around several anti-toll amendments brought forth by Rep. Arnold Simpson, who is an adamant opponent of tolling the Brent Spence Bridge in northern Kentucky.  The amendment brought forth that would prohibit tolls on that project died in a roll call vote.

HB 443 differs from the P3 bill vetoed by Gov. Beshear last year in that the local government component is currently not included in the bill. Though incomplete, it is a step in the right direction.

Sponsor Rep. Leslie Combs presented the bill and stated she is hopeful that local governments will be included in the legislation before the end of the legislative session, but at this time an agreement has not been reached. Read more on the blog.

Telecom Reform

The House also passed House Bill 152, legislation which seeks to provide telecom providers with the flexibility to invest in new technology, on Tuesday with a vote of 71 to 25. The Senate plans to vote on this legislation Monday afternoon.

The Kentucky Chamber of Commerce strongly supports this legislation sponsored by Rep. Rick Rand. Telecommunications reform will help make our Commonwealth more attractive to businesses so we can compete for investment dollars and jobs.More.

Pension Bonding

The House passed House Bill 4, sponsored by Speaker Greg Stumbo, with a vote of 62-31. Being a revenue bill in a non-budget year, the bill required 60 votes to pass. HB 4 would bond $3.3 billion of the KTRS debt, but its prospects in the Senate are bleak.

Many in the business community are skeptical of additional bonding, especially since taxpayers have not had the benefit of vetting such a major initiative. This discussion focuses solely on the funding side and does not include a comprehensive review of the costs and sustainability of the benefits structure over time. For now, it would be imprudent for the business community to support such a proposal without a significant amount of open, public deliberation. House Bill 4 now heads to the Senate. Read more.

Energy

On Thursday, the state Senate passed the Kentucky Oil and Gas Modernization Act (SB 186), legislation which is the result of six months of negotiations with the Kentucky Chamber of Commerce, the Kentucky Oil and Gas Association, the Energy & Environment Cabinet and other industry leaders. The House passed thecompanion legislation House Bill 386 Wednesday with a 96-0 vote.

To read more about the legislation and other legislative action, click here.

There are several bills of interest noted below. The Chamberwelcomes your feedback or questions on these or any other legislation. To view a full list of bills the Chamber is monitoring this session, click here.

Key Bills

Health Care:

  • Smoke Free (HB 145/SB 189) – prohibits smoking in public places. HB 145 passed the House last week and awaits action in the Senate Veterans, Military Affairs and Public Protection Committee, where SB 189 has also been referred.
  • Medical Review Panels (SB 6/HB 398) – creates a system of medical review panels to address the escalating costs directly attributed to Kentucky's uncontrolled medical liability climate, an issue of serious concern for Kentucky employers. SB 6 passed the Senate several weeks ago and awaits action in the House Judiciary Committee.       HB 398 also awaits action in the House Judiciary Committee.
  • Cap the Copay (HB 146/SB 31) – mandates that health benefit plans cap the amount of copays on prescription drugs to no more than $100 for a 30-day supply and no more than $200 for a tiered formulary per month. The Senate Health and Welfare Committee heard discussion only testimony Wednesday on SB 31. HB 146 awaits a hearing in the House Banking and Insurance Committee.
  • Addressing the Rising Heroin Epidemic (HB 213/SB 5) – seeks to address the growing heroin epidemic by increasing penalties and improving treatment options. HB 213 passed the House last week and had an information only hearing in the Senate Judiciary Committee on Thursday.  SB 5 passed the Senate the first week of session and had an information only hearing in the House Judiciary Committee on Thursday.

Competitiveness:

  • Local Option Sales Tax (LIFT) (HB 1) – gives local communities the option to place an additional sales tax of up to one cent on the ballot for voter approval. The measure passed the House last week and now awaits action in the Senate Elections, Constitutional Amendments, and Intergovernmental Affairs Committee.
  • Public-Private Partnership (P3) (HB 443) – provides an explicit framework for the use of public-private partnerships (P3s) as an alternative method of procurement, construction or financing of capital projects and services by state government. HB 443 passed the House on Wednesday and now awaits a committee hearing in the Senate.
  • Stabilization of the Road Fund (SB 29) – increases the AWP floor to the level used to calculate the rate that took effect January 1, 2015, which would stabilize the Road Fund to ensure much needed revenue for Kentucky’s infrastructure.
  • Crowdfunding (HB 76) – creates online crowdfunding investment opportunities in Kentucky that will make it easier to invest in business ideas that look promising. This legislation would allow people to invest up to $10,000 while helping businesses raise up to $2 million. HB 76 passed the House unanimously last week and awaits action in the Senate.
  • Workers' Compensation Issues (SB 95/HB 294) – raises attorneys’ fees for workers’ compensation cases. Both would raise costs to the system without any immediate benefit to employers. HB 294 was withdrawn on Wednesday and attached to HB 206, which deals with workers’ compensation for non-paid pastors.
  • Minimum Wage (HB 2) – incrementally raises the state’s minimum wage to $10.10. HB 2 passed the House last week and awaits action in the Senate.
  • Telecommunications Reform (SB 3/HB 152) – seeks to provide telecom providers the flexibility to invest in new technology.  HB 152 passed the House on Tuesday and now awaits action in Senate committee. SB 3 passed the Senate State and Local Government Committee last week and awaits action on the Senate floor.
  • Local Government Retail Operations (SB 130) – sets up clear procedures and a transparent process by which a local government would operate if entering into the retail or wholesale sale of a commercial product or service. SB 130 passed the Senate State Government Committee earlier this week and awaits action on the Senate floor.
  • Taxpayer Rights Enhancement Act (HB 361/HB 399) – brings much needed transparency, efficiency and equity to our tax code.
  • LLET (HB 331) – clarifies costs of goods sold definition in the LLET statute to make it easier for businesses and tax professionals to comply.
  • Transparency in Private Attorney Contracting (SB 118) – creates transparency, sets reasonable limits on contingency fees and codifies recent case law requirements to ensure the state remains in control of litigation when hiring contingency fee counsel. SB118 passed the Senate on Thursday with bipartisan support and now heads to the House for a committee hearing.
  • Distillery Modernization (HB 198) – permits bourbon distillers to sell their products by the drink to visitors at their distilleries, just as wineries and breweries do today. HB 198 passed the House Licensing and Occupations Committee earlier in session and now awaits passage on the House floor.
  • Limiting State’s Debt (SB 94) – limits General Fund appropriations-supported debt to no more than 6% of the budget. The Chamber has supported this concept for many years. SB 94 passed the Senate on Friday and now heads to the House.
  • Construction Material Mandate (HB 57) – unnecessarily increases costs on public construction projects by requiring construction materials, such as iron and steel, to be produced in the United States, regardless of cost or availability.
  • Circuit Court Venues (SB 178) – modifies standards for venue and jurisdiction in actions against the Commonwealth of Kentucky.

Education Bills:

  • Childcare Rating System (HB 234) – directs the Early Childhood Advisory Council to clarify participating agencies and establish a schedule for implementing a quality-based rating system for licensed childhood providers.  This Chamber-supported bill passed the House 81-16 and now awaits action in the Senate.
  • Dual Credits (SB 110) – permits high school seniors in the 2015/2016 school year and high school juniors and seniors in the 2016/2017 school year to use their KEES awards to pay for dual credit courses.  SB 110 passed the Senate 37-0 and now heads to the House for action.
  • School and Student Performance (SB 132) - allows a superintendent to select the principal in a school identified as an initial intervention school.  SB 132 passed the Senate 28-6 and now awaits action in the House.
  • Computer Science Programs in Public Schools (SB 16) - calls for the Kentucky Department of Education to make students in computer coding courses eligible for science credits. It also includes professional development for teachers beyond the core to include computer sciences. SB 16 passed the Senate and now awaits action in the House.
  • Charter Schools (SB 8) – establishes a public charter school pilot project to create new, innovative and more flexible ways of educating all children in the public school system.  SB 8 passed the Senate 23-11 and now awaits action in the house.
  • Postsecondary Education Capital Projects (HB 298) – authorizes bonds from the General Fund in fiscal year 2015-2016 for construction of a research building at the University of Kentucky. HB 298 passed the Senate A&R Committee and now heads to the floor for action.
  • Kentucky Workforce Oversight Task Force (SCR 103) – directs the Legislative Research Commission to establish the Kentucky Workforce Oversight Task Force to study and develop recommendations concerning the benefits, investments, and funding of workforce education. The task force must submit a report to the Legislative Research Commission by December 11, 2015. The resolution passed the Senate 37-0 and now awaits action in the House.
  • Post-Secondary Performance Based Funding (SJR 106) - directs the Kentucky Council on Postsecondary Education to develop a performance-based funding model for the public postsecondary education institutions.  The resolution passed the Senate Education Committee and now heads to the floor for action.
  • Low Performing Schools (HB 449) - requires schools that remain classified as persistently low-performing schools for four years to implement an internal innovation option. After failure of implementing existing intervention options, the school shall implement an innovation option that improves student learning and performance by expanding learning experiences for students with new or creative alternatives to existing instructional and administrative practices.  HB 449 passed the House 94-0 and now heads to the Senate for action.
  • Districts of Innovation Assessment Waivers (HB 34) - allows a waiver or modification of the statewide assessment system for schools participating in a district of innovation plan. HB 34 passed the House 95-1 and now awaits action in the Senate.
  • Student Achievement Gaps (HB 498) – requires a targeted focus school to undergo an audit and implement an internal innovation plan. The focus school must act within 30 days of receiving the report of the audit and the superintendent shall act on the recommendations in the report when creating the innovation plan.  HB 498 passed the House Education Committee this week and now heads to the floor for action.

Pension Bills:

  • Independent Actuary Request (HJR 7) – requests the Public Pension Oversight Board to hire an independent actuary.
  • Kentucky Teachers’ Retirement Bonding (HB 4) – allows the KTRS to bond $3.3 billion. HB 4 passed the House on Monday and awaits action in Senate committee.
  • Pension Oversight (HB 47) – adds Legislative, Judicial and KTRS to the Public Pension Oversight Board. HB 47 passed the House earlier in session and was passed out of Senate State Government Committee on Wednesday.
  • Pension Spiking (HB 116/HB 444/SB 157) – addresses the pension spiking issue that many local governments have been faced with recently. SB 157 passed the Senate State and Local Government Committee earlier this week and awaits hearing on the Senate floor.
  • Actuarial Analysis (HB 306) – requires funding mechanisms be disclosed and an actuarial study of the system be conducted every five years. HB 306 passed the House floor unanimously on Thursday.
  • Pension Transparency (SB 22) – strengthens transparency to require the Judicial Retirement Plan, the Legislators' Retirement Plan, the Kentucky Retirement Systems and the Kentucky Teachers' Retirement System to establish in administrative regulation a placement agent disclosure policy and require the policy to disclose to the boards of trustees of the plans and systems the name of the placement agent, the dollar value of the investment and the fees or payments made to placement agent for each investment in which a placement agent was used. SB 22 passed the Senate earlier in session and now awaits action in House committee.
  • Legislators Retirement Plan (SB 23) – allows legislators contributing to the Legislators' Retirement Plan prior to January 1, 2014, to make a one-time election to have their benefits from the system based solely on their legislative salary and any salary earned in another state-administered retirement system prior to January 1, 2014. SB 23 passed the Senate earlier in session and now awaits hearing in House committee.
  • Unfunded Liability (HB 62) – ensures any entity choosing to withdraw from the Kentucky Retirement System to repay their unfunded liability. HB 62 passed the House earlier in session and now awaits action on the Senate floor.
  • Pension Transparency (SB 20) – provides disclosure and transparency for legislators in the retirement system. SB 20 awaits action in the Senate State and Local Government Committee.

Energy bills:

  • Hazardous Waste Management Fund (HB 417) – extends the expiration date of the hazardous waste management fund assessment fee through 2024.  On Wednesday, the measure passed the House by a 97-0 vote and now heads to the Senate.
  • Nuclear Power (SB 90) – lifts ban on nuclear power plants and requires that nuclear power facilities have a plan for the storage of nuclear waste.  On Wednesday, the Senate Committee on Natural Resources and Energy passed the bill.
  • Natural Resource Severance (HB 194) – lessens the upfront financial impact on counties and cities receiving funds from the Local Government Economic Assistance Fund (LGEAF). Specifically, in the event that a tax refund is issued which reduces the amount of revenue going into the LGEAF.
  • Surface Coal Mining (HB 543) – gives the governmental responsibility for regulating surface coal mining operations solely to state government (Energy and Environment Cabinet).
  • Kentucky Oil and Gas Modernization Act (HB 386SB 186) – provides regulatory certainty for the development of Kentucky’s deep shale resources. These companion bills are the result of six months of negotiations with the Kentucky Chamber of Commerce, the Kentucky Oil and Gas Association, the Energy & Environment Cabinet, the Department of Natural Resources, the Division of Oil and Gas, the Kentucky Division of Water, the Kentucky Resources Council, the Kentucky Farm Bureau and other industry leaders.HB 386:  Unanimously passed the full House on Wednesday. SB 186: Unanimously passed the full Senate on Thursday.

 

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