Legislative Update: And Down the Stretch They Come

Nine Days Left – This week is the last full week of the 2016 General Assembly regular session, as legislators have used 51 of their 60 allotted legislative days. The current schedule has them in session all of this week and two days next week, March 28 & 29, for concurrence, before they recess until April 11 & 12 for veto override days, the last two days of the session.

House Passes Budget
– With the days ticking away, the General Assembly is racing to complete passage of a two-year spending plan, the session’s biggest issue. The House moved that process forward by passing their budget. We communicated with you last week about what exactly was in the House version of the budget relative to GLI’s priorities. Read our analysis. The action now turns to the Senate who will likely pass their version of the budget this week before a conference committee of House and Senate leaders meets to hammer out a final compromise that will be sent to the Governor for consideration of any vetoes.

Pensions Addressed
– The House took action in the state budget to fully fund the ARC for KRS and KTRS to help shore up those financially distressed public employee pension funds. They also took action on two bills of interest on pensions to GLI:

  • Senate Bill 2House Floor – Sen. Bowen’s bill that would make the pension systems more transparent and accountable passed the House State Government committee this week and is now in House Rules.
  • House Bill 1House Floor – A proposal to shore up the KY Teachers Retirement system with $3.3 billion in bonding, was drastically altered this week and now requires the General Assembly to fund the full actuarially required contribution for the KTRS. It awaits action on the House floor.

Public Private Partnerships (P3s) – After several years of refining Public-Private Partnership (P3) legislation, House Bill 309 could be heard on the Senate floor today! Greater Louisville Inc. has endorsed P3 legislation. It is time that Kentucky joined the 39 other states that have P3 legislation and send a strong signal to Kentucky’s business community, local governments, contractors, and workforce that we are serious about forging ahead with needed infrastructure and services in an innovative fashion. The Senate Economic Development committee passed the bill this week and we are asking that you weigh in with your state senator to let them know you support P3. It is critical that the Senate hear from members of the business community on this issue. Please Call YOUR Senator at (800) 372-7181 and ask them to support P3 legislation as another tool in Kentucky’s economic development toolbox.

School Leadership
– One of the key education issues for Louisville and JCPS for the 2016 Session is to give superintendents more flexibility in selection of principals within school districts. House Bill 184 sponsored by Louisville Delegation Chair Jeff Donohue passed favorably by the Senate Education committee this week. GLI continues to urge passage of this important bill as it makes its way through the final steps of the legislative process.

Felony Expungement
House Bill 40 filed by Louisville Representative Daryl Owens, would allow for the expungement of some non-violent class D felonies while providing provisions that offering protection for employers. The bill got moving in the Senate this week as the bill was amended with many of the provisions of Senate Bill 298, though with just a 5-year waiting period, and favorably reported. This is a critical workforce issue for GLI that was addressed by the Senate Judiciary committee this week. We urge passage as the final days of the session near.

LIFT Still in the Mix
– GLI’s number one legislative priority is passage of legislation allowing for the Local Investments For Transformation, www.liftkentucky.com. House Bill 2, a constitutional amendment allowing for LIFT, and House Bill 374 the enabling legislation, both have passed the House and await action in the Senate. With just a handful of days left in the session we need to push them over the finish line to passage. Please Call (800) 372-7181 and TELL Your Senator: Let local VOTERS decide on important local projects that will improve quality of life and economic development. Please support HB2 and LIFT Kentucky.

Returning Pharmacy Jobs to Kentucky
– Several years ago, outdated pharmacy regulations prevented pharmaceutical distributor Medco from locating in Kentucky. House Bill 527, filed by Rep. Tom Burch and co-sponsored by Rep. Jerry Miller, would allow certain administrative activities to take place outside the supervision of a licensed pharmacist which would lower costs. It passed out of the House and the Senate Health & Welfare committee this week and is headed to the Senate Floor. GLI has played a critical leadership role in promoting this legislation, including testifying in committee, because it would allow one of GLI’s members to create a pharmacy hub in Louisville. We appreciate the bi-partisan leadership demonstrated by Reps. Burch and Miller & Sen. Julie Raque Adams.

Senate will not pursue Right to Work, Medical Review Panels.
Senate President Robert Stivers has pulled two of the Senate’s top 10 bills after recognizing the lack of will in the House to move the legislation forward. The decision comes on the heels of Democrats’ surprise wins in three out of four House special elections on March 8th. Right to Work and medical liability reform are two of GLI’s top priorities and GLI will push strongly for their consideration in the 2017 legislative session.

PASS Bourbon tourism reform now!
Time is running out. Please call your legislators and ask them to pass all provisions of SB 11 and HB 433.  Every provision in SB 11 and HB 433 are critical to growing the Kentucky Bourbon Trail®, creating jobs, leveling the playing field and keeping Kentucky competitive. The future of Kentucky’s tourism and economic development depend on it.  Please Call (800) 372-7181 and voice your support for Kentucky’s signature bourbon industry.

Make workforce a budget priority!
In the budget passed last week, the House dropped a $100 million bonding pool for workforce development from the Governor’s proposal. This pool can provide critical workforce training to ensure the sustainability of Kentucky’s employee base. Please Call (800) 372-7181 and tell your Senator to put the original $100 million bonding pool for workforce development back in the budget.

GLI has a comprehensive legislative agenda for 2016.
Below is an update on some of the bills from the agenda:

Key Bills Moving Forward Last Week

 
Business & Non-Profit Regulation

  • House Bill 367Senate Appropriations & Revenue – Filed by Speaker Pro Tem Jody Richards, would make technical changes to modernize the current laws governing Kentucky’s nonprofit sector and would exempt veteran-owned businesses from paying certain filing fees to the Secretary of State.

Educational Reciprocity

  • Senate Bill 140House Education – Filed by Sen. Max Wise, would allow the Council on Postsecondary Education to enter into reciprocity agreements with institutions in other states to provide distance education to Kentucky residents. GLI is supportive of this bill.

Felony Expungement – This is a critical workforce issue for GLI.

  • House Bill 40Senate Floor – Filed by Louisville Representative Daryl Owens, would allow for the expungement of some non-violent class D felonies. Requires a 5 year waiting period.
  • Senate Bill 298Returned to Senate Judiciary – Filed by Senate President Robert Stivers, is the Senate’s expungement bill. The bill exempts very specific felonies and requires a 10 year waiting period.

Franchises

  • Senate Bill 198House Labor & Industry – This legislation filed by Sen. Wil Schroder, would provide that neither a franchisee nor an employee of a franchisee shall be deemed to be an employee of the franchisor for purposes of wage and hour laws, occupational safety laws, unemployment laws, and workers comp laws. GLI supports this bill.

LIFT – These two bills deal directly with GLI’s top legislative priority:

  • House Bill 374Senate Appropriations & Revenue – The LIFT enabling legislation was filed by Rep. Tommy Thompson.
  • House Bill 2Awaiting Senate action – Filed by Speaker Stumbo and Minority Leader Hoover, the constitutional amendment would allow for a local option sales tax.

Justice Reform

  • House Bill 412Passed House, Awaiting Senate Action – would create a new category of misdemeanor as well as implement additional reforms that would streamline the redemption process for non-violent felons. GLI supports a smarter, more cost-effective approach to criminal justice.

Kentucky Economic Development Partnership

  • House Bill 216Senate Consent Calendar – Filed by Rep. Mike Denham, would add the chairperson of the Commission on Small Business Advocacy and a representative from the NFIB/Kentucky to the Kentucky Economic Development Partnership. GLI supports this measure.

Medical Review Panels

  • Senate Bill 6Recommitted from Senate Floor to Health & Welfare – Sponsored by Sen. Ralph Alvarado, creates a system of medical review panels to address the escalating costs directly attributed to Kentucky’s uncontrolled medical liability climate. GLI supports this legislation.

Pensions

  • Senate Bill 2House Floor – Sen. Bowen’s bill would make the pension systems more transparent and accountable.
  • House Bill 1House Floor – Speaker Stumbo’s proposal to shore up the KY Teachers Retirement system with $3.3 billion in bonding. (After passing committee this week it was recommitted to A&R, we expect this will play out in the budget)
  • House Bill 271House Floor – Rep. Jerry Miller’s bill requires benefit information to be disclosed by the retirement systems.

Pharmacy Administration

  • House Bill 527Posted for Passage on Senate Consent Agenda – Filed by Rep. Tom Burch and co-sponsored by Rep. Jerry Miller, would amend Kentucky’s pharmacy law to allow pharmacies to perform administrative activities outside of a licensed pharmacy in the United States, while protecting patients’ interests by keeping activities related to the evaluation and implementation of drug orders, including dispensing activities, inside licensed pharmacies. GLI has been a driving force behind this legislation.

Public-Private Partnerships (P3)

  • House Bill 309Posted for Passage in Senate – Sponsored by Rep. Leslie Combs, it would allow for P3s as a critical tool for the Commonwealth accomplishing economic development projects in cooperation with private industry. GLI supports allowing P3s in Kentucky.
  • Senate Bill 132 – Senate Economic Development – Sponsored by Sen. Max Wise, is the Senate companion bill to HB 309.

Radon Mitigation

  • House Bill 272Senate Floor – Filed by Rep. Tommy Thompson, would exempt residential building contractors installing vent pipes from radon mitigation certification requirements, making Kentucky contractors more competitive and efficient. GLI supports this legislation.

School Leadership

  • House Bill 184 Senate Floor – Sponsored by Louisville Delegation Chair Jeff Donohue, is one of the key education issues for Louisville and JCPS for the 2016 Session is to give superintendents more flexibility in selection of principals within school districts. GLI is a proponent of this legislation.

Workforce Development
Two resolutions have been filed that would establish the Kentucky Workforce Oversight Task Force to study and develop recommendations concerning the benefits, investments, and funding of workforce education.

Work Ready Kentucky

  • House Bill 626 – Passed House, Awaiting Senate Action – The House Democrat’s Work Ready Kentucky Scholarship Program passed the House Appropriations & Revenue committee this week and it is poised to be voted off the House floor next week. The program would provide free tuition for graduating high school students attending the state’s community and technical colleges. The program is apparently not requiring new dollars, but is being funded out of other funds in Governor Bevin’s budget.

Key Bills

Distillery Modernization
– Two key bills of interest: GLI supports placing the distilled spirits industry on equal footing with wineries and breweries in the Commonwealth:

  • House Bill 433House Licensing & Occupations – Focuses specifically on clean-up of distilled spirits issues, was filed with 41 members of the House signing on as co-sponsors.
  • Senate Bill 11House Licensing & Occupations – Is an omnibus clean-up of various alcohol-related issues, including the distillery issues in HB 433. (Posted and poised for hearing this week)

Education Standards – Two key bills of interest on education standards:

  • Senate Bill 1House Education – SB 1 is an omnibus education reform proposal that will set up a process for reviewing the state’s education standards and aligning them with the assessment and accountability system.
  • Senate Bill 210 & House Bill 553Senate & House Education – SB 210 & HB 553 would repeal and replace Kentucky’s current academic standards, which would be an inefficient use of dollars and time for our teachers. GLI is opposed to SB 210 & HB 553.

Encourage Computer Science in Schools

  • Senate Bill 107House Education – Would encourage the development of more computer science programs in local schools. GLI supports this legislation.

Expanded Gaming

  • Senate Bill 144Senate Veterans – Sponsored by Sen. Morgan McGarvey and Sen. Julie Raque Adams, this is a constitutional amendment legalizing casino gaming and dedicating 90% of the proceeds to Kentucky’s public employee pensions. GLI took a leadership role in support of this measure.

Historic Preservation Tax Credits

  • House Bill 424House Appropriations & Revenue – Filed by Co-Chairman Rick Rand, would raise the program cap for commercial projects below $3 million in qualified expenditures to $9 million and the per project cap to $900,000; establish a $1 million program cap for residential projects; and create a new incentive for “catalytic commercial projects” above $3 million in qualified expenditures.

KEES for Dual Credit

  • Senate Bill 127Senate Appropriations & Revenue – This legislation would allow Kentucky students to use their KEES scholarships for dual credit courses while they are still in high school. GLI is supportive of SB 127.

Kentucky Preference in Procurement

  • House Bill 227House State Government – Filed by Rep. Jeff Donohue, would give a preference in state procurement to products made in Kentucky regardless of cost or availability. GLI is concerned this bill could lead to increased costs.

Landlord Liability

  • Senate Bill 68House Judiciary – Would correct a 2012 KY Supreme Court ruling that made a landlord strictly liable for the actions of a tenant’s dog. GLI will be pushing for its consideration.

Lawn Service Workers Comp Exemption

  • House Bill 56House Floor – Rep. Myron Dossett includes lawn services to the list of exemptions from workers’ compensation on a private home for not more than 20 days.

Limited Liability Entity Tax

  • House Bill 292House Appropriations & Revenue – Filed by Rep. Brent Yonts, would expand the definition of “cost of goods sold” under the LLET to include any costs allowed by the Internal Revenue Code. GLI is a proponent of this bill.

Maternity Leave

  • House Bill 627House Labor & Industry – Filed by Rep. James Kay, would require employers with more than 50 employees to provide 6 weeks paid maternity leave for an employee. GLI opposes this legislation because it places an unnecessary mandate on employers.

Pensions – Several bills of interest:

  • Senate Bill 45House State Government – Sen. McDaniel’s bill requires disclosure of information related to pensions of current and former members of the legislature.
  • House Bill 238Senate State & Local Government – Rep. Yonts’ bill requires the Public Pension Oversight Board to hire their own actuary to do an actuarial audit of the state-administered retirement systems at least every 10 years and review the retirement system’s budget requests every two years.

Vacant & Abandoned Properties
GLI supports efforts by local governments and developers to return vacant and abandoned properties to productive use and the tax rolls. There are two bills of note:

  • Senate Bill 229Senate State & Local Government – Filed by Sens. Morgan McGarvey, Julie Raque Adams, and Denise Harper Angel, would expand the abilities of land bank authorities to hold, renovate, and lease vacant and abandoned properties if a satisfactory bid is not made at auction.
  • Senate Bill 230House Local Government – Filed by Sens. Morgan McGarvey, Julie Raque Adams, and Dan Seum, would expand local government authority to make spot condemnations and more quickly return vacant, abandoned, and blighted properties to productive use.

Prevailing Wage
GLI supports the repeal of prevailing wage laws and sees these bills as good steps forward:

  • Senate Bill 9 – Voted down in House Labor & Industry – Sponsored by Sen. Schroder would exempt public construction projects of $250,000 or more from the state’s prevailing wage laws.
  • Senate Bill 94Senate State & Local Government – Senator McDaniel’s bill would allow local governments to opt out of prevailing wage for public works.

Public Benefit Corporations

  • House Bill 50Senate Judiciary – Sponsored by Rep. Kelly Flood, Rep. Jerry Miller, and Rep. Steve Riggs, would permit public benefit corporations, which is a corporation that allows a company’s board of directors to take “public benefit” into account, in addition to shareholder benefit, when making decisions about the company. GLI has taken a leadership role in making PBCs possible in Kentucky.

Right To Work – GLI supports this legislation as one of our top priorities.

  • Senate Bill 3Senate Economic Development – Filed by Senate President Robert Stivers, is this session’s Right to Work bill.

Road Aid Modernization

  • House Bill 69House Appropriations & Revenue – Reformulates the road fund revenue sharing to a formula of thirds based on population, road mileage, and land area. GLI supports a more equitable share of road funds for urban areas.

Sick Leave

  • HB 617House Labor & Industry – Filed by Rep. Mary Lou Marzian, would require employers to provide earned paid sick leave to employees. GLI opposes this legislation because it places an unnecessary mandate on employers.

Smoke-Free Legislation

  • House Bill 351House Health & Welfare – Filed by Rep. Susan Westrom, would prohibit smoking in indoor public places. GLI is supportive.

Tax Reform Proposal

  • House Bill 342House Appropriations & Revenue – Rep. Jim Wayne filed this omnibus tax reform proposal that relies on many of the recommendations from former Governor Beshear’s tax reform task force. The bill creates a burden for many industries by placing a personal property tax on manufacturing equipment, retail inventory, and raw materials, including distilled spirits. Businesses operating in other states could be taxed by Kentucky if they are not taxed by the other state, which could create a competitive disadvantage for Kentucky.  GLI is supportive of comprehensive tax reform that is consumption-based and pro-business.  Learn more about our tax reform recommendations here.
  • House Bill 247House Appropriations & Revenue – Sponsored by Rep. Watkins, this bill increases the cigarette tax. GLI believes this would be a positive step to raise revenue for the Commonwealth.

Workers Compensation Subrogation

  • House Bill 200House Labor & Industry – Filed by Rep. Bart Rowland, would clean up statutes related to workers compensation insurance subrogation in favor of employers. This would save employers money and make Kentucky more attractive for business.

Workers Compensation Temporary Total Disability – Two bills:

  • Senate Bill 151 & House Bill 311 both await action in House Labor & Industry – would allow payments of temporary total disability benefits to be offset by wages paid to an employee by an employer for light duty or alternative duty work performed during a period of temporary total disability. GLI supports this legislation.
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