Snow days, ‘P3s’ and budget goes to Conference Committee

By Sara Beth Gregory, 16th District Senator

After much debate, a compromise was reached regarding snow days and how school districts can make up missed time. The compromise plan contained in House Bill 211 protects both students and taxpayers while giving districts flexibility. Under the new plan, June 6 will be the official last day of school, although districts may go beyond that date if they choose.

Schools will submit a plan by May 1 to the Commissioner of Education detailing their efforts to make up missed days to reach the minimum 1,062 hours of instructional time for students. For districts that cannot reach the required 1,062 hours, the Commissioner may waive the time that remains. The bill also provides that a district may be open on Primary Election Day if no school in the district is used as a polling place.

On Thursday, I presented House Bill 407 in the Senate. HB 407 will give the Commonwealth a new tool in the toolbox to proceed with projects for both state and local governments, even in lean financial times. This tool is public-private partnerships, also known as “P3s.” Simply put, a public-private partnership is a contractual agreement between public and private entities to complete a project or provide a service used by the public. Involving the private sector can save tax dollars while providing specialized expertise and improving efficiency. All of Kentucky’s surrounding states already have P3 enabling laws in place.

House Bill 407 is tailored to provide legislative oversight and transparency in the contracting process. The legislation is also focused on job creation, and the Senate amended the bill to ensure that potential contractors are required to outline their use of Kentucky-based employees and services. On Friday, the House concurred with these changes, which means the bill now goes to the Governor for signature. I’m proud to have played a role in passing what the Kentucky Chamber of Commerce has called “the greatest bill to advance this session to support job creation.”

Also this week, the budget process took another step forward as the Senate passed its version of the new two-year budget for the Commonwealth. As expected, there are a variety of differences between the House and Senate budget proposals. Because of the differences in the proposals, conference committees are now reviewing the Executive, Judicial and Legislative budgets for the next two years, as well as the state’s road plan. There are many different opinions and philosophies on how to spend the money, raise revenue, and support the important public services for Kentucky.

Senate members worked many late nights to create a more fiscally responsible budget than the House plan. The Senate’s proposal greatly reduced the proposed amount of borrowing and sought to use money more efficiently. It lowered the debt service ratio (the percent of current revenue we direct to paying debt) from 7.05 percent to 6.26 percent. The Senate budget would also increase the budget reserve trust fund, or “rainy day fund” to $125 million. It further reduced the structural imbalance (the amount by which current spending is more than recurring revenue) from a proposed $231 million to $153 million.

The Senate budget also specifies that no money from the state’s General Fund can be used for the implementation of Obamacare through the health benefit exchange, and if the federal government changes the state’s obligation under Obamacare, we can opt out of both the health benefit exchange and the expansion of Medicaid.

Although there were many good things about the Senate’s budget proposal, I cast a no vote on the measure due to concerns about the allocation of certain funds and language provisions in the budget. I hope these may be addressed in the final budget.

Though we had differences, the House and Senate agreed on certain aspects. Both chambers agreed to fully fund the actuarially required contribution of the Kentucky Employees’ Retirement System and the Kentucky State Police Retirement System. Both also agreed to include raises for State employees for 2015 and 2016. In one difference, the House budget mandated pay raises for teachers, but the Senate plan left those raises to the discretion of local districts based on concerns that many school districts would lack sufficient funds.

The budget bill is a lengthy, all-encompassing document that is difficult to explain in a few paragraphs, but I encourage you to contact me about any specific points of interest or concern. As the conference committee on the budget continues meeting, I am hopeful a compromise will be reached to fund needed state services while maintaining fiscal responsibility.

As always, I invite you to contact me with feedback about legislative issues that interest you. You may contact me in Frankfort at 502-564-8100, by calling our toll-free message line at, 800-372-7181, or by e-mail at sara.gregory@lrc.ky.gov. More information about the work of the Legislature is available on the Legislative Research Commission website, www.lrc.ky.gov, and you may also watch legislative proceedings live online at www.ket.org.