Chamber legislative preview

Kentucky Chamber of Commerce Senior Vice President of Membership and Development Kelly Wolf, left, speaks with Chris Wooldridge, right, the director of the Kentucky Small Business Development Center at Murray State University, after a legislative session preview breakfast Friday. Also pictured are CFSB's Aaron Dail and Amy Cloud, the executive director for the Kentucky Chamber of Commerce Executives.

MURRAY — Representatives of the Kentucky Chamber of Commerce met with local chamber members in Murray Friday morning to discuss priorities for the upcoming legislative session in Frankfort.

Kentucky Chamber President and CEO Dave Adkisson was present, along with Senior Vice President of Membership and Development Kelly Wolf and Amy Cloud, executive director for the Kentucky Chamber of Commerce Executives.

Murray-Calloway County Chamber of Commerce President and CEO Michelle Bundren welcomed attendees and outlined some of the local chamber’s hopes for the 2019 General Assembly before introducing Adkisson. Bundren said Thursday’s news that $23 million would be awarded to Calloway County through the federal Better Utilizing Investments to Leverage Development (BUILD) program in order to widen U.S. 641 South was a big win for Murray and Calloway County.

Bundren said the local chamber board was also happy to see the Tennessee Valley Authority in-lieu-of tax bill pass in Kentucky’s last legislative session, and members are hoping to see that money used for local economic development soon. Moving forward, the chamber wants to support Murray State University in any way they can, and they also support Gov. Matt Bevin’s Red Tape Initiative to eliminate more regulations for businesses.

Bundren said the chamber also wants to continue to support the Agriculture Development Fund and to promote industrial hemp as much as possible. She also mentioned that the chamber was lobbying to have non-profit organizations exempt from Kentucky’s recently enacted sales tax on services.

Citing a cold and a hoarse throat, Adkisson let Wolf do most of the talking Friday’s breakfast at the Marriott SpringHill Suites. Wolf talked about some chamber priorities that had been achieved in Kentucky since Republicans won a majority in the House of Representatives in 2016. In the 2017 session, the General Assembly passed right-to-work legislation and repealed the prevailing wage law. It also created medical review panels, voted to allow charter schools and to require “pension system transparency,” Wolf noted.

For 2018, Wolf highlighted the passage of pension reform and a tax reform law that moved Kentucky from the 39th best business tax climate in the country to 23rd, according to the Tax Foundation’s 2019 State Business Tax Climate Index. She said the legislature also passed a worker’s compensation law that will save businesses around 10 percent, as well as a law seeking to ensure that Kentucky students learn about “essential employment skills.” Also known as “soft skills,” they include showing up for work on time, dressing properly for interviews and for work, passing a drug test and working well in teams, among other attributes. Medical peer review was also passed this year, she said.

The upcoming 2019 General Assembly is a short, non-budget session, and Wolf said the state chamber’s priorities include investing in Kentucky’s infrastructure, improving the tax code, reforming the state’s bail system, improving the legal liability climate, enacting sports wagering, modernizing unemployment insurance, ensuring affordable energy resources, implementing tobacco-free schools legislation and encouraging a competitive business climate to motivate broadband deployment.

“Obviously (with the short session), we won’t be talking a lot about big budget issues that are going to have an impact, but we will be having a discussion on infrastructure because good infrastructure is key to a good business climate,” Wolf said. “We must invest in infrastructure to continue to be competitive. The road fund is obviously lagging and if we don’t do something about the road fund, we’re going to lose millions in federal dollars. So that is something that has to be addressed very soon.”

Wolf said additional tax reform is also something the chamber will be pushing. She said there could be small tweaks – including the taxes on non-profits that Bundren mentioned – but since it is not a budget year, there probably would not be a big tax reform package passed, and new revenue for the state seemed “highly unlikely” in 2019.

Regarding bail reform, Wolf said the state chamber held a policy preview session last week in which John Tilley, secretary of the Kentucky Justice and Public Safety Cabinet, and some other panelists talked about the issue.

“(It’s important) to not just focus on the financial means of a low-level offender (but instead) to focus on the offender and the offense,” Wolf said. “It’s something Kentucky really needs to address. We have spent over $123 million in 2016 on low-level crimes because these offenders could not afford to pay bail. So that’s something the Kentucky Chamber feels we do need to address because it is a revenue issue, especially for counties.”

Wolf said education progress has also plateaued in the state, largely because funding has been flat since the recession of the late 2000s.

Adkisson said that in a short session, sometimes lawmakers can get more done since they don’t have to worry about passing a budget. However, a lot will depend this year on the pending Kentucky Supreme Court ruling on whether or not the pension bill was passed improperly after being attached to a sewer bill and failing to receive three readings. That decision could come as early as Thursday, he said.

“If I were a Supreme Court justice, I would say, ‘Yeah, the process was ugly. We’re not going to let you do that anymore, but we’re not going to overturn every law that was ever passed that way,’” Adkisson said, later adding, “We are not defending the process; what we are more interested in is the content of that bill.”

Adkisson said there were a few facts about the pension bill that did not get much attention during the controversial process of passing it because of high emotions on both sides. He asserted that the bill barely touches current teachers, although it does make some changes in how they can use accumulated sick days.

Adkisson said that currently, a teacher can retire after 27 years of service, which means that someone could theoretically retire as young as 49 years old if they were hired when they were 22. The current bill – set to take effect Jan. 1 if the court rules in its favor – follows the “Rule of 85,” which means teachers could collect their pension benefits if the age they were hired and their years of service equal a total of 85. This means a 22-year-old could work until they were 54 1/2 or could retire earlier but wait a few more years to draw their benefits, Adkisson said. 

Adkisson said he believed there were a couple of reasons that neither supporters of the pension bill nor the Kentucky Education Association brought up that part of the bill. He said Bevin likely didn’t mention it because emphasizing that employees would have to work longer or wait to draw their benefits would have made teachers even angrier. Adkisson said those who opposed the bill probably didn’t bring it up because many voters working in the private sector might not be sympathetic to the idea that waiting until the age of 54 to retire was a hardship.

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