KET Legislative Coverage

EPA Proposals Not Popular in Either Senate Camp

by John Gregory | 06/09/14 2:22 PM

As state regulators continue to sift through the Obama administration’s new, 645-page proposal to limit greenhouse gas emissions, Kentucky’s Senate candidates wasted no time in taking stands against the historic proposal. Those stories headlined this weekend's Comment on Kentucky.

While the Environmental Protection Agency's proposal calls for an overall 30 percent reduction in carbon dioxide emissions from the nation’s existing power plants, James Bruggers of the Louisville Courier-Journal says Kentucky will have to reduce its rate of emissions by 18 percent by 2030. The proposal provides states with options on how to make the proposed reductions, including technical upgrades to power plants, switching coal plants to cleaner-burning natural gas, investments in renewable energy, or initiatives to make homes and businesses more energy efficient. Bruggers attributes some of the plan’s flexibility to Gov. Steve Beshear and Kentucky Energy Secretary Len Peters, who lobbied the Obama Administration for ways to reduce emissions beyond simply regulating smoke-stack emissions.

The coal interests came out strongly against the proposal, alleging it would cost even more mining jobs, especially in Kentucky. Bruggers says the proposed rule could impact the industry but the bigger issue remains competition from lower cost natural gas, which more ulitities are switching to for power generation. At the same time, however, coal would still provide about 30 percent of the nation's power even after the EPA proposal takes full effect.

The Politicians Respond
Sam Youngman of the Lexington Herald-Leader reports the response from U.S. Senate candidates Mitch McConnell and Alison Lundergan Grimes was swift. Both sides are critical of the rule and the Obama administration for proposing it.


Youngman says that since the primary three weeks ago, the media has focused on issues McConnell wants to discuss: coal, Obamacare, and candidate debates. Youngman says Grimes must find a way to set the agenda and tempo of the campaign so as to put McConnell on defense.

Lawsuit Against State Pension System
Ronnie Ellis of CNHI, Inc. reports the financially strapped Kentucky Retirement System is facing two significant challenges: Last week, the northern Kentucky community of Independence sued KRS, alleging illegal and imprudent investing practices. The lawsuit asks the court to prevent the city's contributions from being placed in private equity and hedge funds, and seeks class-action status, which means other communities may be allowed to join the suit.

The situation is complicated for local government employees participating in the system. Ellis explains the subsidiary pension system into which cities and counties contribute has been fully funded and those entities dislike being bogged-down by the liabilities of the full system. Though counties have discussed leaving KRS for years, Ellis says this is the first time a local government has sued the state system.

A more immediate blow to KRS came when a judge recently ruled that the Louisville-based mental health agency Seven Counties Services could leave the system. The organization has filed for bankruptcy and sought to leave the system because of increasing pension costs. Ellis says if other similar social service agencies attempt to leave KRS, the system could be left with an even larger unfunded liability.

Watch the full Comment on Kentucky program to hear more on these issues as well as discussion about the first commercial in the 2015 governor's race and care provided by Veterans Administration hospitals in Kentucky.