4:57am

Wed January 8, 2014
State Capitol

Education Funding, Tax Reform Demanded In State Of The Commonwealth Address

A State of the Commonwealth Speech offers Kentucky's governor an opportunity to emphasize an administration's accomplishments.  Last night, Governor Steve Beshear spent a good amount of time talking about health care reforms, but also called on the general assembly to enhance state revenues and reform taxes.
Gov. Steve Beshear entered the House of Representatives to give his State of the Commonwealth Address at the Kentucky State Capitol on Jan. 7, 2014, in Frankfort.
Credit Mark Cornelison / Lexington Herald Leader

During the last year, Governor Beshear says the Commonwealth made national headlines with health care reforms, such as its expansion of Medicaid and the creation of an on-line marketplace for medical insurance.  Its economic recovery has included significant business growth. But, if the legislature can overhaul it tax code and enhance revenues, Beshear says the economic picture will brighten further. “I will present to you this session a tax modernization proposal with specific recommendations on how to move our tax system into the 21st century,” said Beshear.  While waiting to hear more specifics from the Governor, Senate President Robert Stivers noted after the speech, a revenue neutral plan’ would stand the best chance.  It means raising taxes for some people and lowering them for others. The Republican leader says such reforms would still bring more money into state coffers. “We would have more revenues because more people are working and more people are paying taxes.  That to me is a good tax code,” said Stivers. Stivers’ counterpart in the House, Speaker Greg Stumbo says many people view tax reform as something they can support, unless it increases their tax burden.  The Democratic leader also believes there is a way to adjust the tax system and collect more money for state government. “I think there is a way forward by lowering the individual rates, by lowering perhaps the corporate rates, if you spread the base, and if you spread the base, it does allow for growth,” added Stumbo. Expanding the tax base could mean levying taxes on certain services which are currently exempt.  Senate Majority Floor Leader Damon Thayer says the challenge is significant to reform taxes or expand gambling.  Instead of preparing the way for those issues, Thayer says the Governor allowed himself to be distracted by other issues. “It looks to me like he’s gonna back off and take another swing at tax reform and expanded gambling which is interesting because he spent most of the year implementing Obama Care and not laying the ground work for any major policies during this session like tax reform and expanded gambling, both of which are gonna take a lot of heavy lifting,” explained Thayer. Fellow Republican, House Minority Leader Jeff Hoover was disappointed the governor didn’t provide specifics on an expanded gambling proposal. Many educators this winter may lobby for the legalization of casinos, selling them as a much-needed source of revenue for Kentucky schools.  As for education, Governor Beshear reiterated last night, if left with no choice, he would be willing to take the needed funds from Peter so Kentucky can pay Paul. “I’m determined to find money to reinvest in education, even if I have to make harmful cuts in other areas to do so,” said Beshear. One of those taking in the State of the Commonwealth Address was State Education Commission Terry Holliday.   Afterwards, Holliday expressed some confidence the legislature will increase funding for schools, but he's see no solid figures on the amount of additional aid which could go into K-through-12 education. “Every leadership position that I’ve talked to, they all want to support education and restore some of the funds that have been cut, I think it’s just a matter of how much, that’s what we’ll debate,” said Holliday. Those dollar figures might become more apparent when the governor sends his proposed budget to the general assembly later this month.  Governor Beshear didn't just focus on money matters....he also said the Commonwealth should also take additional steps to protect umarried couple from domestic violence. “Violence is violence. Abuse is abuse whether you’re in a married relationship or a dating relationship.  Kentucky is the only state without any protection for victims of violence in a dating relationship,” said Beshear. When asked about this legislation, Senate President Stivers says current law already provides adequate protection.   Governor Beshear will also sponsor an initiative designed to cut the state’s smoking rate by ten percent by 2018.    Another would be to create ‘no phone zones’ near schools and construction zones, where drivers cannot use cell phones.