The Richmond Register

April 1, 2013

Basketball tournaments not the only March Madness

By Rita Smart
81st District State Representative

FRANKFORT — All over Kentucky, March Madness is a well-known descriptor of the annual and highly anticipated college basketball tournament.

But in Frankfort, some would say March Madness took over the last week of the legislative session as we raced the clock to find solutions to the public pension problem and a host of other important issues facing Kentucky.

That madness turned to gladness as the House passed House Bill 440 and Senate Bill 2 which will generate revenue, protect retirement benefits for current employees and stabilize the system for the future.

Under House Bill 440, $100 million will be generated to help pay down the liability facing Kentucky’s retirement system for state and local government employees.

The money will come from reducing the state personal income tax credit by $10; enhancing revenue collection by the state Department of Revenue; and reducing the cap on total reimbursement for vendors who collect the state’s sales tax.

There is also a reduction in taxes by offering a trade-in credit for new car purchases as of July 1. House Bill 440 was given final approval by a vote of 82-17 in the House and 35-3 in the Senate.

Going forward, new state and local government employees will participate in a cash-balance plan rather than the existing defined-benefit plan. This will apply to judges and legislators as well. These changes are estimated to save more than $10 billion over the next 20 years.

Senate Bill 2 implements a hybrid plan featuring elements of both defined-benefit and defined-contribution plans. The participants do not own these accounts or make investment decisions, but during their working years, employees will contribute 5 percent of their salary and employers will contribute 4 percent.

Their account balance is guaranteed to grow by at least 4 percent annually. Growth above that will mostly go to the worker, with the state receiving the rest.

Workers will be able to move the retirement funds they have earned and accumulated more easily if they leave public service. The average state worker’s career, for example, is nine years. At retirement, employees can annuitize their account balance and receive it as a lifetime monthly payment.

In addition, the General Assembly will have the ability to offer cost-of-living allowances (COLA) to retirees if money is available and the actuarial cost of the COLA is paid. Senate Bill 2 received final passage by a 32-6 vote in the Senate and a 70-28 vote in the House.

While all of us did not agree on every aspect of the pension legislation, the reality is we had to do something to protect current and future employees and provide a stable, dependable funding mechanism. It is not a perfect plan but after years of analysis, discussion and financial review, I believe we passed the best piece of legislation possible.

We tackled several other issues with great results of which the Kentucky General Assembly and the citizens of the Commonwealth can be proud.

House Bill 290 establishes an independent review panel to investigate cases of child deaths and near-fatal injuries and make records from cabinet and law enforcement officials more accessible.

House Bill 3 strengthens human trafficking laws while protecting victims from prosecution for crimes they were forced to commit. The bill creates a human trafficking victims fund supported by service fees paid by convicted traffickers, proceeds from their seized and forfeited assets, and any grants, contributions or other funds that may become available.

Senate Bill 1 will make the absentee voting process easier for Kentuckians serving overseas in the military. The legislation will allow members of the armed forces, their spouses and others out-of-country to register to vote and request and receive absentee ballots electronically.

House Bill 217 makes adjustments to last year’s Pill Mill Bill by easing reporting requirements for pain medications dispensed for clear and legitimate need; lifts mandatory reporting for hospitals and long-term care facilities, post-surgery patients, end-of-life situations and other patients with undeniable medical need for increased pain management.

Senate Bill 97 allows school districts to increase the compulsory attendance age to 18 beginning in the 2015 school year. Districts are required to have programs and resources for students at-risk of not graduating. The increased attendance age will become mandatory statewide four years after 55 percent of Kentucky school districts adopt it.

Senate Bill 50 creates an administrative framework for farming industrial hemp in Kentucky if the crop is legalized by the federal government or we are granted an exemption. It also increases a research component with Kentucky’s universities and strengthens the role of Kentucky State Police and other law enforcement.

House Bill 1 boosts transparency and accountability for 1,200 special taxing districts by putting rules in place for entities that collect fees for special services such as local water, sewer, and libraries. It creates an online central registry to publicly disclose their annual budgets; requires taxing districts to submit budget reports to fiscal courts; and requires special districts hold a public hearing in conjunction with a fiscal court meeting when considering a new fee or an increase in the existing tax rate.

Senate Bill 13 will allow the sale of alcoholic beverages while polls are open on Election Day.

House Bill 5 creates a process to resolve payment disputes between Medicaid providers and managed care organizations more promptly.

Senate Bill 8 and House Bill 35 requires new school safety laws which includes emergency responders being involved in developing school safety plans.

House Bill 7 gives six Kentucky universities authorization to bond more than $360 million in construction projects; creates thousands of construction jobs; and almost $400 million in economic development.

Most new laws – those that don’t come from legislation with emergency clauses or different specified effective dates – will go into effect in 90 days.

Considering the magnitude of the issues we had to consider during this 30 “short” session, I believe we were able to work in a bipartisan manner to achieve good results.

Like the NCAA’s March Madness, the 2013 legislative session was full of upsets, slam dunks, fast breaks, rebounds and flops. We witnessed the joy of victory and the agony of defeat as legislators poured their heart and souls into bills that they truly believed would benefit Kentucky citizens.

So as the clock struck midnight on Tuesday, March 26, we stood tall, shook hands and headed back to our home courts knowing we’d be back in this arena soon.

Your input has been invaluable this session so please continue to contact me with your concerns and questions.

We will hold committee meetings throughout this interim period and you can check that schedule by calling 800-633-9650. If you would to contact me, please call 1-800-372-7181.

I will be holding town hall meetings this spring to hear your concerns and suggestions for improving our district.