Kentucky Club for Growth
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April 29, 2010

House Democrats Uninterested in Education Reform, Beholden to KEA, Says Stumbo

The story writes itself:

Education leaders' opinions are key to support from House Democrats, according to House Speaker Greg Stumbo, D-Prestonsburg. He said that as of Wednesday, there weren't enough votes in the Democratic-controlled House to pass a measure that would allow charter schools.

Stumbo said that until the Kentucky Education Association and other teachers' groups change their stances, it's unlikely that the House would vote for charter schools.

Nice of Stumbo to admit what we knew all along: that the teachers' union runs education policy in the state, not your elected officials.

Beshear Substitutes Hyperbole for Leadership

The sky is falling in Kentucky.

If lawmakers can't resolve an impasse over the two-year spending plan, Beshear said, visitors would be turned away from state parks, coal mines might close because there would be no safety inspectors or rescue teams, companies depending on economic development programs would go without help, and death investigations that depend on an autopsy by the Office of the Medical Examiner would stall.

Dozens of other agencies and programs also might lose funding, including the Kentucky State Police, veterans' nursing homes, existing road projects, the state-federal Medi caid health care program for the poor and disabled, public universities and public health departments, Beshear said.

And he didn't stop there.

For example, he said, he doesn't yet know whether he will have to order coal mines to halt production if safety inspectors and rescue crews are sidelined.

and

Beshear said that -- while his staff has not reached final conclusions -- many other state functions may also be forced to shut down.

They include universities, road construction, state veterans' nursing homes, regulatory and licensing agencies, Medicaid, mental health hospitals, public health departments and aging services."

The state government has been shut down before. In fact, it was practically shut down just last week as a computer software problem forced most state workers to go home early.

Did you notice?

Besides, the reality of the 2005 ruling is that it offered very few specifics, and no definition of what 'essential services' might be. Governor Beshear admits as much when he notes:

"This decision has not been tested," Beshear said of the 2005 ruling. "We are in uncharted territory."

So anything he decides to shut down is his choice, subject to the challenge of a lawsuit. And there won't be anyone eager to file a lawsuit challenging whether keeping veterans in their nursing homes is 'essential'.

The Governor's actions are scaremongering at its worst, and a sad excuse for failing to lead.

April 27, 2010

Senate 26 Republican Primary: Harris v. Godfrey

The 26th Senate District includes Carroll, Henry, Oldham, Trimble and part of Jefferson Counties.

Sen. Ernie Harris has represented the district since 1995, and has not been challenged for the seat since 1998.

This year, Don Godfrey, an information security officer at Humana, is mounting a casino-based challenge for the seat.

The Courier-Journal profiles:

In his first contested race since 1998, Republican Sen. Ernie Harris faces a newcomer in District 26 who is relatively unknown.

Don Godfrey of Goshen said he has been relying on his page on Facebook, a social-networking site, and on word of mouth to draw attention to his campaign.

Still, some voters, including Oldham County Republican Party chairwoman Anne Gernstein, said they don't know much about him.

"Normally when candidates are going to run for office, they will at least contact the county chair or state chair," Gernstein said.

Godfrey, a 42-year-old computer information security employee at Humana, said he entered the race to help protect the horse industry and get involved with the political process.

Generally, a pro-casino Republican is facing an uphill battle, and this challenge is unlikely to be an exception. Still, we might suggest that Sen. Harris has become a bit complacent.

While Sen. Harris did manage to reach 71% on the 2008 scorecard, he scored only 61% in 2007 and 41% in the not-yet-released 2009 edition. This is a very poor lifetime score for someone who claims to have been named "Taxpayers Best Friend" on their website.

For his part, Godfrey recognizes the need for tax reform in Kentucky:

On the issue of the state budget, Godfrey said the state could look at services that can be cut and avoid tax increases. He said the state should be less reliant on the income tax and try to be one of the most tax-friendly states.

"There are ways to be a more tax-friendly state," he said. "If you can do that consistently, you can possibly catch the eye of businesses trying to locate."

He said Oldham County, where leaders are anxious to lure businesses and well-paying jobs, could attract companies if the state had a more favorable tax structure.

In contrast, Harris equates his job to spending your tax dollars:

He said an overpass near the site is also being considered and he's worked to get $15 million earmarked for an overpass, and an interchange could be another $20 to $25 million.

"Whatever is needed, we'll work to get it done," Harris said.

His goals also include allotting state funds for sewer improvements in La Grange, he said.

While this may not be much of a contest, it certainly illustrates the choice we all face this May and November: are we going to keep rewarding politicians who think 'doing a good job' is 'spending money', or is it time to find some new folks who really want to make the necessary changes to attract businesses to Kentucky.

April 26, 2010

Feds Bail Out Kentucky Schools, Should Make Budget Agreement Easier

The U.S, Department of Education has announced an additional $176 million in federal transfer payments to Kentucky school systems, demonstrating once again that the stimulus did little to create jobs and mostly protected politicians from making the tough choices involved in cutting budgets.

The new funding will be earmarked toward fiscal stabilization, a category that has enabled school districts to preserve teacher jobs.

To qualify for the funding, Kentucky had to document such things as how it has used student data and evaluations of teachers and principals for educational improvements.

Holliday said that while the latest grant will cushion budgets for another year, "My biggest concern going forward is fiscal year 2012." He said he hopes Congress works out more funding for that year to prevent major cuts.

But, as we said, it does allow politicians more money to throw around. Besides Greg Stumbo's horrible debt proposal that Republicans in the state House and Senate rejected and now Governor Beshear rejects, the biggest issue discussed has been how to reduce the education budget. This extra $176 million should make that discussion much simpler.

With education funding resolved, and Stumbo's debt proposal fully rejected, there should be nothing left standing in the way of completing the budget. Let's hope for a quick and responsible special session.

Yeah, right.

April 23, 2010

Even Beshear Says Stumbo's Stimulus Proposal a Bad Idea

As General Assembly leaders work towards an agreement on a two-year budget, even Governor Beshear has weighed in on how bad of an idea Speaker Stumbo's debt-based stimulus is.

Beshear said he told Williams and Stumbo that he prefers a budget with little borrowing for school construction, water and sewer projects and roads.

Stumbo and House Democrats have been heavily pushing the projects, saying they would create up to 25,000 jobs.

Senate Republicans have opposed the idea, saying the state can't afford to rack up more debt during uncertain economic times.

Beshear seemed to side with Republicans on projects, saying that "borrowing a bunch of new money right now ... we ought not to do that."

Finally,the Governor recognizes the good sense in Williams' positions on charter schools and debt.

A gold star for the Governor finally standing up for good policy, and a black star for waiting until a week after the session has ended to do it.

April 22, 2010

Ridiculous Franklin County Judge Wingate Loses Again

Once again the Judge Thomas Wingate, one on the most politically stilted judges in Kentucky, had a decision reversed by a higher court.

You may remember back when Judge Wingate was scolded and had all responsibility removed from him with regards to Beshear's war on the Internet:

Secondly, the court ruled that "a Franklin Circuit Court judge cannot hold further hearings on the issue." To have the case removed from his hands and then a ruling that he is not to dally in the case again has to be somewhat embarrassing for Judge Wingate.

Once again, the Kentucky Supreme Court had to reverse a political judicial decision, telling Judge Wingate that he was wrong in letting Governor Beshear kick Virginia Fox off the Council of Postsecondary Education.

[Fox] had been appointed by former Gov. Ernie Fletcher to a term that doesn't expire until 2012. The Senate later confirmed her appointment, but the House took no formal action.

Beshear interpreted that to mean Fox didn't complete the confirmation process. He then appointed former Lexington Mayor Pam Miller to replace Fox.

In the ruling, the Supreme Court concluded that gubernatorial appointees need confirmation only from the Senate. Minton said the narrow ruling dealt with no other issues raised in the lawsuit.

...

Franklin County Circuit Judge Thomas D. Wingate had thrown out her lawsuit shortly after it was filed, saying Beshear had acted properly when he replaced Fox with former Lexington Mayor Pam Miller on the higher education council.

Someone needs to campaign against Wingate with the slogan: "Wingate: Wrong Again!"

April 20, 2010

Papers Fail to Credit David Williams for Foresight

While the editorial boards of the Herald Leader and Courier-Journal were hasty to heap the blame for the budget impasse at the feet of Senate President David Williams, they have been slow to recognize his foresight on charter schools.

In January, President Williams led the charge to finally allow school choice in Kentucky, joined by House Republicans but derailed by Senator Kerr. Williams and other supporters contended that school choice legislation was necessary to qualify Kentucky for "Race to the Top" funding.

Unfortunately, the effort was defeated, Kentucky's application was rejected and Williams was proven right.

Now, not only has the Education Commissioner come around, so also, apparently, Governor Beshear:

Gov. Steve Beshear said Tuesday he wants to explore the possibility of adding a proposal to allow charter schools in Kentucky on the agenda of a special legislative session to craft a state budget.

Last week's editorial smugly asked whether 'Williams just likes train wrecks.' Perhaps they need to get it through their heads that he's standing up for the changes -- school choice, sustainable levels of spending, reduced debt -- that Kentucky needs to make.

New Candidate for Senate District 2

Excuse the exciting headline, but, taking advantage of the later filing deadline for Independents, Senator Bob Leeper has officially filed for reelection.

April 19, 2010

First Session Over, Taxpayers Winning

We at the Kentucky Club for Growth are generally disappointed with the taxing, spending and debt that happens in Frankfort.

This year, though, the Senate, supported by Republicans in the House stood up for the taxpayers of Kentucky. As the Herald-Leader editorialized on Sunday:

Maybe Kentuckians will hail Senate President David Williams and his Republican colleagues as heroes who held back a feckless flood of Democratic debt.

Amen! As Greg Stumbo and House Democrats pushed tax increases, a billion-dollar "Kentucky Stimulus", and then hid excessive spending by shortening the budget to only nine months, the House Republicans fought and the Senate eventually put an end to it. They adjourned session without passing a budget because the House would never agree to their small effort of responsibility.

The HL claims...

The House budget proposal would have used 7.43 percent of revenue during the next two years to make payments on bond debt, the Senate budget 6.88 percent, a bridgeable gulf.

...but the fact is that 6.88 percent is a record level of debt. The low end of the "gulf" was based entirely on issuing no new debt, inheriting the irresponsibility of previous budgets. The Senate effort was a small act to protect Kentucky and put the government spending on the right path for the future. The HL seems to think that this was an outrageous priority.

Looking back on this session, though, it's pretty clear Kentucky was the loser.

But the editorial board lacks historical perspective. When do you ever remember any part of the legislature drawing a line in the sand for a responsible budget? This is a bold development that, if it persists through the inevitable special session, will truly make Kentucky a winner.

April 15, 2010

Tax Day Facts

While we're busy watching session close and trying to make sure we've sent in all the forms to all the various taxing governments, we'll take it easy and give you some tax facts for tax day.

  • The top 10% of earners paid 71% of all income taxes
  • The three largest refundable tax credits will pay non-taxpayers $114 billion today.
  • Tax freedom day is April 9th, but to actually pay the $1.3 trillion deficit would require working until May 17th.
  • According to the National Taxpayers Union (NTU), in fiscal year 2009, the IRS estimated that individual and business taxpayers spent 7.75 billion hours complying with the tax laws. That is the equivalent of 3.7 million employees working 40-hour weeks year-round without any vacation.
  • Using the most recently reported average employer cost for civilian workers by the Bureau of Labor Statistics of $29.18 per hour, this time is worth an incredible $110.6 billion.
  • The Internal Revenue Service (IRS) reported that individuals spent an estimated $29.33 billion in 2009 for tax software, tax preparers, postage, and other out-of-pocket costs related to filing their federal income tax--that is almost twice the size of Honduras's economy.
  • The IRS's National Taxpayer Advocate estimates that taxpayers spend $193 billion each year to comply with income tax requirements. This amounts to 14% of aggregate income tax receipts.
  • The IRS was appropriated $11.6 billion in FY 2010. To put this figure in perspective, it is more than the amount Congress appropriated for missile defense programs.

April 14, 2010

No State Government is Very Transparent

Or at least that's what we're led to believe given the results of a scorecard from US-PIRG. From the Herald Leader:

Kentucky scored best in the nation for transparency of state government spending in a report released Tuesday by U.S. PIRG, a public-interest research group based in Boston.

Only Kentucky scored an A, or 97 of 100 possible points, on the group's Transparency Scorecard. Ohio placed a distant second with a B at 84 points. Eighteen states flunked.

Things off the top of my head that are still not in any significant way transparent:

  • Legislative committee votes
  • The scope of state pension obligations
  • The budget negotiation process
  • Local education spending
  • Postsecondary education spending

The group mentions the Open Door website, which is truly better than nothing, but the real resources are available only through the efforts of private groups like FreedomKentucky.org.

Its nice to get an 'A' but the curve is ridiculous.

At the Moment, No Budget Is Most Likely Outcome

So said Senate President David Williams this morning on Jack Pattie's radio show. According to the Herald-Leader:

"I believe the probability is great that we will leave here without a budget," Williams said on Jack Pattie's Newstalk 590 show on WVLK on Wednesday.

Williams said that after two weeks of negotiations House Democrats sent an ultimatum to the Senate -- a one-year budget that included "hundreds of millions" of dollars in projects that would require more borrowing. The House also said that the Senate must agree to it's two-year road budget or there would be no budget, Williams said Wednesday morning.

Williams said the Senate Republicans could not agree to that ultimatum.

Recent reports have both houses agreeing to issue a budget for only a single year instead of the usual two. Passing a two-year road budget and a one-year budget is not a reasonable plan, nor is adding hundreds of millions of dollars in debt when you are deliberately avoiding planning ahead.

The source of the problem is Speaker Greg Stumbo:

Stumbo has said in recent days that House Democrats do not want to leave Frankfort without a jobs program.

Since we have hear no discussion of job-creating policy changes, only debt-supported spending, Stumbo is issuing an ultimatum that can't be met. Someone needs to tell him that Frankfort doesn't create jobs, entrepreneurs do. Email him here and let him know.

In Sesson's Penultimate Day, Stumbo Still a Debt-Pusher

Kentucky has a long history of budgets it can't afford, and apparently Speaker Greg Stumbo is a traditionalist.

He has relented in his demand for more debt than the commonwealth has ever issued, but insists on some level of debt-based spending pork for his political buddies. He has exacerbated the risk of any debt by insisting on a one-year budget instead of the usual two-year budget that allows for more careful planning.

Now Governor Beshear is publicly entreating him to do his job:

If legislators don't meet the deadline, Beshear said, "we will have to be back in a special session, and the taxpayers would have to pay them an additional amount of money for doing a job that most people think they should finish in the regular session."

Whether it is debt we can't afford or a special session we can't afford, it looks like Stumbo is intent on spending your tax dollars in an irresponsible way.

April 13, 2010

Tolls and Expensive Concrete Plans in Louisville

Want to know more about the latest scheme to tax your driving in Louisville? This guy running for mayor lays it out....

Charter Schools Still Possible

We've written much about the budget which is the overriding focus of the final two days of session, but the other big issue still on the table is whether to finally allow school choice in Kentucky.

We wrote recently about Education Commissioner Terry Holliday's statement that House Democrats had torpedoed Kentucky's chance at funding because they are beholden to the teacher's union, and the union thinks they are the only entity that should have any authority over Kentucky's school system.

What we are left with is the rare situation where the House Democrats's insatiable appetite to spend money may lead them to override their political alliances and actually enact a good change in public policy.

The opportunity for charter schools is now, and you should make your voice heard. Follow this link to fill out a form and send an email the legislature stating your support for charter schools now!

April 12, 2010

Stumbo Remains Committed To Pushing Kentucky Stimulus Debt Disaster

As the budget negotiations continue with the last day of session scheduled Thursday as mandated by the Constitution, the Senate remains steadfast in its refusal to consider Speaker Stumbo's reckless Kentucky Stimulus plan. Stumbo, however is wedded to his failure of an idea to bankrupt Kentucky:

"However, the House remains vigilant in its commitment to the Kentucky Jobs for Kentucky Families program, and on behalf of the working families of the state, we cannot accept any proposal that does not create a significant amount of jobs throughout the commonwealth to help Kentucky's working families through this terrible recession.

Let's ignore for a moment the wishful and laughable idea that any government budget will create a 'significant amount of jobs'.

Negotiations now center around a one-year budget, which is another bad decision that will allow our overspending legislature to hide the actual amount of debt and spending in the budget.

The Kentucky state budget is regularly passed in a two-year cycle, and allows some ability to plan out debt service on new projects. Because the state fiscal year begins in July, yet the calender year begins in January, the legislature regularly considers projects to begin in January which is the middle of a fiscal year. This allows the budget to only account for half of the debt service that will be annually required, because it will start in January 2011 instead of July 2010.

In a two-year budget, this trick is used less, because impatient legislators would have to wait an extra year to begin the project if its debt service is hidden at the back of the budget.

If a one-year budget is all the legislature can muster, new debt (which is already at historically high levels) should be limited to truly emergency measures. Because the budget will already be a challenge for 2012, the General Assembly should not add the additional burden of back-loaded, debt-based spending taxpayers can not afford.

This is a concept the Senate "gets", as they hold fast to rejecting the Speaker Stumbo's cries for taxes and more debt:

State Senate budget negotiators offered on Friday to accept the House plan for funding various programs and eliminating two school days, but said no to new debt for construction projects and tax changes.

We encourage you to contact your legislators today and let them know you want a budget we can afford with no new taxes and no debt-based Kentucky Stimulus!

April 9, 2010

Do You Support More Debt or Cutting Spending?

Kentucky political science professors don't know the answer.

The Herald-Leader today asks various university political analysts about the current budget stalemate, correctly identifying the philosophical differences:

Political observers say the deadlock highlights a philosophical difference between the two sides that mirrors a national political landscape pitting cries for less government spending against calls for government intervention to improve lives.

None, however, seem to realize the incredible unpopularity of debt-based government intervention in the economy. 59% of voters say either that the stimulus had no impact (26%) or that it hurt the economy (33%). Just about no one wants another stimulus or more bailouts. Which is why we've been so so perplexed that Speaker Stumbo would be so insistent on recklessly pursuing record debt levels for the commonwealth.

The professors, though, think the question is still up in the air.

Rhodebeck and Gershtenson expect the debate to flow into this year's legislative campaigns. All 100 state House seats and 19 of the Senate's 38 seats are up for grabs.

So who would have the advantage at the polls?

"It's too early to say how this would turn out at the polls," Gershtenson said. "Neither side has a clear advantage here, which would be the case if one side was backing additional taxes. ... While Kentuckians, like most Americans, are cautious about bigger government, we're accustomed to seeing government involved in our lives."

Rhodebeck said she does not think public sentiment is as great against government spending as the media portray.

"Fiscal conservatism is getting a lot of attention in the media, but I think people are more focused on getting help in a very tough economy," she said. "If the economy improves, I think there will be less anger directed toward government."

Perhaps they really don't get it, or maybe this is just wishful thinking from some government employees who are going to have to deal with the reduced spending.

Regardless, come this May and this November, the Kentucky Club for Growth will do all we can to make sure you know who are the true fiscal conservatives fighting against the 'government involvement in our lives' that we are sadly 'accustomed to seeing'...

April 8, 2010

Former National Club President Doing Well

It's not really in our sphere of attention, but we're always interested in what former Club for Growth President Pat Toomey is up to. From RealClearPolitics:

Quinnipiac's latest survey in Pennsylvania (1,412 RVs, 3/30-4/5, MoE +/- 2.6%) shows that the Senate race remains volatile. Sen. Arlen Specter (D) had a seven-point lead just a month ago, but former Rep. Pat Toomey (R) has now jumped out front.

Senate General Election Matchups
Toomey 46 (+4 vs. last poll, 2/22-28)
Specter 41 (-8)
Und 12 (+4)

Toomey 42 (+3)
Sestak 34 (-2)
Und 22 (-2)

Senate Responds to House Budget Proposal: "Show Us A Proposal"

Apparently, even though Stumbo says he has a proposal, he doesn't yet. From today's HL:

House Speaker Greg Stumbo, D-Prestonsburg, informed Senate President David Williams, R-Burkesville, by letter late Wednesday that they are close to drafting the latest counterproposal, and he suggested reconvening formal negotiations Friday.

But Williams, in a four-sentence reply to Stumbo, didn't commit.

"As you will recall, I requested you forward to me a written counteroffer consistent with the expenditure, debt, and structural imbalance levels contained in" a budget bill approved by the Senate last week before the General Assembly adjourned until April 14, Williams' letter said. "Once you submit a counterproposal, we will promptly review that document and respond to you."

There are suggestions that negotiations will resume tomorrow. We'll keep you updated here...

April 7, 2010

Speaker Stumbo Caves to Senate, Republicans on Budget

Speaker Stumbo has indicated that the House will be willing to adopt most of the Senate's proposal in order to get a budget to the governor's desk.

On each important issue in the negotiations, House Republicans and the State Senate were standing strong for the taxpayer, while the House Democrats were supporting the same ol' tax-and-spend policies we're all tired of:

  • Where the House proposal called for $184 in increased taxes from struggling small businesses, House Republicans and the Senate refused.
  • When Speaker Stumbo proposed a billion extra dollars of debt to duplicate President Obama's failed Stimulus, House and Senate Republicans said we needed a responsible budget, not record levels of debt-based, pork-barrel spending.
  • Where the House had eliminated two school days from the calendar, the Senate recognized that it wasn't necessary to eliminate the days, even if state funding for them had to be decreased.

Today we learn that Speaker Stumbo has a new proposal, one that meets most of the positions the Senate has insisted upon. The proposal:

  • more than halves the debt-based capital spending on unneeded projects,
  • does not include any tax increases, and
  • agrees with the Senate proposal on school days and funding.

The more responsible position is winning.

House Dems, KEA, Sen. Kerr Cause Kentucky to Miss 'Race to the Top' Funding

In January we missed out on a great opportunity to allow school choice in Kentucky in the form of charter schools. Enabling legislation from legislators like Representative Stan Lee, Brad Montell and Senate Republicans were ignored by House Democrats, and the conversation was ultimately ended by Sen. Alice Kerr.

"Race to the Top" is one of the few (only?) initiatives of President Obama that we find meritorious, encouraging school choice and accountability. The requirements to receive this funding were ignored by the KEA and House Democrats, and Kentucky was rejected for funding in the first round.

Now, Kentucky Education Commissioner Terry Holliday has come around and stressed the changes Kentucky needs to make to qualify:

Without legislation enabling charter schools, Kentucky would finish out of the money in the second round of the federal Race To The Top program, said Kentucky Education Commissioner Terry Holliday.

"If we don't improve 30 to 40 points, I do not think we'll be competitive," Holliday said Tuesday. "And the only way to get 30 to 40 points is with charter school legislation."

So who's left standing in the way of Kentucky education funding?

Meanwhile, the board of directors of the Kentucky Education Association, the public school teachers' union, voted Tuesday night to oppose a charter schools measure now pending in the General Assembly...

...The general consensus around the Capitol is the charter school measure will face an uphill fight in the House and might have no chance if the Kentucky Education Association opposes it.

So, no funding for Kentucky thanks to the Kentucky Education Association and their Democratic allies in the House.

April 5, 2010

The Costs of a Health Insurance Mandate

We've noted in this space numerous times this year that "All new health insurance mandates increase health costs for us all." We thought we'd take a stab at computing just how this works.

Today, the Herald-Leader reports on a new health insurance mandate from the General Assembly:

The Senate on Thursday gave unanimous approval to House Bill 159, which requires large group and state-employee insurance policies to provide a maximum annual coverage of $50,000 for children ages 1 to 6 with autism. Children ages 7 to 21 would be eligible for a maximum benefit of $1,000 a month or $12,000 a year for autism treatment.

Autism is a growing diagnosis, with "one in 110 children and one in 70 boys have a form of autism."

The bill specifically says applied behavioral analysis, an expensive but effective treatment for children with autism, will be covered. Currently, no insurance plan is required to pay for the treatment, which usually means one-on-one work with a certified behavior analyst and can cost up to $70,000 a year. The earlier a child is treated, the better the outcome, research shows.

So Kentucky insurers are now mandated to include coverage of up to $50,000 per year for a $70,000 service for almost 1% of Kentucky's children. Thanks to analysis included with the bill, we have an estimate of how much this costs: $8.3-10.4 million annually.

Broken down on a per insurance-subscriber basis, it is estimated to cost $24-$30 annually for a member of a large group plan, and about $10 annually for a small group or individual subscribers.

This $30 annual cost increase accounts for almost 1% of the average premium for employer-based coverage in Kentucky. So next year, when your health premiums go up 5%, you can attribute one-fifth of that directly to this bill.

Because the State Employee Health Plan is a large group plan, the LRC estimates an annual cost of $4 million to the state general fund and $2 million to the road fund (which pays for Transportation Cabinet employees), based on the state's share of the $13 million cost to that health plan. Because the state must balance its budget, the $6 million must be found in spending cuts or a tax increase.

The sum total of the premium increase and the tax increase, is potentially over $16 million annually to the insured, tax-paying citizens of Kentucky.

Every year the General Assembly passes more mandates and they all add up. This is one of the significant factors contributing to the rise of health care costs in this country.

April 1, 2010

House Republicans Helped Set The Stage for Current Budget Negotiations

In the current budget negotiations, the Kentucky Senate is taking a strong stand against reckless indebtedness and tax increases that target Kentucky's most vulnerable businesses.

One thing that helps the Senate stand strong now, is that when Democratic House leaders pushed their budget bloated with debt and tax increases, House Republicans, with the exception of Jim Stewart, made a strong effort to point out its shortcomings.

They offered amendments to repeal prevailing wage requirements, and voted en bloc against the tax increases and record debt.

House Democratic leadership were unable to handle being called out and became confused, making ridiculous speeches like "Cliches like 'You can't spend your way out of debt' do not apply to a modern economy" (actually said by Rep. John Will Stacy, the Democratic Whip)

Senate leadership's resolve is reinforced when House Republicans join them. Let's hope the one block holding-out -- House Democrats -- will finally join the rest of the legislature and do something good for Kentucky taxpayers.

The Pressing Need for State Pension Reform

Earlier, we wrote of one of the many bad ideas in the legislature this session:

In what appears to be a needless but costly rearrangement of deck chairs, the Senate Committee on Education will hear HB 164, transferring all KCTCS employees who are engaged in providing educational services and support to inmates to the Department of Corrections. Here they will join the state retirement system and the state health plan. Not only will it cost more to hire people into the Department of Corrections than KCTCS, just because of the association, but the benefits will be more expensive too. What a great plan.

This bad idea is almost law. One of the reason this is such a bad plan is because the state is unable to afford the employees it already has. It does not need a whole new agency of employees (many KCTCS employees are under contract and not participants in state benefit plans).

In further evidence of what bad fiscal shape the state is in, the New York Times offers this graph of state debt and pension obligations as a proportion of state GDP.

h/t to Page One Kentucky

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The KY Club for Growth seeks principled candidates who are committed to the following:

* Free market principles
* Lowering taxes
* Reducing spending
* Decreasing the size of government
* Judicial reform
* Protecting property rights
* Expanding school choice
* Reducing needless regulation

We will hold endorsed candidates accountable for these principles by monitoring each candidate on a vote-by-vote basis. As a Club member, you will receive candidate monitoring updates and scorecards on a regular basis. Join us today.