2015 session produces many successes along with some missed opportunities for business

The 2015 session of the General Assembly has received praise from many leaders across the state as a productive and successful session because of the passage of bills to address issues like the stabilization of the road fund, telecommunications reform, and the scourge of heroin in the state—legislation strongly supported by the Kentucky Chamber.

However, there were also many pro-business bills that fell short this year and have been pushed to the back burner once again.

The Kentucky Chamber was pushing business-friendly bills that would help the state create jobs and attract new business, including legislation to set up public-private partnerships (P3) to complete projects across the state, local option sales taxes (LIFT) to allow local communities to be put in charge of their futures, right to work measures which would let an employee choose whether or not they want to join a union, and much more.

Kentucky Chamber President and CEO Dave Adkisson wrote an op-ed that was sent to newspapers this week summarizing our thoughts on the 2015 General Assembly.

“Anyone working to advance Kentucky can expect to encounter some obstacles,” wrote Adkisson. “We continue to hope that, as Kentuckians with a shared goal of making progress for our state, we can take at least two steps forward for every one step backward.”

The Kentucky Chamber will issue its Results for Business in the next few weeks which will have a full rundown of what passed, what didn’t, missed opportunities of the session and how your legislator voted on these key business issues.

Kentucky Chamber-supported legislation that passed both chambers and was sent to the governor for his signature include:

• Telecommunications Reform (HB 152) provides telecom providers the flexibility to invest in new technology. The Kentucky Chamber has strongly supported this legislation which will help make our Commonwealth more attractive to businesses so we can compete for investment dollars and jobs.
• Anti-heroin legislation (SB 192) addresses the scourge of heroin in the state through treatment funding, tougher penalties on dealers, creation of programs to allow local governments to set up needle exchanges and other health initiatives.
• Road fund stabilization (HB 299) ensures the state’s road fund will not experience a revenue shortfall and have the money for important transportation projects by freezing the tax on gasoline at 26 cents per gallon.
• Crowdfunding (HB 76) creates online crowdfunding investment opportunities in Kentucky that will make it easier to invest in business ideas that look promising.
• Pension Oversight (HB 47) added the Legislative, Judicial and Teachers’ Retirement Systems to the Public Pension Oversight Board.
• Clean Power Plan (HCR 168) directs the Legislative Research Commission (LRC) to establish a task force to perform a one-time study which assesses the potential impacts of federal environmental regulations on the “affordability” and “reliability” of electricity generation in Kentucky.
• Unfunded Liability (HB 62) ensures any entity choosing to withdraw from the Kentucky Retirement System must repay their unfunded liability.
• Kentucky Oil and Gas Modernization Act (SB 186) 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 legislation makes the first significant reforms to Kentucky’s regulation of the oil and gas industry in approximately 20 years.
• 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 childcare providers.
• Craft Academy (HB 232) allows the Craft Academy for Excellence in Science and Mathematics to award a high school diploma and allows students enrolled in the academy to earn KEES scholarships.

Missed opportunities:

• Public-Private Partnership (P3) (HB 443) would have provided 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.
• Local Option Sales Tax (LIFT) (HB 1) would have given local communities the option to place an additional sales tax of up to one cent on the ballot for voter approval.
• Right to Work (SB 1) a Chamber-supported effort which would have made Kentucky a right-to-work state and allow workers to choose whether or not they want to join a labor union.
• Charter Schools (SB 8/HB 174) would have created a public charter school pilot project beginning in academic year 2016-2017 and continuing through academic year 2020-2021.

• Medical Review Panels (SB 6) would have created 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.
• Smoke-Free (HB 145) would have prohibited smoking in all indoor public places, including restaurants, bars and workplaces. This legislation has received overwhelming support from Chamber members.
• Actuarial Analysis (HB 306) would have required that funding mechanisms be disclosed and an actuarial study of the system be conducted every five years.
• Prevailing Wage (SB 9) would have excluded all educational buildings are facilities from meeting the requirements of the existing prevailing wage law.
• Independent Actuary Request (HJR 7) would have directed the Public Pension Oversight Board to hire an independent actuary. The Chamber recommended this action last summer and believes it is a critical step in providing needed oversight to scrutinize assumptions that involve hundreds of millions of dollars and affect the entire $10 billion General Fund budget.

• Pension Transparency (SB 22) would have strengthened 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.
• Taxpayer Rights Enhancement Act (HB 361) would have brought much needed transparency, efficiency and equity to our tax code.
• Limiting State Debt (SB 94) would have limited General Fund appropriations supported debt to no more than 6% of the budget.
• Nuclear Power (SB 90) would have lifted the ban on nuclear power plants and requires that nuclear power facilities have a plan for the storage of nuclear waste.
• Kentucky Workforce Oversight Task Force (SCR 103) would have directed 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.
• Distillery Modernization (HB 198) would have permitted bourbon distillers to sell their products by the drink to visitors at their distilleries, just as wineries and breweries do today.

Anti-Business Bills Defeated:

• Minimum Wage Increase (HB 2) would have incrementally raise the state’s minimum wage higher than surrounding states.
• Workers’ Compensation (HB 294) would have raised attorneys’ fees for workers’ compensation cases resulting in cost increases for business.
• Pipeline Safety (HB 272) would have established a pipeline safety fund by imposing a levy on oil and gas pipelines running through Kentucky.
• Construction Material Mandate (HB 57) would have unnecessarily increased 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.
• Independent Contractor (HB 256) would have added penalties against business of which there is not a clear definition of an independent contractor.
• Mine Regulations (HB 131) would have increased restrictions, beyond current federal requirements, for operating surface mines as well as reclaimed sites.
• Tax Increase (HB 132) negative tax changes that would have impact businesses by essentially increasing taxes half billion dollars.