Damon Thayer: First session as majority floor leader ends

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After finishing my first legislative session as majority floor leader, I am proud to look back at the significant accomplishments of the 2013 Regular Session of the General Assembly.  Most importantly, we successfully established a new spirit of bipartisan collaboration which allowed us to move the state forward in a meaningful fashion on substantive issues such as comprehensive public employee pension system reform, university bonding, a regulatory framework for hemp production, and added transparency for special taxing districts.
Without doubt, the single greatest achievement of this session was reform of the financially troubled public employee pension system.  Since the Senate had introduced legislation to preserve and protect state and local employees’ retirement over the last eight sessions, it was with a renewed sense of urgency that a resolution be achieved on this looming crisis.  I commend Governor Beshear for his leadership as he worked diligently with both chambers to find compromise on Senate Bill 2 and House Bill 440, measures that reflect the recommendations of the bipartisan task force that met this past year and that establish a funding mechanism to fully pay the actuarially required contribution.  The bipartisan funding solution does not rely on any new taxes or any lottery revenue. These two bills will ensure Kentucky’s public employees’ retirement is protected, while saving taxpayers an estimated $10 billion over the next 20 years.
Senate Bill 2 will not affect current and retired employees, nor will it affect teachers’ retirement.  It will create a hybrid cash balance plan for all new state employees, local government employees, legislators and judges who enter the system after January 1, 2014.  It is not a 401K plan. The plan will be managed by the Kentucky Retirement System (KRS) as it is today, with a four percent contribution by the state and a five percent contribution by the employee.  The employee is guaranteed a four percent minimum return on investment.  The employee will be fully vested with contributions and returns after five years, so the benefits accrued can be taken if they switch jobs.  In addition, it will require pre-funding of any future cost-of-living adjustments for retirees. Without this reform, the pension system was projected to be bankrupt in four years.  Now, the extra dollars needed to pay for pension benefits are available for other worthy purposes like education and healthcare.
 The General Assembly also provided a boost to economic development efforts by positioning Kentucky for hemp production.   Senate Bill 50 would establish a framework for industrial hemp farming if the federal government legalizes its growth.  Senator Rand Paul, Congressman Thomas Massie and Congressman John Yarmuth agreed to seek a waiver of the federal ban on hemp production as soon as the regulatory framework is established.  Since Kentucky’s climate is ideal for hemp, the crop is an alternative for tobacco farmers, with the economic benefit of jobs from the production of goods made from hemp, including cars, clothes and cosmetics.
The General Assembly adopted House Bill 7, an important bill authorizing six of the state’s eight public universities to bond $363 million for 11 building projects.  These include renovation and expansion of Albright Health Center at Northern Kentucky University, a new science building at the University of Kentucky, and an Honors College and International Center at Western Kentucky University, among others.  The measure requires the bond indebtedness be paid by the universities, not state tax dollars, and precludes the use of tuition increases as a means of paying the debt.  This legislation will help the universities with much needed classroom and housing improvements while creating more than 5,000 construction jobs.
Special taxing districts became the focus of the 2013 Session as the Senate and House worked together to pass legislation that would provide for more accountability and transparency to the general public. More than 1,200 such districts spend in excess of $2.1 billion of public money each year.  House Bill 1 requires these districts to publish their financial statements online and conduct regular audits.  In addition, the special taxing districts would be required to submit a budget report to their local fiscal court and hold a public hearing before imposing a new fee or increasing the rate of an existing tax.  The measure enhances the degree of accountability that should always accompany the power to tax.
In addition to these major issues, the General Assembly also passed initiatives to strengthen Kentucky’s educational opportunities for high achieving, as well as at-risk students; to help the state’s most vulnerable citizens, its children, from human traffickers; to enhance Kentuckians’ Constitutional rights to bear arms; and to protect religious freedom, among other issues.  Overall, the General Assembly passed legislation that will protect and improve the quality of life of every Kentuckian.
Unless called to a special session by the Governor, the General Assembly will convene for the 60-day session in January 2014 to begin work on a new budget.  Between now and then, the interim joint committees will meet to hear new issues and review past ones.  In addition, I will be meeting with constituents and look forward to hearing your thoughts and concerns.  Please call me toll-free at 1-800-372-7181.