CLX members may contact Leslie Small, Congressman Barr's District Director, by email.
Commerce Lexington Inc. Blog
Congressman Andy Barr visited with members of Commerce Lexington to provide an update on the impact of federal tax reform to local businesses. The Congressman also sought feedback from business leaders about the initial impacts of the reforms. Many in attendance provided feedback about general optimism, plans to invest in expansions, hire new employees or provide bonuses or raises to existing employees. Congressman Barr said there may be a bill that passes at the end of the year to address any clean-up issues with tax reform. He encouraged businesses to provide feedback to his office on positive impacts of the reform, as well as any questions or concerns so those may be addressed.
CLX members may contact Leslie Small, Congressman Barr's District Director, by email.
Crafting the next $20 billion biennial state budget remains the focus for legislators during early days of the 2018 General Assembly. This budget process began on Jan. 16 when Governor Bevin introduced his budget bill (HB 200) to lawmakers. Last week, State Budget Director John Chilton came before members of the House and Senate Appropriations and Revenue Committees to further explain the administration's proposal. During the presentation, Director Chilton reviewed the tough budgeting challenges, such as modest projected tax revenue growth, enormous obligations to public employee pension systems and higher costs associated with prison and Medicaid populations.
Chilton also summarized the Governor's policy and budget priorities, beginning with the commitment to fully fund state employee pension systems ($3.3 billion), Medicaid and keep debt levels below 6%. Both pensions and Medicaid are absorbing a growing share of the state's General Fund revenues and will account for approximately 1/3 of budget spending. Even if a pension reform bill passes this session, any savings would likely not be realized until future years.
It remains to be seen if pension reform or tax reform will be addressed this session. Director Chilton acknowledged the need for comprehensive tax reform and a proposal that could generate at least $2 billion in new revenues to meet the state's growing needs. However, Chilton didn't endorse any specific proposal. Under the current structure, the individual income tax and sales tax generate more than 75% of state General Fund revenues. Other taxes include property, corporate income, cigarette, lottery and LEET. Less than 2.5% growth is expected in tax revenues over the biennium. Additionally, no growth was projected in the state motor fuels tax, which provides the bulk of the revenue for the state road fund. This was attributed to more fuel more fuel-efficient vehicles and low wholesale prices for gas.
Other key points from the presentation included:
U.S. Chamber Expert Provides Special Trade Briefing: Free Trade is Good; Modernize Agreements but Let's Keeping Trading.
This week, Commerce Lexington held a special policy briefing on international trade. Christopher Wenk, the Executive Director of International Policy at the U.S. Chamber of Commerce, led a presentation and discussion about the importance of free trade agreements to Kentucky’s economy, and why members of the business leaders should be engaged in advocating for these agreements at the federal level of government.
Chamber members were given insight on current free trade agreements and how trade creates big markets for small economies. In a global economy, international trade significantly impacts Kentucky's businesses by providing access to new markets.
Kentucky’s top trading markets are Canada, UK, France and Mexico. Therefore, negotiations related to Brexit and the North American Free Trade Agreement (NAFTA) will be important to watch. For example, NAFTA supports 14 million U.S. jobs, including 184,309 Kentucky jobs.
Although the economic benefit is clear and public sentiment toward trade is positive, challenges remain for these agreements. U.S. markets are largely open to imports, but tariffs in developing countries can be much higher, creating a competitive disadvantage. Discriminatory regulations and non-tariff barriers are also a problem. President Trump has expressed concerns about imbalances, particularly with China, and indicated a willingness to withdraw from agreements like NAFTA. While modernizations may be needed to level the playing field, withdrawing from NAFTA could be economically devastating for the U.S. and Kentucky. Wenk said the Administration favors bilateral negotiations with countries over multi-lateral agreements.
Because of Trade Promotion Authority, Congress has a role to play in this debate. Wenk urged the Lexington business community to closely monitor the Administration’s ongoing negotiations and to engage with Kentucky’s Congressional delegation to share real stories about the impact of trade on Lexington businesses.
On July 11-12, Commerce Lexington will be taking a delegation of business leaders to Washington, D.C. for the annual Fly-In. Trade is expected to be a top issue.
For more information about trade, visit http://tradeworksforus.com/.
If you have questions about this issue, or would like to share the impact of trade on your businesses with officials in Washington, D.C, please contact Andi Johnson, CLX Chief Policy Officer, at 859-226-1614 or by email.
State legislators have convened in Frankfort for the 2018 Regular Session of the Kentucky General Assembly. During the 60-day session, the primary focus will be formulating the next two-year state budget. Balancing the budget, as is required by the Constitution, will be an extremely difficult task. Lack of sufficient growth in state revenue to meet Kentucky's needs continues to be a chronic issue. Significant costs for required contributions to the financially troubled public pension systems and Medicaid expansion are predicted to force severe cuts to remaining governmental agencies and programs, including K-12 education. These factors have put more pressure on the need for tax reform to stimulate economic growth and additional revenues.
This past week, both the Kentucky House and Senate met to introduce bills and handle organizational requirements. At this time, a pension reform bill has not been introduced in the House or Senate. The House adopted rules that differed from last year by including a process to establish a bipartisan committee to investigate charges filed by any two members against another member. This rule change was taken advantage of by 8 members who immediately filed charges against House Speaker Jeff Hoover, alleging inappropriate conduct. Last week, Hoover announced he would stand aside from his leadership position until the Legislative Ethics Commission completes its investigation into the same allegations. House Speaker Pro-Tem David Osborne (R-Prospect) continues to serve as the acting Speaker of the House.
It is yet to be seen if the internal issues in the House will impact the progress of legislative priorities, such as pension reform, tax reform and regulation reduction. Governor Matt Bevin is expected to deliver both the State of the Commonwealth and his budget address on January 16.
In 2018, all 100 state House seats and 19 Senate seats will be up for election. The filing deadline for candidates is January 30. Frequently, controversial legislation is not considered until after the filing deadline.
Other priority issues for Commerce Lexington this session include: workers compensation system reforms, medical liability reforms to improve the healthcare economy and essential skills legislation to encourage soft skills development in schools.
Commerce Lexington will be monitoring legislation and providing regular email updates throughout the session to keep you informed about the issues impacting the business community. If you have questions or concerns, you may contact Andi Johnson, CLX Chief Policy Officer, at 859-226-1614 or by email.
Elizabeth Bishop will be working under Commerce Lexington Inc. Chief Policy Officer and Director of Regional Engagement Andi Johnson and the Director of Leadership Development Amy Carrington. She will be completing her final semester of her Master’s Program in Public Policy at the University of Kentucky. With a background and degree in Community Leadership Development and knowledge in Public Policy with a focus in Information Communication Technology she plans to experience the legislative process from the Chambers point of view. Throughout her time here, gaining knowledge and insight about facilitating policy on issues in the city she calls home, will be a valuable experience for both her career and state. We look forward to providing her with the foundation for facilitating and managing many responsibilities to nurture her development.
From taxes and regulation to health care and education to energy and environmental issues, government impacts all aspects of economic development. Businesses leaders are often too busy attracting investments, creating jobs and running operations to focus large amounts of time on monitoring legislation and regulations, analyzing their effect and advocating for their passage, defeat or modification. That’s why – whether at City Hall, the State Capitol, or in Washington – Commerce Lexington Inc. is proud to work on your behalf as an effective public policy voice.
Throughout the year, Commerce Lexington’s Public Policy Council researches, analyzes and discusses important policy issues from the perspective of how it may affect the Central Kentucky business community, then recommends advocacy position statements. The group is comprised of more than 45 volunteer leaders and represents a cross section of Commerce Lexington’s 1,700 member organizations. Commerce Lexington’s Executive Board reviews and approves the Policy Statements recommended by the Public Policy Council.
Please take a few minutes to review the 2018 Legislative Focus to learn about issues we will be tracking on behalf of the business community at the local, state and federal levels this year.
In January, state lawmakers return to Frankfort for a 60-day legislative session. The “long session” occurs in even-numbered years. The primary focus will be on reforms to the state’s financially troubled public pension systems, and the crafting of the next $20 billion two-year state budget and road plan. Tax reform is also expected to be discussed. Without pension or tax reform, the Governor and General Assembly members may have to make significant cuts to state government to balance the state’s budget as is required.
Other priority issues include: workers compensation system reforms, medical liability reforms to improve the healthcare economy and essential skills legislation aimed at focusing schools on soft skills development. Commerce Lexington will be hosting its Annual Evening in the Bluegrass on February 22 at Berry Hill Mansion from 5:00 p.m. – 7:30 p.m. The reception offers members with the opportunity to engage with legislators and administration officials.
At the local level, Commerce Lexington will continue to monitor regulatory, environmental and other economic development issues. The chamber continues to be focused on local and state policy efforts to improve the education and workforce development systems. This includes the partnership with the Business and Education Network (BEN) and work to identify current and future workforce needs and develop a plan to meet those needs through collaborative community partnerships such as the Fayette County Public Schools Career Academies.
In July, Commerce Lexington will take a delegation of regional business and community leaders to Washington, D.C., for a two-day Fly-In. The visit will include meetings with members of the Kentucky Congressional Delegation and their staffs to discuss the impact of federal policies on local businesses.
Commerce Lexington will also host the Public Policy Luncheon series presented by Kentucky American Water. The purpose of the events is to educate members about key policy issues and offer opportunities for members to engage with key policy leaders.
HOW TO CONTACT LEGISLATORS:
FOR MORE INFORMATION:
If you have questions, need assistance with a policy issue, or would like to get involved with advocacy efforts, contact Andi Johnson, Chief Policy Officer and Director of Regional Engagement, at [email protected] or (859) 226-1614.
News and notes about Commerce Lexington Inc., Lexington KY, and the Bluegrass Region, including key policy issues that impact business.