Lawmakers pass all but gambling

State News

June 25, 2009

Ronnie Ellis The Richmond Register Thu Jun 25, 2009, 08:03 AM EDT

After 10 days, $600,000, charges of one side having no concern for the beleaguered horse industry and charges from the other side of vote buying, Kentucky’s lawmakers have left town after passing three of the four special session items on their agenda.

Gov. Steve Beshear deemed the session a success because three of the four items he placed on the agenda passed, although he said he was disappointed “the Senate killed” the slots bill. He said he would sign both bills (one contained both the incentives and bridges measures).

On Wednesday, both chambers quickly passed a budget reduction bill and one combining measures to streamline and consolidate economic incentives and to authorize funding authorities for major projects, authorities which could utilize tolls to pay for such projects as new bridges over the Ohio River to Indiana.

But it was the fourth item on the call — a bill to allow video lottery terminals at horse tracks — which dominated the session and produced what some lawmakers said is the end of the era of good feeling between the two chambers. That bill passed the House — after Speaker Greg Stumbo, D-Prestonsburg, and Rep. Harry Moberly, D-Richmond, offered to load up the budget with new schools in districts represented by those who voted for the bill.

The strategy worked in the House where the bill passed 52-45, but the measure never got a floor vote in the Senate, dying in the Appropriations and Revenue Committee where Republicans outnumber Democrats 12 to 5. The governor refused to include a proposal by Senate President David Williams, R-Burkesville, to boost breeders’ incentives and purses through taxes on lottery tickets and out of state betting on Kentucky races.

During the Senate vote on the compromised versions of the other items on Wednesday, Sen. Damon Thayer, R-Georgetown, said he’d gone to Beshear suggesting the Senate would support using up to $30 million from the general fund to boost incentives and purses in the short term until a permanent solution could be reached but, “the governor plainly said no.”

That prompted Minority Floor Leader Ed Worley, D-Richmond, to say Thayer was “trying to throw up a smoke screen that the governor did not want to do something for the horse industry.” He went on to say a majority of the Senate wanted to vote on the slots measure and Williams and Senate leadership should not have sent the bill to a committee dominated 12-5 by Republicans and where it was declared dead before it arrived.

Still, both measures passed the Senate unanimously. The House also passed each easily, although the bill containing the “bridges bill” and economic incentives did not pass unanimously.

Moberly criticized a portion of the bill which exempts active military from paying Kentucky income taxes, an idea he said he supports but only if the bill contains ways to offset the cost. The slots bill contained a similar provision, Moberly said, but it would have offset the $18 million cost to the state with revenues from the slot proceeds. Moberly voted for the bill because of other provisions, but the called the tax exemption “irresponsible.”

Rep. Robin Webb, D-Grayson, criticized the bill for the lack of legislative accountability on tax breaks and incentives. Webb has consistently sought greater information from the Economic Development Cabinet and sought more accountability on tax incentives called TIFs for projects which can keep taxes generated by the new development to pay off the project investment. She voted no saying the General Assembly has a “fiscal responsibility to dig a little deeper and do a little better than what we’re doing.”

The budget basically accepts Beshear’s spending reduction plans which rely on federal stimulus money to preserve basic school funding, Medicaid, public safety and corrections. But, it adds spending by exempting Property Valuation Administrators from cuts from the 2010 enacted budget and provides more money for prosecutors and public defenders.

Beshear said it is too early to tell what the next move will be on how to help the horse industry, but bemoaned the likely closure of Ellis Park in Henderson and perhaps Turfway in Florence at the end of 2010. Stumbo said if there is to be an expanded gambling initiative in the 2010 regular session, it will have to begin in the Senate to which Williams responded by saying in that case, gambling is dead for now.

Beshear also said it is too early to tell if the issue would figure in 2010 legislative races. And despite the finger-pointing between the House and Senate and Beshear’s statement that the Senate killed the measure, the governor said he does not think the era of cooperation between himself, the Democratic House and Republican Senate has ended.

Ronnie Ellis writes for CNHI News Service and is based in Frankfort. Reach him at rellis@cnhi.com. The Richmond Register is a CNHI newspaper.

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