FRANKFORT, Ky. (AP) — Gov. Steve Beshear said Tuesday he's encouraged that lawmakers are discussing a variety of revenue sources to bolster Kentucky's financially troubled pension system for government retirees.
The second-term Democrat said he's good with one of the latest options being floated in Frankfort, allowing slot-like machines to be installed at horse racing racetracks statewide and taxing the proceeds to generate cash for pensions.
In Kentucky, actual slots are banned, but two horse tracks have installed similar "Instant Racing" machines that allow people to wager on the outcomes of past horse races.
House Speaker Greg Stumbo said he believes Instant Racing could generate wagers totaling $1 billion a year if expanded to additional tracks. Taxing those wagers could produce some $30 million for pensions.
Some lawmakers contend that the Legislature should wait on the Instant Racing proposal until the Kentucky Supreme Court rules on its legality. The state's highest court announced in January that it would review a trial court's ruling that Instant Racing is legal. Critics contend the machines are no different than illegal slots.
"I've been a supporter of Instant Racing for several years," Beshear said Tuesday. "Obviously, it's not a panacea for leveling the playing field like casino gaming would be. It helps some, and I hope that the Kentucky Supreme Court upholds the court decision so we can continue to have instant racing in the state."
Senate Republican leaders said last week that any legislative action should wait until the Supreme Court rules.
Stumbo told reporters that Instant Racing could be one option for shoring up the state's pension system, which has a $33 billion unfunded liability. House Democrats also may consider increasing the state's cigarette tax from 60 cents to $1 a pack in a move that Stumbo said could generate $100 million a year for the pension system.
Beshear said that he and Stumbo agree that the Legislature needs to identify a funding source for making the state's contribution to the pension system. He said he doesn't want lawmakers to try to force cuts to other government services to fund pensions.
"We've cut $1.6 billion out of our budget over the last five years," Beshear said. "There aren't any more big pots of money, and so if we don't create the funding for the pension solution, then what we'd have to do is take it out of education and a lot of other places and I'm not willing to do that. So I appreciate the speaker just trying to look at different kinds of solutions."
Beshear said a proposal to get lawmakers to pass a constitutional amendment to legalize casino gambling to generate cash for pensions and other government programs appears to be going nowhere this year. Senate Republicans said last week they won't take up the issue.
"So, I don't see that as being part of this discussion at this point," he said.