Stumbo will include earned income tax credit in slots bill

FRANKFORT –Kentucky legislators will meet at high noon Tuesday to begin a 60-day session to consider a variety of issues ranging from a financial crisis to expanded gambling.

House Speaker Greg Stumbo said in an interview Monday that he will file in this session the slots-at-tracks bill the House passed last year but the Senate budget committee killed.

He said the expanded gambling bill will be similar to last year’s with some “minor changes in expenditures,” especially a provision to help the poor through an earned income tax credit.

It is a tax credit for certain people who work and have low wages. The move has been pushed for several years by years by advocates and Rep. Jim Wayne, D-Louisville.

At this point, Stumbo said, he does not think the House would vote on any gambling bill until there is assurance from the Senate that it would go along with it.

“If it’s just going to die over there, there’s no need for a useless gesture in the House,” he said.

Sen. Damon Thayer, R-Georgetown, is backing a constitutional amendment to allow slots parlors in the seven counties with races. It would be subject to a statewide vote and local votes.

But Senate Democrats have expressed little interest in it, saying it will not help the horse industry soon enough.

Much of this year’s session will focus on the two-year budget.

Beshear expects a budget shortfall of more than $1.4 billion. Senate President David Williams, R-Burkesville, puts it more at $900 million.

Beshear is expected to deliver his budget plan to the legislature on Jan. 19. Legislators will work on it until the end of the session.

Although Williams has pledged to work with Beshear, he said during an interview with reporters last week that Beshear has damaged his tenuous relationship with the Senate Republicans by appointing two Republican senators to executive and judicial branch positions last summer and fall in a move designed to thin the ranks of the Republican majority.

“I am not pleased by the governor’s actions,” Williams said.

The Senate leader has accused Beshear of trying to create one financial crisis after another as a way to try to get expanded gambling at the race tracks through the legislature.

“He’s been a one-issue governor up until this juncture,” Williams said.

Williams said that he would like to see the state reduce personnel but he said that he would let the agencies decide on how to make those reductions by giving them a target amount to cut.

“The agencies are going to have a three, four of five percent budget reduction over the next biennium,” Williams said.

Stumbo said Monday that he has talked to several House members about legislation to make changes in the state’s tax system.

“There is some interest in the House to modernize our tax system,” Stumbo said. “I don’t know how widespread that is but it definitely is something we should be looking at in case drastic, harmful cuts are needed. We should be prepared.”

Stumbo said tax modernization “is not an automatic increase in taxes. It’s a fairness issue. If you are paying too little in taxes, then you might get a tax increase. But if you are middle- or lower-income category, you might see a decrease.

“Taxes should be understandable and fair.”

Beshear has said now, in a tough economy, is not the time to consider tax changes.

He is to discuss the state’s financial picture more Wednesday night in his State of the Commonwealth Address.

What will result from the law-making session that is run through mid-April at a daily cost to taxpayers of $65,418.46 is anyone’s guess. As baseball legend Yogi Berra once said, “It’s tough to make predictions, especially about the future.”

–Jack Brammer and Beth Musgrave

Filed Under: David Williams • Democratic Party • Greg Stumbo • KY General Assembly • State Budget • State Government • Steve Beshear