5 key stories to follow as the Kentucky state legislature starts its session
The General Assembly is upon us.
This year’s 30-day session, or ‘short session’ as opposed to even-numbered years’ 60-day sessions, began Tuesday. While the state’s political attention is shifting toward the 2023 governor’s race – a crowded Republican May primary before the winner takes on Democratic Gov. Andy Beshear – there are still laws to pass.
The flow of statehouse legislation this year, even more so than in years’ past, will be controlled by Republicans. The GOP outnumbers Democrats 80-20 and 31-7 in the House and Senate, respectively, after the results of the 2022 state legislative elections.
Compared to last year – where big GOP priorities including lowering the income tax, restricting abortion further, getting its own budget bill passed, cutting unemployment insurance and creating a funding mechanism for charter schools, among other initiatives – this year’s session is likely to be quieter. But only time will tell.
Here are five stories we’re watching as the legislature gavels in.
A tax cut is (likely) coming. But what about the timing?
Republicans in the legislature are giddy about the prospect of lowering the personal income tax for Kentuckians, which they say will bring more jobs, people, and economic activity into the state.
Due to language in their initial bill that paves the way to get Kentucky’s income tax from 5% to zero, the legislature is required to take action to cut the state’s rate from 4.5% (it just dropped from 5% as of Jan. 1) to 4%. Per last year’s bill, they’ll need to act to affirm any cut, only allowed if the state’s coffers hit certain triggers, by an increment of 0.5%.
Barring a major change in course, this drop will happen. Rep. Jason Petrie, R-Elkton, filed a bill affirming the initial cut as well as the cut to 4% as House Bill 1, an honor often granted to consensus high-priority legislation of the Republican supermajority. One thing to look out for, though, is the timing. While the House has said they’ll pass something in the first week, the traditionally more deliberative Senate has indicated that they will take some time to give it final passage in February, once the legislature returns from its multi-week break after this week.
It’s unclear if this means that the Senate is thinking hard about the material impact of the tax cut, or if they’re just waiting to milk the news cycle for final passage in February.
Several groups, led by a progressive-leaning think tank in the Kentucky Center for Economic Policy, have criticized the tax cut impact for helping the state’s wealthy high-earners who save much more money when income tax goes down more than its middle- and low-income families and individuals. They also say it could ‘blow a hole’ in the state’s budget and leave it unable to properly fund basic government services. Still, Republicans have been pretty unanimous in praising the move so far.
The state of the state’s budget is strong right now, with actual year revenues far exceeding forecasted ones. The state’s General Fund in Fiscal Year 2022 grew by an impressive 14.6%, all the way up to $14.7 billion. This cushion could prove reason enough for the sometimes more cautious Senate to move forward.
Making Andy Beshear look bad
It’s safe to say that many of the state’s top Republicans share one item on their New Year’s Resolution lists: making Andy Beshear a one-term governor.
The state legislature can play a major role in shaping the political discussion, and putting Besher on the hot seat, if it so chooses.
Last session we saw several bills passed, which were then vetoed by Beshear, that Republicans have used to bash the governor. Chief among them last session was the bill banning transgender women and girls from women and girls’ sports.
“Is this what Andy Beshear means by Team Kentucky,” the Republican Party of Kentucky tweeted after Beshear’s veto, placing his face alongside a photo of transgender college swimmer Lia Thomas’ tying finish with University of Kentucky swimmer Riley Gaines.
Don’t be surprised to see Republicans to take a similar tack on one or more hot button social issue – one like transgender athlete participation, where they feel they have a majority of Kentuckians’ support, could be an option as a bill barring transgender youth from using the bathroom that corresponds with their gender identity has already been filed. Such initiatives could force a veto from Beshear, which Republicans could then try to hold over his head come Fall of this year.
On a similar note, be on the lookout for this buzzy phrase in conservative circles: parental rights.
What this will mean exactly is unclear. Could we see something similar to Florida’s so-called “don’t say gay” bill, which was actually titled the Parental Rights in Education bill? That bill prohibited “classroom discussion” on sexual orientation or gender identity from kindergarten through to third grade and also prohibited schools from adopting procedures to maintain the confidentiality of a disclosure by a student regarding their sexual orientation or gender identity.
While the state’s well-documented teacher and school staff shortage will likely be a primary topic for education-minded legislators and advocates, a hot-button social issue like parental rights, in whatever incarnation it takes, could put pressure on Beshear. Education was a top issue for the governor’s 2019 win over former governor Matt Bevin, and Republicans could see a bill like that as an opportunity to flip the script.
Another area where we’ve already seen some Republicans bash the current administration is juvenile justice. Beshear and Republicans in the legislature agree that the system is in crisis and needs help – the administration has already taken some action to combat high rates of assaults, sex offenses, riots and escapes in the facilities that house youths serving sentences.
The legislature could try to address the issue while also scoring political points against Beshear by holding more hearings about the system.
Will the Senate change its mind on weed or sports betting?
Legalizing medical marijuana and sports betting were two measures that earned relatively smooth passage in the House last year but failed in the Senate.
The Senate’s GOP caucus now has six members, and some of them support both initiatives. The question is whether the math has changed enough for GOP leadership to get the bill through a committee and onto the floor for a vote.
These are initiatives that many believe poll well in Kentucky, and that have the strong support of Beshear. Republicans might be leery of appearing to give Beshear a legislative ‘win’ in this capacity as a result of the 2023 election looming.
On medical marijuana, the legislature just passed a bill last session funding more research of the drug at the University of Kentucky – that could be justification enough to hold up full legalization until the research gets published.
As for sports betting, some question if the new sponsor of the bill will have the same connections and verve as former representative Adam Koenig, a northern Kentucky legislator who was ousted by a ‘Liberty’ Republican in a 2022 primary.
Another proposal that stopped in the Senate last year was a bill banning so-called ‘gray machines.’ If you’ve been to a gas station – or even just existed in Kentucky – over the past year and a half or so, you’ve probably seen a gray machine.
Burning Barrel by Pace-O-Matic is one of the more prominent brands of gray machines gracing the walls of convenience stores, gas stations, and Fraternal Order of Police lodges across Kentucky. A bill last year that would have banned the machines passed the House.
Given that members of the legislature have had more time to develop opinions on the topic, there could be majority support on either regulating or banning the industry – the horse industry is strongly opposed to the machines while the companies themselves want to be regulated by law.
Will the budget be opened up, potentially for Eastern Kentucky?
Though some in leadership have said they don’t want to open the budget up and reallocate dollars divvied up in the last session’s big budget bill, many in Eastern Kentucky say more money is needed to recover from devastating floods that occurred this past summer.
The region received $213 million in state funds as the result of an emergency session called over the summer, but even then some legislators like Sen. Brandon Smith, R-Hazard, were asking for more due to the widespread property and infrastructure damage.
Rep. John Blanton, R-Salyersville, carried that legislation through the House and said that he’s hoping to get $150 million more for the region, potentially from the state’s Budget Reserve Trust Fund, also known as the Rainy Day Fund. One potentially confounding factor is that the relative health of the Budget Reserve Trust Fund is a criteria for reducing the state’s income tax by more 0.5% increments as the years go by.
One idea, spearheaded by Federation of Appalachian Housing Enterprises, Inc., or FAHE, and the Homeless & Housing Coalition of Kentucky, is to create an emergency recovery trust fund for housing, with an initial appropriation of $150 million in 2023 and another $150 million in 2014, along with $115 million in 2024 for the state’s Affordable Housing Trust Fund.
This discussion, if advanced, could also raise questions about the adequacy of funds allocated for Western Kentucky in the wake of historic tornadoes that saw a greater loss of life than Eastern Kentucky. The region received $200 million near the beginning of last year’s regular session.
In its first day, the House signaled potential support for a measure that would open up the budget somewhat to provide funds for the Bowling Green Veterans Center, a bill sponsored by Rep. Michael Meredith, R-Oakland. Meredith’s bill was filed as House Bill 2, another position often granted to high-priority legislation among the majority caucus.
Will this short session be short on noise?
Ask some of Kentucky’s legislative leadership and they’ll tell you the intention of this year’s 30-day session is to actually keep it short
But, as is the case every year, legislators will be pulled in several different directions by constituents as well as lobbyists representing industries and companies looking to get a leg up in Kentucky.
In recent short sessions, a lot of noise has been made.
2017 was a frenzy of Republican activity since it was the first time the GOP held total control over both legislative chambers in ages. 2019 saw former governor Matt Bevin push major pension legislation through the legislature. In 2021, lawmakers were focused on responding to the COVID-19 crisis as well as sparring with Beshear.
At a legislative preview held by the Kentucky Chamber of Commerce, the state’s top lobbying group, Senate Majority Leader Damon Thayer, R-GEorgetown, said to expect less from legislators this year.
“I think we need to go back to the original intent of the short session: not to pass a lot of bills,” Thayer said. “… Here’s where I am: no constitutional amendments, do not open the budget, do not open the road plan. The main focus is on tweaking, making adjustments to bills that have already passed.”
So far, we’ve seen two areas where some GOP legislators are pushing for the budget to be opened. One is to potentially address the well-documented issues surrounding juvenile justice. The other is Eastern Kentucky flood recovery. Only time will tell if extra money from the state’s overflowing coffers will be allocated to either.
This story was originally published January 3, 2023 at 10:20 AM.
