In his State of the Commonwealth address on Jan. 7, Gov. Steve Beshear dramatically illustrated just how far Kentucky has come since he took office in December 2007, when the full force of the financial crisis was beginning to hit the state.
“People were losing their jobs, health care, confidence, and hope,” Beshear recalled. “Kentucky was broke and broken.”
In his eighth and final Commonwealth address to a joint session the General Assembly, Beshear went on to tout the state’s recovery: an unemployment rate that is down to 6 percent from a recession-era high of nearly 11 percent; manufacturing, service, and technology projects that will create some 15,000 jobs and more than $3.7 billion in investment; and record-setting exports.
“This past summer the Federal Reserve officially declared that Kentucky had more than recovered all of its losses from the Great Recession,” Beshear told legislators.
Building a Stronger Economy
Despite the positive momentum, Beshear said the state is not as competitive as it should be, and many Kentuckians still lack financial security. He devoted a significant portion of his address to his plan for developing a stronger business and workforce climate in the state.
“Kentuckians are industrious," Beshear said. “But you and I also know that our workforce has not been as trained, educated, healthy and drug-free as it needs to be.”
The governor laid out a four-part strategy to address these deficiencies, starting with the youngest Kentuckians. He called on legislators to boost accountability and transparency of child care facilities. For older students, Beshear wants to implement recommendations from the Dual Credit Task Force to help people earn college degrees faster and for less cost.
Beshear says Kentucky’s perpetual health issues lead to lower employee productivity and higher medical costs for employers. To promote healthier workers, Beshear asked legislators to pass a statewide smoking ban in public places. He says new polling shows two-thirds of Kentuckians and 90 percent of state Chamber of Commerce members support a smoke-free law. The governor also called for legislation to address the heroin epidemic in the commonwealth. That would expand treatment options and access to drugs to reverse the effects of overdoses as well as stiffen penalties for heroin traffickers.
Finally, Beshear called for legislation to allow public-private partnerships (P3) for transportation projects; local-option sales taxes for community infrastructure projects; measures to make it easier for disabled veterans to start businesses; and measures to make it easier for offenders who have completed their sentences to get jobs. He also urged a plan for ongoing economic development efforts in Appalachia.
Health Care Reform
The governor took the opportunity to praise the results of the Affordable Care Act, which he has championed, and the state health exchange, Kynect. Beshear labeled the ACA a “transformative solution” to the commonwealth’s health challenges despite the lingering partisan fighting over the legislation.
“You can argue the politics, but you can't argue the results,” Beshear said. He noted the more than 500,000 Kentuckians signed up for coverage during the first enrollment period, and the thousands more who have joined in the current period.
To counter his critics who argue the commonwealth can’t afford its share of the expanded Medicaid expenses in the coming years, Beshear said the state has hired the Deloitte accounting firm to analyze the issue. He explained that preliminary results from Deloitte show 5,300 new health-related jobs were created in the commonwealth in the past year, and hospitals saw $450 million in new Medicaid revenues. The governor contends those gains and subsequent increases should offset the increased Medicaid costs that state government may face.
Other Items on the Legislative Wish List
Beshear urged lawmakers to finally offer protections to individuals in dating relationships. He said Kentucky is among the last states not to provide domestic violence protection to dating couples, especially for young women and the elderly.
The governor also called for legislators to bring the state’s child booster seat law in line with federal recommendations. He said that would protect more children from traumatic injuries due to improper seat belt placement.
Two legislative items noticeably absent from this year’s State of the Commonwealth address were comprehensive tax reform and expanded gambling. Those issues were prominent in Beshear’s 2014 speech, but failed to gain traction in the last session of the General Assembly.
A Call for More Collaboration
To close his address, the governor returned to the themes of bipartisanship and collaboration. Noting Republican Senate President Robert Stivers and Democratic House Speaker Greg Stumbo on the dais, Beshear said they all share a common goal of a stronger Kentucky.
“Our ability to put aside differences and focus on people and problems is why here in Kentucky we have made divided government work,” Beshear proclaimed. “So during this legislative session, we have a choice. We can let ourselves get way-laid by things like partisan bickering... Or we can accelerate Kentucky's considerable momentum by remaining focused on the job before us.”
Response from Legislative Leaders
Following the governor’s address, Rep. Stumbo (D-Prestonsburg) praised Beshear for his accomplishments and for emphasizing the success of Kynect.
“When you’ve got a good story, you ought to tell it and he’s got a very good story to tell,” Stumbo said. “I think the tide is turning as more people understand that affordable, accessible health care is a quality of life issue that government ought to be involved in.”
Sen. Stivers (R-Manchester) said in terms of generating national publicity for Kynect, the governor has been successful. But he argues the future benefits for Kentuckians remain uncertain.
“There is a question of whether you agree with the successes that have been established [by Kynect] and the long-term impact that it will have,” said Stivers. “I think there is a discussion still to be had on what effect it will have and how effective it will be.”