House Bill 4, the budget bill, largely follows the original proposal put forth by Governor Beshear and adds language on certain economic development projects.
While most executive branch agencies would be cut by 2.6 percent, K-12 SEEK funding, colleges and universities, and local jail funding will be kept constant. The state’s Medicaid program will also be fully funded, while the governor’s proposal to require state employees to forgo some holiday pay was removed.
The plan also increases funding to county attorneys, Commonwealth’s Attorneys, and public defenders, whose expenses are largely personnel-driven. County PVAs, another office whose spending goes mostly to salaries, are forbidden from being cut, while state parks received a boost of $4.9 million.
Finally, the bill approves a 1,550 acre site in Hardin County to be used for a proposed advanced battery plant.
House Bill 3 dealt with creating a funding mechanism for mega-transportation projects between Indiana and Kentucky and various economic incentives, tax breaks, and tourism provisions including a motor vehicle use tax incentive that would only tax car buyers on the difference between a new car purchase and the owner’s trade-in, loan support for certain economic incentive projects, and an extension of tourism development incentives.
Other provisions in the bill include incentives for reinvestment in existing manufacturing facilities, streamlining of business incentives while creating new jobs, increasing the cap from $3 million to $5 million for historic preservation projects, incentives to draw film and Broadway play productions to the Commonwealth, incentives to attract a NASCAR Sprint Cup race to Kentucky Speedway and the Breeders’ Cup to Churchill Downs, small business tax credits and income tax incentives for railroad improvement and transport, and a tax credit of up to $5,000 for new home buyers, capped at $25 million.
One of the happier items I am pleased to report is that after several years of effort, we were able to get the House on board with tax relief for military families. Pay for active military duty will now be free from state income tax — a small sum in the overall state budget, but a real boon to military families that are already sacrificing so much for our freedom and well-being.
The one item left unresolved is a plan to help our horse industry. We can all agree that we must protect Kentucky’s signature industry, but the debate over how to do that remains ongoing. The bill that was offered in the House to allow slots at tracks only would have created a monopoly for certain individuals who already have gaming licenses and wouldn’t have allowed for legitimate local development. In addition, there was no local input in terms of locations. Contrary to Governor Beshear’s promise to allow the people to decide, he attempted to push it through the House in a Special Session that was supposed to be about a budget “crisis,” without prior notice, without a constitutional amendment, and refusing to consider other options such as the one that passed the Senate unanimously that would have protected purses without the expansion of gambling. I am personally opposed to the expansion of gambling but I am a strong supporter of the horse industry. Now that Speaker Stumbo has said that he will not be exposing his members to another gambling vote, perhaps we can focus the discussion about protecting our horse industry on practical solutions that are fair, transparent, and democratic.
Overall, we have had a productive special session and we will now return to the regular schedule of interim committee meetings in Frankfort as we prepare for the issues coming up in the 2010 General Assembly Session slated to begin in January.
Senator Brandon Smith (R-Hazard) serves as the Vice Chairman of both the Natural Resources and Energy Committee and the Transportation Committee. He is also a member of the Appropriations and Revenue Committee, the Banking and insurance Committee, and the Program Review and Investigations Committee. He represents the 30th District including Perry, Leslie, Harlan, and Bell counties.
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