What You Need to Know, Week Eight – Regular Session (2018)KAM
Pension Reform Bill Introduced
The long-awaited public employee pension reform legislation was introduced last week in the Senate. Pension reform has been a topic of conversation dating back to the previous session. We expected Governor Bevin to call a special session during the Interim to address the issue. However, after a draft proposal was released last fall, it became clear that there was not sufficient legislative support to pass reforms that included a move from a defined benefit plan to a defined contribution or 401K type plan, a three-percent contribution for retiree health insurance, and other controversial changes. After months of work to address some of these concerns, Senator Joe Bowen filed SB 1.
Some of the changes included in SB 1 include the following:
- Eliminate the unfunded liability, projected to be anywhere from $40 billion to $60 billion;
- Save more than $4 billion over 20 years;
- Move new teachers into a hybrid cash balance plan, similar to action taken with state employees during the 2013 reforms;
- Reduce the cost of living adjustments for 12 years for retired teachers;
- Require school districts to contribute 2% of payroll for new teachers into the cash balance retirement account;
- Place restrictions on how sick time can be used to boost retirement; and
- For state employees, remove the guarantee of a return and replace with a pledge that accounts will not lose money.
It does appear that education and state employee groups continue to have concerns with this new proposal. The Senate plans to take action on SB 1 this week.
Budget – House Proposal Coming
While the Senate focuses on pension reform this week, the House will have their attention focused on consideration of the biennial budget bill, HB 200. Last month, Governor Bevin introduced the budget document and since then the House, through their Appropriations and Revenue committee process, has been reviewing the bill and hearing testimony from state government agencies and others impacted by the proposal. We expect the House to present their changes to HB 200 this week, with the intent of holding a floor vote by March 1. KAM will monitor this process and continue to advocate for the $100 million workforce investment bond pool included by the administration.
KAM Priority Bills are Moving
The following priority bills saw action last week:
HB 2 – Rep. Adam Koenig’s comprehensive reforms to the state Workers’ Compensation system cleared a significant hurdle last week, as it passed the House floor by a vote of 55-39. The bill is now in the Senate where it will go through the same process as in the House – a committee hearing and then a vote on the Senate floor. While changes to HB 2 addressed concerns of the KY Professional Firefighters Association, the Fraternal Order of Police continues to oppose the legislation. HB 2 is a priority for KAM, and we ask that you reach out to your state senator and ask that they vote YES on this critical measure.
HB 252 – Another essential reform measure that received action in the House this week was HB 252, sponsored by Rep. Jim DeCesare. HB 252 reforms the state’s unemployment insurance system to better align with surrounding states. The bill passed in the House Economic Development and Workforce Investment Committee this week. There were two changes incorporated into the final version. The first change reduced the quarterly base period wages from $2000 (included in the original language) for $1500. The second change begins the weekly benefit at 16 weeks if the unemployment rate 5.9% or below. The original language was 14 weeks with a rate of 5.4%. Several unfriendly floor amendments were filed to the bill. We encourage you to contact your state representative and ask that they YES on HB 252.
HB 324 – For several years, KAM has worked to pass legislation that will protect critical infrastructure in the state, like our chemical plants, from the unregulated use of drones around these significant infrastructure assets. HB 324, sponsored by Rep. Diane St. Onge was heard in the House committee this week and passed the committee overwhelmingly. The bill will now go to the House floor for a vote. Please continue to encourage your state legislators to vote YES on this KAM priority legislation.
Bills That Are Good For Kentucky Manufacturers
HB 227 is legislation sponsored by Rep. Jim Gooch to address inequities in how renewable energy users receive credit for excess energy that they produce. Currently, all other users subsidize users of renewable energy, like those with solar panels. HB 227 could be called for a vote on the House floor this week. KAM supports HB 227, and we encourage you to contact your state representative and ask that they vote YES on HB 227.
HB 370 is legislation sponsored by Rep. Robby Mills to update the state’s brownfields statute to make the program more accessible and simpler for property cleanup. This bill is a product of compromise between KAM, the administration, and environmental interests. It will be heard for a vote in the House Natural Resources and Energy Committee this week. Please contact your state representative and ask that they vote YES on HB 370.
SB 160 is legislation sponsored by Senator Rick Girdler to modernize the statute which prohibits “grossly excessive” price increases by sellers of goods and services during a state of emergency declared by the Governor. SB 160 amends the 14-year-old statute to better align with pricing laws that have proven to be effective in other states. The bill retains provisions to strictly prohibit and penalize grossly excessive price increases during a declared emergency while adding language to recognize the usual and customary functioning of free enterprise and competitive markets. SB 160 will be heard in the Senate Economic Development, Tourism, and Labor Committee this week. KAM supports SB 160, and we encourage you to reach out to your state senator and ask that they vote YES on SB 160.
Keeping You Informed
As in past years, we will continue to communicate with you weekly with bill tracking lists on the KAM Homepage (Bill Tracking), summaries of legislative actions and dynamics, and specific bills of interest. We will also, of course, contact you immediately as issues of particular interest or concern arise.
We have resumed our KAM Conversation Conference Calls on Thursdays, and invite KAM Members to call and take part in this dialog every Thursday during the 2018 Legislative Session. The information for the call is:
- Call-in Number: 877-746-4263
- Participant Code: 0219774#
Calendar & Key Dates
Two major milestones on the 2018 legislative calendar will be reached this week as it will contain the last days to file new House and Senate bills. You can access the session calendar HERE and the committee meeting schedule HERE. Please keep in mind that this calendar can change if the legislature decides to shift days. We will let you know if that happens; however, they must adjourn by April 15, according to the Constitution. Below are specific dates of interest:
- February 27 – Last day for new House Bills
- March 1 – Last day for new Senate Bills
- March 27-28 – Concurrence Days
- March 29-April 9 – Veto Recess
- April 13 – Sine Die
Meet the KAM Governmental Affairs Team here.
Don’t know who your elected representatives are? Click here to reach the Action Center of the Kentucky Prosperity Project to find this and other important information to help you make your opinion heard on matters affecting you and your business! You can also purchase a Kentucky General Assembly Blue Book from KAM, or purchase the companion KAM Blue Book App for Apple and Android products from their respective app stores.