For the past several years the state's lawmakers have had difficulty agreeing on a budget, but State Rep. Rick Nelson, D-Middlesboro, says the process should be smoother this time.
“Now I've always voted for a budget - The House has passed a budget every time, but the Senate has killed it the last two sessions,” Nelson said. “Because of recent court rulings, I think things will run better this time.”
In May, the Kentucky Supreme Court ruled that state money can be spent only on items directed specifically by the state Constitution and Kentucky law, severely limiting a governor's ability to maintain most government functions without a budget.
Still, though they will be working with a projected budget surplus legislators will also have to deal with a Medicaid shortfall and demands to fully fund education, which takes up 61 percent of the total budget. Decisions will be difficult as the governor and lawmakers determine how to spend available funds.
There are nearly 700,000 Kentuckians enrolled in the Medicaid program, which provides health care coverage for the poor, disabled and elderly. The federal government funds 70 percent of the program and states funds the remaining 30 percent.
The state is facing a deficit of as much as $600 million in the Medicaid program for 2006. The shortfall comes from changes in federal rules governing the program and because of higher-than-expected costs.
“Our problem is the exploding cost of healthcare,” Nelson said. “Gov. Fletcher has the ability to make changes to keep it solvent. We're hoping he'll be able to get a waiver that will allow changes to be made in the payment grid.”
These changes would include increasing co-pays on medicine as well as placing limitations on emergency room visits and possibly other services to some.
“That's one of the main cost drivers for the program,” Nelson said about unnecessary ER visits. “I saw a study that identified about 100 people who were responsible for over 10 percent of all ER visits paid for by Medicaid - They're going there instead of just seeing a physician.”
The cost of healthcare is also putting a strain on the benefit plan for state employees.
The plan takes in active and retired state employees and teachers. Nearly 300,000 Kentuckians are included on the pension rolls.
Gov. Fletcher has announced that the health benefit for teachers and state employees will remain unchanged in 2006.
“Over $200 million is going to have to be put in to maintain our current levels of benefits,” Nelson said.
Projections also show the state's retirement system could have major problems as soon as 2009, if more money is not put into the program, Nelson said.
Exactly where these hundreds of millions of dollars are going to come from is the challenge lawmakers face. A starting point is a projected surplus of about $400 million.
“We've got to make sure we're taking in more than we spend, if it's at all possible,” Nelson said. “I'll be fighting to make sure we can keep our share of the coal severance tax money.”
The latest projection for coal severance tax revenues is $649 million. Over half of this goes into the state's general fund, the remainder is divided among the coal-producing counties.
Since 2003 Nelson has earmarked over $3 million for water projects in Bell County through coal severance money.
Over that time Middlesboro and Pineville have receive more cash to be used at their discretion from coal severance money than any cities in the state, and the Bell County Fiscal Court has received more than any other county, according to Nelson.
“When they get extra cash it means they don't have to raise taxes and they can afford equipment and projects that they feel are important to the people in each of those areas,” Nelson said.
Other issues facing the General Assembly include:
Fletcher initiatives. Gov. Fletcher has outlined two major themes his administration will pursue in 2006- Get competitive, Kentucky and Get healthy, Kentucky. The “get competitive, Kentucky” theme will include advancing manufacturing, commercialization and innovation, tourism, and making sure education and training serves the business community. Kentucky ranks third in the nation in its ability to train workers, but only 44th in technology. “We have to take intellectual property and commercialize that; focus on return on investment,” he said. “For every tax dollar we get, how do we get the best value out of it?” The “get healthy, Kentucky” theme touches on education with initiatives to get junk food out of schools and increase physical education. It also includes promoting wellness, Medicaid reform, addressing the 500,000 uninsured Kentuckians, small business medical insurance, and tort (medical malpractice lawsuit) reform.
More restrictions on convicted sex offenders. Several bills have been pre-filed that deal with this subject. Among the changes they call for are having convicted offenders wear special i.d. bracelets, having the distinction included on their drivers licenses, and increasing the distance they would be allowed to live from a school. A Nelson bill would even require an annual printing of convicted sex offenders in local papers. Attorney General Greg Stumbo and Lt. Gov. Steve Pence are working to combine several of these suggestion into one bill that will likely be voted on during the session.
Education. BR 6, introduced by Rep. David Floyd, proposes a constitutional amendment to set state spending on education at least 65 percent of the budget. BR 74, filed by Nelson and others, would remove writing portfolios as part of the required assessment program, requiring the portfolios to be used as instructional tools for continuous assessment. BR 152, filed by Rep. Jim DeCesare, would exempt school construction from prevailing wage regulations. BR 95, filed by Rep. Mike Cherry, and BR 187, by Sen. Julian Carroll, would define and prohibit bullying.
Eminent domain. This issue was brought to the forefront after a local government in Connecticut seized private property that was then turned over to a private land developer. “Kentucky's law is a lot stricter than Connecticut's already,” Nelson said. “Eminent domain can only be claimed for roads or utilities.” But he said some local governments are condemning land that has been considered “blighted.” Nelson has filed a bill that would increase property owners' rights.
All pre-filed legislation is posted on the Kentucky Legislative Research Commission website, http://www.lrc.ky.gov.
Nelson said he would be in Frankfort on Monday through Friday from Jan. 3 through April 15, but would still be available to answer any question or concerns from his constituents at 1-888-887-0088. He can also be reached at home on the weekends at 248-8828.
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