FRANKFORT, Ky. (AP) — From reforming the state's tax code to shoring up the pension plan for government retirees, lawmakers will face some hefty issues after they convene a legislative session on Tuesday.
The load could grow even bigger if lawmakers tack on the always-divisive issue of legislative redistricting, which they didn't get finished last year.
"It will be tough, but we can get it all done if we get in there and roll our sleeves up," said state Rep. Steven Rudy, R-Paducah. "I hope we can work together and find common ground. All of the issues that are out there, we all know we have to address them."
For the past year, lawmakers have been focused on the state's pension system, trying to find a way to deal with a $33 billion unfunded liability. A legislative task force that spent months studying the issue recommended pumping in more money without saying where the money would come from.
That task force rejected a proposal by the Pew Center on the States to issue bonds to cover the cost. But its members suggested two options that could help: repealing cost-of-living increases for retirees and moving state employees to a hybrid plan similar to a 401(k) that blends defined benefits with defined contributions.
Gov. Steve Beshear said he's taking a closer look at the proposed hybrid plan. "I'm open to that kind of idea," he said last week.
Beshear said he's also hopeful lawmakers can pass a package of tax reforms, saying most people have come to realize Kentucky needs more revenue. A group of experts appointed by Beshear to review the state's tax code proposed a model that would generate about $690 million a year in additional revenue.
The governor had asked the group to recommend a simpler tax code that would generate enough revenue to meet the state's needs even during economic recessions, the last of which led to about $1.6 billion in state budget cuts.
Beshear also wants lawmakers to consider legalizing casino-style gambling as a way to generate cash. But he sounded less than optimistic last week about the chances of getting that through the legislature this year.
In another potentially time-consuming move, House Speaker Greg, Stumbo, D-Prestonsburg, wants to pass legislation that would hold accountable more than 1,200 special taxing districts that spend some $2.7 billion a year. Taxing districts, which collect money to operate everything from rural fire departments to libraries, have proliferated across Kentucky during the past 50 years with little accountability. Stumbo said creating a stronger system of oversight is critical.
Legislative leaders still are debating whether to take on redistricting this year.
Stumbo wants to move as quickly as possible to redraw boundaries around legislative districts. Incoming Senate President Robert Stivers, R-Manchester, said lawmakers aren't rushed because the next round of legislative elections isn't until 2014.
A legislative redistricting plan approved last year was later rejected by the Kentucky Supreme Court. Justices found that the districts were not balanced by population and had to be reworked to comply with the "one person, one vote" mandate in federal and state law.
Redistricting is supposed to occur every 10 years to account for population changes found by the U.S. Census Bureau. Kentucky's overall population grew from 4 million to 4.3 million, requiring a major reconfiguration of legislative districts to make them nearly the same size.