Public policy: legislative preview 2022

By Bob Babbage and Julie Babbage

Kentucky will have its third budget in three years after the 2022 session ends, a situation unprecedented for modern times.

Just a few years ago, public budgeting was made difficult by too few financial resources for so many countless needs. Some say budgeting is harder now, with billions freshly printed from Washington, DC The wave of federal liquidity has sparked in-depth analysis of many transformational investing options. The general state fund receives more money each month than originally planned, creating its own surplus.

In October, general fund revenue for this fiscal year was up almost 18% from last year. The challenge is already creating an extra effort for the governor and the legislature.

With John Hicks, the state budget manager, Governor Andy Beshear and his leadership team have a colossal task. The same goes for Budget Chairs Senator Chris McDaniel and Rep. Jason Petrie, two powerful leaders who are overworked to dutifully map out the multibillion dollar spending map.

Budget and policy veteran Senate Speaker Robert Stivers and House Speaker David Osborne always balance multiple interests at the intersection of ideas, realities and aspirations. They understand the full extent of the state’s obligations and potential. When everyone is engrossed in the business of the day, their chairs are taken by Senator David Givens, the pro-tem President, and Representative David Meade, the pro-tem of the House. Each brings a wealth of hard scrabble experience.

Two key men “take the floor,” bringing matters to the examination in the role of majority leader. The orchestration of the upper house is Senator Damon Thayer. Representative Steven Rudy directs the agenda of the House.

Two women hold leadership positions, Senator Julie Raque Adams and Representative Suzanne Miles. Their jobs involve endless conversations aimed at building consensus among GOP lawmakers who hold a qualified majority in both houses.

Senator Mike Wilson also sits on the Senate leadership, where the turning points dictate what gets voted. Likewise, Rep. Chad McCoy is the “whip” of the House, a quaint term for the vote counter.

The House Democrats are led by Representatives Joni Jenkins, Derrick Graham and Angie Hatton. Democrats in the Senate are led by Senators Morgan McGarvey, Dennis Parrett and Reginald Thomas. Despite the overwhelming margins of the GOP caucuses, Democratic votes and votes were essential at key points in the 2021 session.

As these quarterbacks and coaches lead the process, they are joined by running backs in the role of committee chairs. Although budgeting is the first priority, many thematic areas will receive special attention during the 60-day ‘long’ session.

Education concerns are at the fore. A study group comprising members of the House and the Senate has just made important recommendations for school reforms. These include full funding for three areas: full-time kindergarten, a major topic last winter; local transportation costs (think of school buses); and school safety, a constant concern. Added to this list is the state’s SEEK (Support Educational Excellence in Kentucky) funding formula, which some deem unfair. The state constitution and the famous Rose decision impose financial fairness.

The concerns of the signature industry will generate lengthy discussions and even potential internal conflicts. The historic horse racing law was passed in the last session after heated debate, highlighting the sometimes marked divide between urban and rural areas. The bill came out of the House after executives promised to change the pari-mutuel tax structure. The related task force is expected to submit recommendations for changes by the January 4 start date. The next session will also see a series of upgrades proposed for the burgeoning spirits industry.

The problems of financing infrastructure and transport have been resolved. There is an ongoing debate in Frankfort as to whether Kentucky’s obsolete gasoline tax should have been increased years ago. Efforts to increase it have constantly been thwarted. With gasoline costs at the pump, adding even a few cents seems unlikely this session.

Electric cars might see special but modest licensing fees. Why? Funds for road construction come from gasoline pump taxes; electric vehicles circumvent these additional costs. An annual membership fee would make it fairer, the donors argue.

Kentucky’s three major airports — Lexington, Louisville, and Northern Kentucky — have significant growth and funding needs. General aviation airports, as the smaller ones are nicknamed, also have maintenance needs and growing difficulties in places. Adequate funding is complicated, but urgent.

Banking and insurance, the basis of the economy, include aspects that are crucial to the business world, requiring continuous review and updating.
The issues addressed by the health committee are among the most closely watched. This year will be no different, with high-profile topics such as medical marijuana and vaccine warrants already at the center of several pre-tabled bills. Meanwhile, Attorney General Daniel Cameron is challenging federal vaccine mandates on two fronts: government contractors and companies with more than 100 employees.

Expect an ongoing conversation about bonuses for frontline workers employed during the pandemic, a topic of the 2021 special session.

The Republican leadership rejected Governor Beshear’s offer to form a task force, urging the use of the legislative process instead. The Judicial Commission is often the scene of intense debates on law, justice and life itself. The next items on the agenda cover accountability in Kentucky prisons and the continuing debate over whether to make the Supreme Court and Court of Appeals elections partisan.

Ongoing issues to consider: dealing with the opioid crisis as lawmakers seek treatment options rather than criminal penalties; creation of a judicial council serving as an intermediary between higher and lower courts; Following the Breonna Taylor tragedy in Louisville and the recommendations of the No-Knock task force, the legislature will seek to introduce a “riot” bill.

Kentucky’s Environment and Natural Resources Committee will look at the complex science and safeguards as the state attracts significant new investment.

Decisions have yet to be made on how to spend the remaining $ 800 million of Kentucky’s original $ 2.1 billion allocation in the American Rescue Plan Act. Some of it is already allocated to projects like broadband and federal unemployment insurance loans. Other ideas on how to use the remaining funds are launched, including bonuses for essential workers as well as investments in universities and the workforce.

It is estimated that $ 5 billion in infrastructure funds will flow to the Commonwealth once President Biden signs the bipartisan infrastructure bill. The $ 4.6 billion allocated to roads and bridges is a “godsend,” US Senate Minority Leader Mitch McConnell said. Perhaps the long-awaited Brent Spence Bridge updates will end up in the spending spotlight.

State concerns and federal funding could spark a transformative session ahead, with sweeping implications for decades to come.

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