Larry Dale Keeling: Gumption + marketing = tax reform

Herald-leader columnistMarch 11, 2012 

FRANKFORT — This and that, the Lost Legislative Session Edition:

Here we go again, folks. Another blue ribbon panel of heavy hitters hiring another consultant to lead them — and the rest of Kentucky — down the road to truth, justice and the American way on the subject of tax reform.

What a waste.

We don't need another expert telling us what anyone who has been paying attention for the past couple of decades already knows. We've studied tax reform in Kentucky more often than the late Gatewood Galbraith ran for public office. And with an equal amount of success.

All we need is the gumption to act on all the past reports that cost taxpayers a pretty penny or three.

You want tax reform? Dust off the report economist William Fox presented to the state in 2002. Or go back even further, to the report another blue ribbon panel of heavy hitters delivered in the mid-1990s. The right answers are all there. Just pick out the appropriate pieces and fit them together neatly. Voilá! You've solved the tax reform jigsaw puzzle.

If you want to spend some money on an expert, spend it hiring someone who has successfully marketed ice at the North Pole to pitch the finished tax reform product to Kentucky voters and, more important, the legislators who supposedly represent them but too often do the bidding of those interests who benefit from the antiquated, inequitable and inadequate tax code we have now.

For several years, the leadership of each legislative chamber has reserved the low bill numbers for their priority issues. This session, each chamber held onto bill numbers 1 through 20 for this purpose.

However, you might say the eyes of both House Democrats and Senate Republicans exceeded their appetites this year. With the deadline for filing new bills now behind us, it appears both of them ran out of priorities before using up all those low numbers.

Sure, Senate Republicans assigned most of these lower numbers to items that are part of the current GOP mantra (such as limiting the state's debt) or addressing serious problems that are non-partisan in nature (such as regulating pain clinics and limiting over-the-counter sales of pseudoephedrine, a precursor in the manufacturing of methamphetamine). However, Senate Bills 12 through 17 wound up being used to make innocuous technical changes or to insert gender-neutral language in existing statutes.

At least, Senate Republicans didn't completely waste any of these perennially coveted numbers. You can't say the same for House Democrats, who never got around to filing bills carrying the numbers 3, 6 through 9 or 11 through 20.

Oh, well, when you spend half the session wandering dazed through a redistricting wilderness, it's easy to lose sight of your priorities.

For the past five years, Rep. Bob Damron filed legislation that would allow state universities to issue their own bonds if there is a dedicated revenue stream to cover the debt payments. Bonds issued in this manner would not count toward the state's General Fund bonded indebtedness. This was such a no-brainer idea the legislation passed the House each of those years, the last four by a unanimous vote. But it never got a hearing in the Republican-controlled Senate.

Damron, the majority caucus chairman in the Democratic-controlled House, didn't introduce the bill again this year. "I just got tired of filing a bill, taking it down to the Senate and not even getting the courtesy of a discussion," he said on the House floor Wednesday during debate on the executive branch budget.

If the Senate had passed this legislation five years ago, or even last year, the $451 million in bonds for university projects the House cut from the budget due to concerns over rising state debt wouldn't be an issue this year. All of those projects would have had dedicated revenue streams and wouldn't be considered part of the state's debt.

The ultimate irony is that the Senate recently passed a bill designed to cap the General Fund's annual debt service at 6 percent of total revenues, and — wait for it — this bill would exempt those very same university bonds with dedicated revenue streams from counting toward the General Fund bonded indebtedness.

Alas, Senate Republicans' conversion on this issue apparently comes too late to save the $451 million in university projects. (I used the caveat "apparently" because the miracle of resurrection is a daily, sometimes even hourly, event during legislative sessions.)

But the irony of this apparently too late conversion on a no-brainer issue does help explain why observers of the legislative process can feel a daily, sometimes even hourly and maybe even minutely urge to scream and pull out the nearest legislator's hair.

My rudimentary math skills tell me the 1,127 Kentucky Colonel certificates Secretary of State Alison Lundergan Grimes has issued (many of which went to campaign contributors) since being sworn into office Jan. 1 average out to about 16 a day, Saturdays and Sundays included.

You can't fault her work ethic.

Reach Larry Dale Keeling at lkeeling@herald-leader.com.

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