Legislative Update - April 2, 2012

One Day Remains . . .

The General Assembly completed Day 59 of 60 for the 2012 Regular Session on Friday night, marking the beginning of the Veto Recess. Legislators will return on April 12 to finalize their work for the 2012 Session and consider any vetoes. The headlines for the last full week of the session include passage of the State Budget and Senate Bill 3, the anti-meth lab legislation.

We asked last week whether the last full week of the 2012 session would end with compromise or political meltdown of the sort that would keep key legislation from passage. The answer, as it turns out, was some compromise and a moderate meltdown that kept some key legislation from passage, at least before the session’s 60th day. The General Assembly did pass the executive branch budget, House Bill 265, on the 59th day of the session. This occurred after an 11th hour agreement between House and Senate conferees in the wee hours of the morning on March 26. Legislative leadership did not, however, make a similar breakthrough on House Bill 267, the state road plan. Conferees will meet over the veto recess to try to come to an agreement on the road plan.

Similarly, the General Assembly, which dealt with several major bills to combat rampant problems of abuse of legal and illegal drugs, passed some of this legislation while failing to reach a consensus on other legislation.

It has been several sessions since the General Assembly completed its work on the Executive Branch budget on time, during regular session. The legislature gave final passage to the budget bill on Friday, 36-1 in the Senate and 81-7 in the House, sending the bill to the Governor for his consideration. The basic details of the budget are:

•    The $19.3 billion budget cuts funding of most state agencies by 8.4 percent. Some areas received lesser cuts, like universities at 6.4 percent cuts, and some areas, like K-12 education and Medicaid, were held at previous years' levels.
•    No pay raises were granted for teachers or state workers and cost-of-living increases for state retirees is suspended for two years.
•    Adds $73 million to the rainy-day fund and authorizes $390 million of bonded indebtedness, which is $577 million less than the Governor proposed.

The good news for KAM is that the budget was tight and the General Assembly managed it without new revenues. At the same time, though it is good to see the Commonwealth being good stewards of our tax monies, eventually an appetite for new programs and projects will lead policy makers to seek new revenues.

The other issue that has dominated the politics of this session and past sessions is Senate Bill 3, dealing with restricting access to pseudoephedrine products that are used to manufacture methamphetamine. The final version of the bill decreases limits on purchase of pseudoephedrine products, but doesn’t require a prescription. After much compromise between the House and Senate and between regional and partisan factions inside of each Chamber, Senate Bill 3 received final passage last week.

The main items of unfinished business will be the Transportation Budget, highway construction plan and House Bill 4, dealing with “pill mills.”

KAM Issue Update

Since the General Assembly has nearly completed its work for the 2012 session, we wanted to give you a quick update on KAM’s top priorities. Overall, it has been a successful and productive session for KAM.  Several priority pieces of legislation supported by KAM were enacted and some legislation opposed by the organization failed to pass. Here’s a scorecard:

Senate Bill 38, sponsored by Senator Jack Westwood (R-Erlanger), creates career pathways to give our students the career and technical skills that they need to be ready for the workforce upon graduation. KAM has pushed similar measures in the past as one significant way of addressing workforce challenges faced by manufacturers. Passed House & Senate

House Bill 255, sponsored by House Majority Floor Leader Rocky Adkins (D-Sandy Hook), which would provide incentives for more energy-efficient school buildings and incentives for small to medium-sized manufacturing facilities by authorizing the use of industrial revenue bonds to make energy efficient upgrades. HB 255 did pass, but did not contain the energy incentives that KAM was pursuing. Unfinished Business & Top Priority for 2013

House Bill 495, sponsored by Speaker Pro-Tem Larry Clark (D-Louisville), addresses the interest debt to the federal unemployment insurance fund. Kentucky employers owe interest on nearly a billion dollars in loans needed to make unemployment payments from the beginning of the recession in 2007. This is a very important piece of legislation to manufacturers and after much work, this appears to be the only option to repaying the interest. Delivered to Governor

House Bill 358, sponsored by Rep. Melvin Henley (D-Murray), dealing with piping and pressure vessel inspections. This has been a top priority for KAM and the Chemical Industry Council and we worked with an outstanding consortium of interests to get the bill passed. Signed by the Governor

House Bill 465, sponsored by Rep. Fred Nesler (D-Mayfield), will clarify situations in which persons may purchase and develop property contaminated by underground storage tank petroleum, hazardous substances, and non-UST petroleum without liability. Delivered to Governor

House Bill 308, sponsored by Rep. Carl Rollins (D-Midway) addresses the governance of the proprietary school industry. This bill is the culmination of efforts during the interim to address issues raised by a state audit that was performed last year. HB 308 does away with the current Board for Proprietary Education and establishes a state Commission on Proprietary Education to adequately address oversight and regulation of proprietary schools in Kentucky. Delivered to Governor

House Bill 400, sponsored by Speaker Pro-Tem Larry Clark (D-Louisville) would expand the incentives the General Assembly provided for Ford several years ago to make them available for GM and Toyota or other auto manufacturer that would invest $100 million and retain 1000 jobs. Delivered to Governor

House Bill 202 – Sponsored by Rep. Kevin Sinnette - (D-Ashland), for the sixth consecutive year, the General Assembly considered legislation that will establish statutory reimbursement rates for chiropractic services. KAM opposed HB 202, just as we have opposed similar proposals the past five legislative sessions. After being considered in the Senate Banking & Insurance Committee, the Chairman announced that the bill would not be voted in the Senate this session. We appreciate your phone calls and emails to legislators in opposition to HB 202. Failed to Pass

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