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June Interim Update

The 2019 Interim session got underway last week in Frankfort. Legislative leaders adopted a new approach to the interim committee meeting schedule, choosing to schedule all interim meetings during the same week of each month. Previously, committees met throughout the month. We've already noticed – and you'll see from this summary - that this change in schedule provides more of a "session feel" during the week that the committees meet. You can access the new interim committee schedule HERE.  

Political Highlights

Special session chatter escalated as Governor Bevin issued a letter to all members of the General Assembly outlining his administration's concessions to a proposed bill intended to provide relief to quasi-governmental entities for increased pension costs. House Speaker David Osborne, however, issued a response that he doesn't believe that the primary concerns have been addressed and indicated that a special session may not happen before the new fiscal year begins July 1. Earlier in the week, Senator Damon Thayer made similar comments.

June Interim Committee Summaries

We want to provide the most useful information and have worked to include more detail for those committees that are of particular interest to our clients. We look forward to your feedback and are happy to customize based on your needs! Please see the following summaries for each of the committees that met. Don't hesitate to let us know if you have questions or would like additional information on topics discussed.

Medicaid Oversight and Advisory Council

The Medicaid Oversight Committee met briefly, to nominate and elect the new chairs for the upcoming year. Senate members elected Sen. Stephen Meredith as the Senate co-chair and House members elected Rep. Daniel Elliot as the House co-chair. Rep. Elliott is an attorney in Danville and Sen. Meredith is a retired hospital executive from Leitchfield. The next meeting will be held on July 8th and it is expected that the committee will hear updates from the Cabinet for Health and Family Services on new MCO contracts and an update on SB 5 implementation.

Health and Welfare

The IJC on Health and Welfare met last Monday afternoon and with a full agenda. You can access the agenda and all meeting materials HERE.  CHFS Deputy Secretary Putnam shared that the Cabinet is in the process of seeking an amendment to the Medicaid state plan that will allow for payment of qualifying physical and mental health services in schools.  The committee also heard updates on several programs established through grant awards. Additionally representatives from the Lexington Policy and Fire departments presented on the benefits of crisis intervention teams and their community paramedicine unit. The Office of Homelessness Prevention and Intervention presented alongside the Executive Director of the Homelessness and Housing Coalition of KY to discuss the impact of mental health on homelessness and efforts that are underway to address these growing problems across the Commonwealth. The meeting materials contain information on other items discussed during this interim committee meeting.

For a full meeting summary click HERE.

Transportation

The IJC on Transportation met and heard presentations from Transportation Cabinet officials.

Secretary Thomas provided an update on design build projects and focused on a grouping of four major projects on the interstate system through Jefferson County.  The four projects are 1) Widening of I-71; 2) Widening of I-265; 3)  I-71, I-265 Interchange; 4) I-64, I 265.  

The four projects together are being grouped under a design build approach that was authorized under legislation in 2018.  Collectively this is a $188 million project with a compressed project schedule that will complete in fall of 2023. Secretary Thomas' presentation is available HERE.

Appropriations and Revenue

On Tuesday, many of the Budget Review Subcommittees met, as well as the full IJC on Appropriations and Revenue.  A listing of the BR Subs and short summaries are as follows:

BR Subcommittee on Justice – Discussion on Implementation of SB 120

BR Subcommittee on Justice met and heard testimony on the implementation of SB 120. Presenting were Justice Cabinet Secretary John Tilley and various cabinet officials. The presenters touched on a number of pertinent topics from jail funding, re-entry programs, prison enhancement programs, and county jails.  

For a full meeting summary click HERE.

BR Subcommittee on Economic Development, Tourism, and Environmental Protection

The Subcommittee heard presentations from the Tourism Arts and Heritage Cabinet  (TAH) and the Public Protection Cabinet (PPC). Presentations can be accessed HERE

Speaking for TAH was Cabinet Secretary Don Parkinson, Deputy Secretary Regina Stivers, and Finance Director Chris Reece.  These officials gave an overview of the agencies included in the Cabinet and budget updates for the various agencies. The Presentation concluded with Secretary Parkinson discussing priorities for the next budget cycle, while recognizing that the Cabinet is very early in the budgeting process.

Presenting for PPC were Secretary Gail Russell, ABC Commissioner Carol Beth Martin, and Director Matthew Thacker with the Office of Administrative Services. Following an overview of agencies within the Cabinet, the presenters shared that the Budget priorities for the next budget session including for its agencies, like: Charitable Gaming, Department of Insurance and Department of Financial Institutions.

For a full summary click HERE.

Budget Review Subcommittee on General Government

The only agenda item for this subcommittee was a presentation by Chuck Grindle, the Chief Information Officer at the Commonwealth Office of Technology. He provided a budget overview for COT. The presentation is available HERE

Budget Review Subcommittee on Human Services

This month's meeting focused on the Department for Community Based services with an overview of funding for child welfare services by Commissioner Clark. Subcommittee members also heard from officials with the Family Resource and Youth Service Centers with an overview of funding. Presentations on both topics can be accessed HERE.

Budget Review Subcommittee on Transportation

Transportation Cabinet officials provided subcommittee members with two updates. The first was an update on two grant programs –BUILD and INFRA – and projects that have been identified to be funded through each program. Additionally, State Highway Engineer Andy Barber and Project Manager Royce Meredith updated the committee on the Bridging KY Program.

Bridging Kentucky is a statewide program designed to restore, rehab, repair, or replace deficient state, county, and local bridges. Goals include restoring structures to appropriate capacities, focus on safety and soundness, and deliver all bridges for construction by 2024. The cost is roughly 700M, restoring 1000 bridges over a 6-year period. More detail is provided on this topic and the grant programs mentioned above HERE

Appropriations and Revenue Committee

The Presidents of Kentucky's two research universities, the University of Kentucky and University of Louisville presented to the IJC on A&R. President Eli Capiluto discussed UK's research projects on dementia and opioid abuse and also touched on budget requests for the next budget session. President Neeli Bendaupudi made her inaugural appearance before the committee and presented on UofL's research efforts as well as budget requests. Performance funding was a topic that both addressed and while they voiced support for this relatively new way to fund postsecondary institutions there was also recognition that more dollars are needed in the system.

Representatives, including Senator Givens brother, from Auburn University presented on the long-standing partnership with the Commonwealth to provide in-state tuition to students attending Auburn's veterinary school. A shortage of funds from the state to Auburn to cover the cost of Kentucky student "slots" was the theme of the presentation and a soft ask by Auburn for Kentucky to budget for the full cost of the slots in this next budget cycle.

All presentations can be found HERE

Education

The Interim Joint Education committee met and heard testimony on early childhood education and homeschooling. There was also opposition testimony to the social studies standards reg from Dick Innes, Bluegrass Institute, but there was no action on the reg and no legislator questions.  Linda Hampton, Governor's Office of Early Childhood gave an overview of Early Childhood Education in Kentucky, her slides are HERE. The Homeschooling Presentation was a repeat of an OEA presentation of their report on homeschooling that can be found HERE.

For a full summary click HERE.

Economic Development and Workforce Investment

Recently named Acting Secretary of Economic Development, Vivek Sarin, presented on the status of the State's Economic Development programs.  The Secretary focused on workforce needs, permitting needs, and access to new/existing suppliers/customers. He also discussed his cabinet's budget needs.

Dr. Jay Box, President Kentucky Community and Technical College System, gave a presentation on the Work Ready Kentucky Scholarship program and how SB 98 (2019) expanded the program to include awards for summer terms, eligibility from secondary to postsecondary if a student uses for dual-credit classes, and removes the requirement for Dual Credit Scholarships be used first.   

Additional information can be found in the meeting materials HERE and a full meeting summary is available HERE.

Economic Development and Workforce Investment - June

Recently named Acting Secretary of Economic Development, Vivek Sarin, presented on the status of the State’s Economic Development programs.  The Secretary focused on workforce needs, permitting needs, and access to new/existing suppliers/customers. The Cabinet is in the process of revamping a strategy to assist small businesses through the creation of Regional Innovation for Startup and Entrepreneur (RISE) offices as well as creating Commonwealth Commercialization Center (C3) to commercialize intellectual property and technology coming from universities.  In addition, they are incenting high-tech startups to locate in Kentucky by matching federal high-tech funds.  The Cabinet has also processed 300 plus companies for Kentucky Economic Development Finance Authority and Bluegrass States Skills approval.  They have also assisted 173 companies in receiving Small Business Tax Credits.  By the numbers, the Cabinet has assisted with $13 Billion in new investments, 767 announced new or expanded projects involving 39,000 jobs the last three years.

When asked what his team need from the Legislature, Sarin mentioned the following:
-Their own revenue source to create a “war chest” to compete with other states.
-Passage of pension reform. He said that investors are concerned about the impact to the states financial stability
-Property readiness

Dr. Jay Box, President Kentucky Community and Technical College System, gave a presentation on the Work Ready Kentucky Scholarship program.  The program was created by Governor Bevin in 2016 by Executive Order and recently made permanent by Senate Bill 98 in the 2019 session.  The program helps Kentuckians who have not yet earned an associate degree afford an industry-recognized certificate or diploma.  Recipients of the scholarships must be approved in a program that leads to an industry-recognized certificate.

SB 98 expanded the program to include awards for summer terms, eligibility from secondary to postsecondary if a student uses for dual-credit classes, and removes the requirement for Dual Credit Scholarships be used first.  Scholarships are available in high-demand sectors identified by the Workforce Development Cabinet.  Five high demand sectors are: Advanced Manufacturing; Health Care; Transportation; Business Services and Construction.

There’s been a 148% increase in scholarship awards since the fall of 2017. Spring of 2019 recipient demographics show:

60.7% of recipients are male
92.3% are in the 18-44 age group
8.8% minority 
$1,570 average scholarship

Additional information can be found in the meeting materials HERE

Interim Joint Education Committee - June

The Interim Joint Education committee met and heard testimony on early childhood education and homeschooling. There was also opposition testimony to the social studies standards reg from Dick Innes, Bluegrass Institute, but there was no action on the reg and no legislator questions. 

Linda Hampton, Governor's Office of Early Childhood gave an overview of Early Childhood Education in Kentucky, here slides are HERE and the relevant points and legislator questions are below:

- ESSA Preschool Development Grant - KY received $10.6 planning grant 1 year. Poised to receive continuing funding for actual work that is expected to be over $20 million for multiple years
- Gave multiple examples of counties where schools and child care centers working together on grant applications by collaborating on services

- NGA grant of $25,000 related to prenatal-3rd grade to align education standards.

Homeschooling Presentation - This was a repeat of an OEA presentation of their report on homeschooling that can be found HERE. The committee seemed interested in general about 2 items based on their questions: 1. Should there be more standards for homeschool teachers and 2. How do you prevent parents from claiming they are homeschooling a student mid-year after several absences have occurred. 

BR Subcommittee on Economic Development, Tourism, and Environmental Protection - June

The Subcommittee heard presentations from the Tourism Arts and Heritage Cabinet  (TAH) and the Public Protection Cabinet (PPC).  Presentations can be accessed HERE.

Speaking for TAH was Cabinet Secretary Don Parkinson, Deputy Secretary Regina Stivers, and Finance Director Chris Reece.  These officials gave an overview of the agencies included in the Cabinet and budget updates for the various agencies. There was a more detailed update on the KY Department of Parks “Restoring the Finest” program which is focused on necessary improvements to parks across Kentucky and a look at how funding as been allocated to this point as well as future plans to continue needed improvements. Specifics can be found in the presentation. The Kentucky Horse Park and Kentucky Venues also provided updates. The Presentation concluded with Secretary Parkinson discussing priorities for the next budget cycle, while recognizing that the Cabinet is very early in the budgeting process.

Presenting for PPC were Secretary Gail Russell, ABC Commissioner Carol Beth Martin, and Director Matthew Thacker with the Office of Administrative Services

Following an overview of agencies within the Cabinet, the presenters shared that the Budget priorities for the next budget session will be:

Maintain baseline appropriations for all agencies, plus additional increase in defined calculations as determined by Office of State Budget Director.
Ask for additional revenue/flexibility for the Housing Buildings and Construction Division of Fire Prevention.
Appropriations increase for KY Horse Racing Commission.

Of the Agency Updates, the following items of interest were mentioned:

Department of Insurance
20M in General Fund transfers
Have received a federal grant to review healthcare cost drivers in the individual market
In the process of implementing a handful of reforms to increase agent licensing efficiency and decrease costs for agents

Department of Charitable Gaming – Initiatives include:
Eliminating or amending 100% of regulations
Improved online training opportunities
Increased focus that gaming is conducted by legitimate charitable organizations.

Department of Financial Institutions
3M in General Fund transfers
Partnering with other agencies to provide training and outreach to consumers and licensees
Implementation of the Nationwide Multistate Licensing System