Legislators and businessmen and women from around the state gathered in Lexington last Thursday evening (Jan. 4) to share their priorities for the 2018 General Assembly session. The presentations were part of the Kentucky Chamber Day festivities sponsored by the Kentucky Chamber of Commerce.
Here’s a recap of the remarks made at the event by Gov. Matt Bevin and state legislative leaders.
Rep. Rocky Adkins (D-Sandy Hook)
The House Majority Floor Leader is starting his 31st year in the state legislature. He says Kentucky has a good economic story to tell because years of infrastructure improvements have helped the commonwealth attract and grow a range of industries. He cites investments in water and sewer lines; roads and bridges; airports, riverports, and railroads; and world-class broadband service as keys to landing manufacturers.
The Democrat says a continued commitment to funding public education from kindergarten through college is also needed to help train Kentuckians for the jobs of the today’s economy.
“This is the foundation that has been built, this is the foundation that we must look to for the future,” says Adkins.
In spite of the fiscal challenges facing the commonwealth, Adkins says the coming years hold exciting opportunities for Kentuckians. For example, he says no one could have imagined that aerospace would become the state’s leading export, generating $10.8 billion in revenues.
“As we look to the future, I would challenge all of us to look at a 21st century economy that will produce 21st century jobs,” Adkins says. “Let’s meet that challenge, let’s build that diversification of an economy… all across Kentucky to give our people the hope and opportunity they deserve.”
Sen. Ray Jones (D-Pikeville)
Jones says this may be the last time he addresses Chamber Day as Senate Minority Floor Leader. The Democrat is running for Pike County Judge-Executive this year, and would step down from the Senate if elected to that position.
Jones says many Kentuckians, especially those in his eastern Kentucky district, feel economically left behind. He says people are losing their jobs and struggling to pay their mortgages, taxes, and utility bills.
“A lot of people feel government isn’t working for them,” says Jones. “But let me tell you, if we work together, not as Republicans or Democrats, but as Kentuckians, we can accomplish great things.”
Jones says more companies are coming to the commonwealth to benefit from the strong work ethic of Kentuckians, and he credits Gov. Matt Bevin for helping land several significant industrial projects. Going forward, though, Jones says lawmakers must address the billions in unfunded liabilities in the state’s public pension systems.
“But I believe it must be dealt with in terms of comprehensive tax reform,” the Democrat says, “and as Gov. Bevin said [in his 2017 State of the Commonwealth address] it can’t be revenue neutral.”
The new federal tax law also contains a provision that hurts Kentucky, says Jones. He says the state and local income tax deduction, which caps at $10,000, poses great risk to pass-through companies doing business in the commonwealth.
Rep. David Osborne (R-Prospect)
The House Speaker Pro Tem made his first speech before a Chamber Day audience, and he wasted no time in painting a bleak fiscal picture for the commonwealth.
“I’m not going to sugar-coat anything,” Osborne says. “We are facing the most difficult budget session of our lives. We are facing cuts that we don’t want to make and wish we didn’t have to but know we have to.”
Osborne says Republicans are up to the challenge of cleaning up the pension crisis and other messes they inherited. But he adds there will be opportunities to tackle other important issues, including adoption and foster care reform, workers’ compensation reform, new criminal justice reforms, tort reforms, and a constitutional amendment for crime victims’ rights.
As he prepared for the 2018 General Assembly, Osborne says he’s had to consider what would qualify as a successful session.
“A win is a budget that is balanced yet responsible,” says Osborne. “It’s a reformed public pension system that drags us back from the edge of bankruptcy. It’s policy that reflects our collective desire to have the best workforce in America.”
Osborne also praises his fellow legislators, who he describes as hard-working public servants who think about what’s best for the next generation. The Republican bemoans how “the actions of a few have sullied the reputations of many,” but he says public service is still a “noble undertaking.”
Sen. Robert Stivers (R-Manchester)
The Senate President started by noting several of the legislative achievements of the past two years, including passage of right-to-work and prevailing wage bills, performance-based funding for state universities, and special bonding to fund workforce development programs.
Then Stivers noted some of the challenges facing the legislature this year: a shortage of revenues, failing infrastructure, and unfunded liabilities in the public pension systems.
“At times like this, I believe it’s Americans and Kentuckians that stand up and lead by example and, in hard times, make tough decisions,” the Senate President says. “So I see silver linings in these dark clouds.”
Stivers says there will be opportunities to address infrastructure needs and improve the state’s education and public protection systems once pension reform is enacted. But he says that will require lawmakers to work across party lines, between the chambers and with the executive branch.
The Republican says a prime example of cooperation came in 2014 when he worked with House Democratic Leader Adkins and coal magnate Joe Craft to create the Craft Academy for Excellence in Science and Mathematics at Morehead State University. Stivers says the high school students participating in that program are already sending science experiments to the International Space Station.
“If we work that way, if we think out of the box, if we work across the aisle, our ideas can take this state into the stars,” Stivers says.
Gov. Matt Bevin
The governor reiterated his goal to make Kentucky the hub of engineering and manufacturing excellence in the United States. He says the state is well on its way to doing that with $9.2 billion in corporate expansion and new-location projects in 2017, which topped the previous record year by $4 billion.
“We’re creating jobs like we never have, we’re creating investment like we never have,” Bevin says.
But he says this progress must continue.
“We have to attract people who are reinvesting in the state, like the Toyotas and like the Fords,” the governor says. “Companies that are innovative and are shattering all sorts of ideas about how business should be done, that are disruptive in the truest sense of that word. Companies like Amazon…companies like Braidy Industries and like EnerBlu who are transformative.”
“They are here because they recognize the opportunity and the excitement that is possible here,” he says.
Bevin attributes these investments to the fact that the state is taking its financial obligations seriously, including paying down the unfunded liabilities in the public pension systems. He says he believes there are sufficient votes in the legislature to pass a pension reform bill. And he criticizes reform opponents who complain that the reforms might cost the state more than doing nothing.
“Well, of course it will,” the governor says. “That’s what happens when you pay your bills.”
Bevin describes the upcoming state budget as being both “brutal” and “sobering,” and he says there won’t be money available for education, infrastructure, and other needs until the pension problem is addressed.
The governor says he is awaiting federal approval of the state’s Medicaid waiver application, that he says will transform the program in the state and be a model for the nation. He says Medicaid is not meant to be a dead-end, but it should be a way station as a person transitions from a place of need to being a self-sustaining citizen.
He also advocates for tort reform and caps on punitive damages that will help protect Kentucky’s retail, manufacturing, and health care businesses from frivolous lawsuits. Bevin says the commonwealth should not be a playground for trial attorneys.