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Cha-Ching! State begins new fiscal year on positive note

By Jack Brammer

jbrammer@herald-leader.com

FRANKFORT — Kentucky’s new fiscal year is getting off to a positive start.

State budget director Jane Driskell reported Monday that Kentucky’s General Fund, which pays for most programs, saw its receipts total $705.9 million in July, a 2.2 percent increase over the same month last year.

July was the first month of the state’s new 2015 fiscal year.

When the last fiscal year ended June 30, Democratic Gov. Steve Beshear had to plug a $91 million shortfall in the state’s $9.5 billion budget after a year of sluggish collections on state income taxes.

He did that by dipping into budget accounts of several state agencies, taking $21.2 million from the state’s $98.2 million” rainy day” or emergency fund and cutting $3 million in state spending.

Driskell said the General Fund growth of 2.2 percent in July is “a positive sign – especially since our two largest taxes – individual income and sales tax – grew at robust levels of 5.9 percent and 7.6 percent, respectively.

“Our expectations are that the underlying economic momentum continues to build.”

The official revenue estimate for fiscal year 2015 calls for revenue to increase 3.6 percent compared to last year’s actual receipts.

Based on July’s results, General Fund revenues need to increase 3.7 percent for the remainder of the fiscal year to meet the official estimate.

Among the state’s major accounts in July, individual income tax receipts rose 5.9 percent, sales tax revenue grew 7.6 percent, cigarette tax collections rose 2.3 percent and the payment to the state from the lottery increased by 3.1 percent.

But corporation income tax collections fell 64.6 percent. The state attributed that to a large one-time payment received in July 2013.

In July 2014, coal severance tax revenues declined 14.8 percent and property tax receipts fell 45 percent. Driskell noted that a small share of property tax receipts is received in July.

Driskell also announced that Road Fund revenues for July totaled $125.4 million, an increase of 5.1 percent compared to last July.

“Growth in the important Road Fund accounts was small but positive in July,” she said. “That is good news given that the forecast for fiscal year 2015 has Road Fund receipts declining slightly.”

For July, motor fuels tax receipts rose 2.8 percent, motor vehicle usage tax jumped 1.4 percent and license and privilege taxes grew 36.3 percent. Non-tax receipts dropped 30.9 percent.

The official revenue estimate for this new fiscal year calls for revenues to decline 0.9 percent compared to last year’s actual receipts.

Based on July’s receipts, revenue can fall 1.4 percent for the rest of the fiscal year and still meet budgeted levels.

Kentucky shows deep drop in uninsured adults under federal health law

Gov. Steve Beshear delivers his 2014 State of the Commonwealth speech on Jan. 7, 2014, in Frankfort. Photo by Mark Cornelison | StaffBy Jack Brammer
jbrammer@herald-leader.com

The percentage of adults without health insurance in Kentucky has dropped to less than 12 percent, the second largest decline among the states since the federal Affordable Care Act took effect in January, a new poll shows.

Kentucky’s uninsured rate dropped from 20.4 percent last year to 11.9 percent halfway through 2014, a decline of 8.5 percentage points, according to a Gallup Poll released this week.

Only Arkansas saw a larger decline.

“From day one, Kentuckians swarmed our exchange, kynect, eager to gain health insurance coverage, some for the very first time in their lives,” Gov. Steve Beshear said in a statement Wednesday touting the new poll. “To see this steep decline in the uninsured rate in such a short period of time reaffirms that kynect is working and we made the right decision for the health and well-being of our citizens.”

President Barack Obama and others have hailed kynect as a national model since it was launched Oct. 1.

At the close of open enrollment on April 15, more than 413,000 Kentuckians had enrolled in health care coverage through kynect. The majority received Medicaid, the government-funded insurance program for the poor and disabled, but more than 82,000 purchased a private insurance plan. Of those, the state said 74 percent qualified for some level of financial assistance to help with their premium costs.

Surveys of kynect enrollees revealed that about 75 percent of applicants who signed up during the initial open enrollment period reported they did not have health insurance prior to signing up for coverage through kynect.

As of July 31, more than 521,000 Kentuckians had enrolled in health care coverage through kynect, Beshear said.

Individuals who qualify for Medicaid may visit kynect to enroll in coverage at any time. Only those individuals who experience a qualifying event, such as the loss of employer-sponsored health insurance coverage, may purchase a private health insurance plan outside of the open enrollment period.

The next open enrollment period begins Nov. 15, for coverage effective Jan. 1.

Gallup’s poll is the first nationwide survey of the uninsured in all 50 states and the District of Columbia. Results were based on telephone interviews with a random sample of more than 178,000 adult Americans.

Lawmaker takes issue with Stumbo’s comments on Ark park

State Rep. Brian LinderBy Jack Brammer
jbrammer@herald-leader.com

FRANKFORT — State Rep. Brian Linder, R-Dry Ridge, expressed disappointment Thursday over House Speaker Greg Stumbo’s comments this week that the state should not provide tax incentives for a Noah’s Ark theme park in Grant County.

Linder, who represents Grant, Gallatin and Owen counties in the House’s 61st District, said in a news release that Stumbo’s comments “appear to tell those who want to bring economic opportunity to the commonwealth that Kentucky is closed for business, which only serves to further drive other businesses out of our state.”

Stumbo, D-Prestonsburg, said earlier this week that Grant County needs more economic development but that the use of tax incentives for the park is unconstitutional because it violates the U.S. Constitution’s mandate for separation of church and state.

He predicted that the incentives will be challenged in court and the state would lose.

The Kentucky Tourism Development Authority has given its preliminary approval for as much as $18.25 million in tax incentives for the $73 million first phase of the biblical theme park. It is to consider final approval after a feasibility study is conducted.

The park is to open in two years and will feature a wooden ark 510 feet long, 85 feet wide and 55 feet high. It is affiliated with Answers in Genesis, which runs the Creation Museum in Boone County. The museum follows a literal interpretation of the Bible and the belief, contrary to science, that the Earth is only 6,000 years old.

Linder said the proposed Ark Encounter theme park is a tourism-based economic development project that qualifies to receive tax incentives from the state. He said millions of dollars have already been allotted for highway improvements in the area of the proposed theme park’s location

“While Kentucky continues to lose jobs to places like Ohio, Indiana, Tennessee, and Texas, Speaker Stumbo chooses to attack an economic development project in my community by encouraging lawsuits on tax incentives,” Linder said.

Linder said Democratic Gov. Steve Beshear and others are supporting the project “because they understand the huge economic benefits it can bring to the Commonwealth, yet Speaker Stumbo would rather stir up issues instead of considering the opportunities this project will provide to Kentucky families.”

Linder called Stumbo’s comments about the park and religion disingenuous.

“While the Speaker has an issue with a religious theme park receiving tax incentives to provide jobs, he apparently has no problem occupying a chair in the House chambers that has, in large letters, the motto ‘In God We Trust’ behind it,” he said.

Beshear sets up group to help communities hit by natural disasters

HERALD-LEADER FRANKFORT BUREAU

FRANKFORT — Gov. Steve Beshear, by executive order Wednesday, created the Council for Community Recovery and Resiliency or CCRR, a new group that will provide support, leadership and guidance to Kentucky communities drastically impacted by natural disasters.

“Kentuckians have faced an unparalleled number of natural disasters in the past several years – from devastating storms and tornadoes, to dilapidating droughts, to extreme snow, ice and flooding,” Beshear said in a release.

“Through coping with these terrible disasters, Kentucky has developed strong and effective response systems and implemented quality preparedness measures across the state. This new council is another way for Kentucky to stay ahead of the game in natural disaster response.”

The council will be a main resource for communities before, during and after they are affected by disasters – helping them employ the best our state can offer in preparedness, response and recovery, Beshear said.

It also is to serve as an advisory and resource board for Kentucky communities, providing them with technical and financial expertise in preparing and responding to natural disasters.

The group is to be attached to the Department for Local Government and include representatives from several state agencies, including Cabinet for Health and Family Services, Cabinet for Economic Development, Division of Emergency Management, Transportation Cabinet, Kentucky Association of Counties, Kentucky League of Cities, Kentucky County Judge-Executive Association, Kentucky Association of Area Development District Directors and Kentucky Office of Homeland Security.

During Beshear’s administration, Kentucky has had 11 federally declared natural disasters that have caused deaths, injuries and extreme financial loss and destruction to communities across the state.

–Jack Brammer

‘Comment’ will discuss budget shortfall; ‘KY Tonight” will focus on economy

Gov. Steve Beshear’s handling of the state budget shortfall will be one of the topics on this weekend’s “Comment on Kentucky,” a public affairs show of the Kentucky Educational Television network.

Joining interim host Bill Bryant of Lexington’s WKYT-TV to discuss recent news in Kentucky will be three journalists — Tom Loftus of The Courier-Journal, Phillip Bailey of WFPL in Louisville and Nick Storm of cn|2 in Louisville.

The show airs live at 8 p.m. Friday on KET.

On the Monday, July 21 edition of “Kentucky Tonight” at 8 p.m. p.m. on KET and at KET.org/live, host Renee Shaw (substituting for Bill Goodman) and guests will discuss jobs and the economy.

Scheduled guests are John Garen, economics professor at the University of Kentucky; Chris Phillips, economics professor at Somerset Community College; Tom Dupree, member of the board of the Bluegrass Institute for Public Policy Solutions; and Anna Baumann, research and policy associate with the Kentucky Center for Economic Policy.

Viewers with questions and comments may send e-mail to kytonight@ket.org or use the message form at KET.org/kytonight.

Viewers may also submit questions on Twitter @ReneeKET or on KET’s Facebook page, facebook.com/KET. All messages should include first and last name and town or county. The phone number for viewer calls during the program is 1-800-494-7605.

“Kentucky Tonight ” programs are archived online, made available via podcast, and rebroadcast on KET and KET KY. Archived programs, information about podcasts, and broadcast schedules are available at KET.org/kytonight.

“Kentucky Tonight” is a weekly KET production, produced by Deidre Clark. Goodman is host and managing editor.

–Jack Brammer

Beshear makes appointments to state education board, women’s commission and arts center

HERALD-LEADER FRANKFORT BUREAU

FRANKFORT —Gov. Steve Beshear has made appointments to the Kentucky Board of Education, Kentucky Commission on Women and the Kentucky Center for the Arts Board.

To the state education board, Beshear has appointed Shelbyville attorney Samuel D. Hinkle IV and retired educator Debra L. Cook of Corbin.

Hinkle replaces Judith H. Gibbons, whose term has expired. His term will run through April 14, 2018. Cook replaces Brigitte B. Ramsey, who has resigned. She will serve for the remainder of Ramsey’s term, which ends April 14, 2016.

Andy Beshear reports $1.1M on hand for attorney general race, picks up endorsements

By Jack Brammer

jbrammer@herald-leader.com

FRANKFORT — Andy Beshear, a Democratic candidate for attorney general in 2015 and the son of Gov. Steve Beshear, reported Thursday that his campaign has nearly $1.1 million cash on hand, after raising $160,000 in the last three months.

Beshear, a Louisville attorney with Stites and Harbison, has raised more than $1.26 million total for his campaign. He started it last November.

The candidate also announced the endorsements of five prominent Democrats for his campaign – former Attorney Generals David Armstrong and Chris Gorman, state Auditor Adam Edelen, former state Auditor Crit Luallen and state House Speaker and former Attorney General Greg Stumbo.

Beshear reappoints 6 members to state education board

FRANKFORT — Gov. Steve Beshear reappointed six members of the 12-member Kentucky Board of Education Tuesday.

Two other appointments are up but he will announce them at a later date, said Beshear spokesman Terry Sebastian.

The reappointments will serve through April 14, 2018.

They are Jonathan V. Parrent of Princeton, William L. Twyman of Cave City, Roger Lee Marcum of Bardstown, Mary Gwen Wheeler of Louisville, Nawanna B. Privett of Lexington and Grayson R. Boyd of Williamsport.

–Jack Brammer

State expects $57 million net gain over three years from tobacco settlement



By Jack Brammer

jbrammer@herald-leader.com

FRANKFORT — Kentucky will reap an extra $57.2 million over the next three years from settling litigation involving the 1998 Master Settlement Agreement between states and tobacco companies, Gov. Steve Beshear and Attorney General Jack Conway announced Thursday.

In a joint news conference in the Capitol, Beshear said the end of the legal dispute between 23 states, including Kentucky, and tobacco manufacturers over 10 years of disputed claims and litigation is “a victory not only for Kentucky farmers, but also for critical health care and childhood services.”

Conway said the settlement his office worked on “restores certainty to Kentucky’s annual payments” from the 1998 agreement.

“Under the terms of the settlement, we avoid the possibility of costly litigation and the potential loss of the entire annual Master Settlement Agreement payment.”

Money from the settlement agreement already is designated for farm projects and health issues like lung cancer research.

Beshear acknowledged that the extra money for the state will not have an impact on a budget shortfall Kentucky expected at the end of this fiscal year on June 30.

Kentucky faces revenue shortfall in General and Road Funds

By Jack Brammer
jbrammer@herald-leader.com

FRANKFORT — State government is raking in less tax revenue than expected, making a budget shortfall for the fiscal year that ends June 30 “inevitable,” state budget director Jane Driskell warned Tuesday.

Driskell said the state’s General Fund which pays for most state programs, and the Road Fund, which pays for road work, would fall short of expectations. She said the magnitude of the shortfall will not be known until early July, but that it would be “significantly larger” than $28 million.

“We are preparing for the year-end close out, directing state agencies to closely monitor all activities and reviewing all potential options to address the shortfall;” she said.

Driskell reported Tuesday that May’s receipts for the General Fund fell 2.1 percent compared to May 2013. Total revenue for the month was $777.3 million, compared to $793.9 million during May 2013.

General Fund receipts grew 1.1 percent during the first eleven months of the fiscal year, but the enacted budget calls for 2.2 percent revenue growth for the entire fiscal year.

To meet the official revenue estimate, receipts must increase 11.7 percent over the final month of the fiscal year.