tax reform

J. Tyler Franklin

U.S. Sen. Bernie Sanders will be in Louisville on Friday to rally opposition to the Republican tax plan currently making its way through Congress.

It’s the second time this year the Vermont senator has waded into the Republican-controlled waters of the bluegrass as he tries to put pressure on the state’s two influential senators — Rand Paul and Majority Leader Mitch McConnell.

J. Tyler Frankin

Gov. Matt Bevin Monday defended his proposal to change the state’s pension systems before a group of business leaders in Lexington.

Late last week, Bevin released a much-anticipated draft of a bill that would move most future and some current retirees onto less-generous 401(k)-style plans.

The proposal would also tweak benefits to current employees and retirees, drawing fire from state employee groups that say the changes would be illegal.

J. Tyler Franklin

Kentucky’s state budget director said Gov. Matt Bevin will soon enact mid-year budget cuts to help avoid a projected revenue shortfall at the end of the fiscal year.

Earlier this month, a panel of economists tasked with predicting how much money the state will bring in projected the state would be about $155 million short of its initial estimates.

That move cleared the way for Bevin to make an official budget reduction plan — spending cuts to state agencies that don’t have to go through the conventional budgeting process.

Governor Matt Bevin has been outspoken about overhauling Kentucky’s tax system. Bevin said he wants to get rid of the inventory tax, which is placed on a company’s inventory that is held in the state. That tax is used to fund local school districts, and some worry that eliminating the inventory tax will have a negative impact on education. Little detail has been released about what would replace that revenue.

J. Tyler Franklin

Adding to Kentucky’s financial woes, economists are predicting the state will bring in around $200 million less than originally projected this fiscal year.

The state’s Consensus Forecasting Group, a panel of economists that budget writers rely on to estimate how much money the state will make, predicted Kentucky will bring in a little more than $10.6 billion in revenue instead of the more than $10.8 billion initially estimated.

Becca Schimmel

Congressman Brett Guthrie said he’s not sure if his Republican colleagues in the Senate will be able to repeal and replace Obamacare this year. He made these comments at a town hall style gathering Wednesday in Bowling Green.

Guthrie said he supports repealing and replacing the Affordable Care Act at the same time. The Bowling Green Republican said the House did its job by sending a bill to the Senate that would have accomplished that task. But the Senate wasn’t able to get 50 votes to pass several versions of reform. Guthrie said he isn’t sure if repeal and replace will happen this year.


Jim Carroll started working for Kentucky’s state parks system in 1978 making $780 a month.

“So I knew the pay wasn’t good but I knew that it was a place where you could advance over time,” Carroll said. “It was stable, and retirement was part of that.”

Carroll later worked in the tourism cabinet and retired in 2009. Since then, he’s organized a group of concerned state pensioners called Kentucky Government Retirees.

Carroll draws a monthly pension from the retirement system for most of Kentucky’s state workers, Kentucky Retirement Systems. Depending how you measure it, KRS has one of the lowest funding levels in the nation.

Beshear Offers Tax Overhaul Plan

Feb 4, 2014

Gov. Steve Beshear has proposed sweeping changes to Kentucky's tax code that include lowering tax rates for individuals and businesses and expanding the sales tax to more services.

The state's cigarette tax would increase to $1 a pack under the plan.

Beshear said Tuesday his package includes 22 changes to the tax system. He calls it a "beginning point" in discussions with lawmakers to modernize the tax system to make Kentucky more competitive.

The Democratic governor proposes applying the state sales tax to labor charged to fix such personal property as automobiles and computers.

The sales tax also would apply to admissions to fitness centers and golf courses under the plan.

Beshear says his plan would increase state General Fund revenues by nearly $210 million per year once fully implemented.

In his seventh state of the Commonwealth address, Kentucky Gov. Steve Beshear told lawmakers that he will seek to reinvest in education, while also urging the General Assembly to reform the state's tax code.

The nearly 50-minute speech touched upon a variety of topics, including the state’s implementation of the federal Affordable Care Act, gains in auto manufacturing and the implementation of new education standards.

In stressing his latest priority, Beshear said that he would make cuts to other programs in order to  reinvest in education. To make up some of the funds, the governor pleaded with lawmakers to act on tax reform this year.

“I realize that tax modernization is a sensitive topic, especially in an election year. But the people elected us to tackle difficult issues. So engage with me. I ask you to engage with me on a core weakness that is keeping the Commonwealth from reaching its potential.”

Beshear offered few details on the kind of changes he wants to see in the tax code.

After the speech, Senate President Robert Stivers said he will need specifics in order to have a discussion on the issue.

What To Look For During 2014 Kentucky General Assembly

Jan 7, 2014
Kevin Willis

As temperatures in Kentucky slowly climb out of the polar abyss, so too will state lawmakers emerge from their districts and trek to Frankfort for the opening day of the 2014 regular session of the Kentucky General Assembly.

The session got underway Tuesday.

Kentucky legislators will have until the relatively balmy date of April 15 to craft a biennial state budget, which will be a difficult task: Amid one of the toughest economic outlooks in recent memory, legislators will be forced to grapple with funding priority issues like reinvesting in K-12 education and funding nearly $900 in teachers' pension liabilities.

Many people, from political observers to politicians themselves, have estimated that in order to fully fund these and other priorities, an additional $400 million to $1 billion (or more) in revenue must be raised to plug the gap in spending.

But the state expects only $250 million in additional revenue.

Although the budget will be the front and center issue, here's a glimpse at some other legislative priorities:

Kentucky Education Commissioner Terry Holliday is calling the next legislative session a “make or break year” for the state’s public school system.

“I think we’ve hit the wall for increasing student performance and without some reinvestment in public education I think kids are going to lose out.”

Holliday is asking state lawmakers to restore per student funding to their 2009 levels during  biennium budget discussions next year. He also says state grant funding needs to be restored. That will mean committing nearly $270 million dollars more to education for the next two years.

Holliday says the General Assembly can accomplish this through tax reforms and approving expanded gaming, two issues that have not made headway in the recent past.

Education will be competing with state pension and healthcare issues among the other state agencies that have seen cuts to their budgets.

Stumbo: No Kentucky Tax Overhaul Coming This Session

Feb 19, 2013

Kentucky House Speaker Greg Stumbo says he doesn't expect a tax reform package to be brought up for a vote in the current legislative session.

Stumbo told reporters Tuesday that such a package doesn't have the 60 votes necessary to pass in the House.

A special commission appointed by the governor proposed reforms that could generate about $690 million a year in additional revenue.

Stumbo said one of the proposals made by the commission could surface in days ahead as a method of shoring up Kentucky's weakening pension system for government retirees. That proposal calls for raising the cigarette tax from 60 cents to $1 a pack, which could generate $100 million for the pension system.

Kentucky LRC

Kentucky lawmakers seemed eager to dig into another tax reform bill this year, but the chair of the latest tax reform commission says reform isn't likely coming soon.

Lt. Gov. Jerry Abramson—who chaired the commission —and Mary Lassiter, the secretary of the cabinet, addressed lawmakers on the budget committees about the recommendations of the Blue Ribbon Tax Commission.

Many lawmakers were eager to see a bill filed, even if tax reform is unlikely in this year's regular session. But Lassiter and Abramson implied that one was not likely anytime soon.

But State Rep. Jim Wayne, a Democrat from Louisville, who unveiled his own tax reform bill today, said he would still like the see the commission's suggestions in bill form.

A state senator who represents parts of south-central Kentucky isn't betting on major changes to the state's tax code this upcoming legislative session. Overhauling what's been described as an antiquated tax system is at, or near, the top of many lawmakers' agendas.

Sen. David Givens, who represents Allen, Barren, Edmonson, Green, Metcalfe, and Simpson counties, says while there's a lot of talk in the air about streamlining Kentucky's tax code, he doubts anything will pass during the 2013 General Assembly.

"From what I gather, I don't think the tax reform issue is far enough down the road that we can make those sorts of changes in the session ahead, with it being a short session," the Greensburg Republican told WKU Public Radio.

A panel appointed by Gov. Steve Beshear to look at changes to Kentucky's tax system has proposed lowering individual and corporate tax rates, raising the cigarette tax and expanding the state sales tax to certain services.

Lt. Gov. Jerry Abramson said the changes recommended by the Governor's Blue Ribbon Commission on Tax Reform would generate about $659 million in new state revenue each year.

Abramson, who headed the commission, said the changes will make Kentucky more competitive in creating jobs.

The proposal would lower the state's top corporate tax rate to 5.8 percent from 6 percent. Individual income tax rates also would drop. The state's cigarette tax would go to $1 a pack from the current 60 cents.