By Ronnie Ellis
CNHI News Service
House Democrats are looking at using any growth revenues from the KEES scholarship program and taxing lottery tickets to pay for increased state employee pension costs.
The Republican-controlled Senate has passed a bill to shore up the pension system and stating the legislature’s “intent” to fully fund the annually required contribution to the system — estimated at about $327 million next year — but did not say where the money will come from.
Gov. Steve Beshear and House Speaker Greg Stumbo, D-Prestonsburg, have said they want to see a specified funding source before approving the Senate bill.
But Beshear also told lawmakers during his Feb. 6 State of the Commonwealth he would not agree to fund the pension system at the expense of education funding — which seems in conflict with what Yonts is proposing.
Yonts said Friday his committee will take up the pension bill at a special noon meeting on Tuesday when a committee substitute to the Senate bill will be adopted.
He said that substitute will include an identifiable funding source and he listed some likely proposals: applying the 6 percent sales tax to lottery ticket sales; directing the lottery corporation to expand its game offerings to the public; and using any growth in KEES money and needs based scholarship funds above the 2012 level for the pension contribution.
The funding proposal, Yonts said, will be in a separate revenue bill and will be considered by the House budget committee.
House Democrats plan to caucus Monday to discuss the various proposals.
Yonts said the revenue proposals seem “the most palatable in a non-budget year that would produce the required 60 votes for a revenue package.”
“We’re not taking away from education programs — we’re holding them harmless to the current level,” Yonts said in response to a question about contradicting Beshear’s position on education funds to fund the pension fix.
“I have not talked to the governor, but this is an issue that has been vetted with the (House) leadership and that’s the direction we currently intend to go in,” Yonts said.
Beshear again said he is unwilling to fund the pension system with money needed for education.
“It’s helpful to have continuing dialogue about options for funding state needs, including the pension shortfall, and I appreciate Speaker Stumbo’s efforts to look at many different solutions,” Beshear said in a statement.
He said the state must create a funding source to fund the pension system needs.
“We’ve already cut $1.6 billion from our state budget in the past five years, and I’m not willing to fund the pension program by carving money out of crucial services like education. I’m looking forward to continuing the dialogue,” Beshear said.
Yonts said the revenues being discussed will, “over time,” be enough to fund the annual pension contributions.
Doing that will allow lawmakers to fund the pension system as the Senate bill proposes and still allow the legislature to look at alternatives in the next session which then might allow all the KEES money again to be devoted to scholarships.
Yonts said House Democrats are trying to find a way to avoid “taxing people to fix the pension system.”
He conceded an argument that using KEES funds might be viewed as a tax on those in college or with children in college or that taxing lottery tickets might fall disproportionately on lower income groups.
Those are valid arguments, Yonts said, “but the question is do you want to tax things that may inhibit the growth of business? We don’t want to do that because we’ve got to have business income in this state to make revenue streams otherwise grow so maybe we divert this attachment of the lottery temporarily we hope.”
Yonts said he thinks at least some House Republicans will support the measure.
By Ronnie Ellis
- State News
Republicans eye House takeover in ‘14
The 2014 U.S. Senate race for the seat now held by Republican Mitch McConnell may be the most important in the nation, but it might be the second-most important election inside the state.
Kentucky Power seeks to withdraw rate increase
Kentucky Power is asking the state Public Service Commission to withdraw its June request for a base rate increase to recover costs associated with its purchase of half interest in a West Virginia power plant.
Matt Bevin makes it official
Matt Bevin, the Louisville investment manager who’s trying to lead a Republican primary insurgency to topple incumbent U.S. Senate Leader Mitch McConnell, said Friday those seeking change in the Washington must change who they vote to send there.
Request for Big Sandy Plant rehearing denied
Kentucky’s Public Service Commission has rejected the attorney general’s request for a rehearing on its earlier decision to allow Kentucky Power Company to purchase half interest in a West Virginia power plant.
Governor’s son running for attorney general in 2015
Following months of speculation as he attended political events around the state to shake hands and meet potential supporters, Andy Beshear, son of Gov. Steve Beshear, announced Thursday he will run for attorney general in 2015.
McConnell, Grimes volley over coal issues
When they aren’t arguing about the new healthcare law or where the other raises money, likely foes in next year’s U.S. Senate race, incumbent Republican Mitch McConnell and Democrat Alison Lundergan Grimes, argue over who is the biggest supporter of the coal industry.
McConnell calls Obamacare ‘monstrosity’
Republican U.S. Sen. Mitch McConnell on Tuesday called the Affordable Care Act — or Obamacare — “a monstrosity,” demanding its full repeal during a press conference he called specifically to talk about the law.
Federal court lets latest legislative maps stand
A three-year battle over how to draw new state legislative lines has apparently come to a close as a three-judge federal panel issued its final order Thursday.
Group to map out economic future for Eastern Kentucky
Amid lost coal jobs and a bleak economic future facing Eastern Kentucky, Democratic Gov. Steve Beshear and Republican Congressman Harold “Hal” Rogers announced the formation of a strategic planning group to map out a future for the region.
Grimes energizes Dems in Marion County
There’s a bounce in the step of some Kentucky Democrats these days that has been missing in recent federal campaigns.
- More State News Headlines
- Republicans eye House takeover in ‘14