The Kentucky General Assembly will begin the first part of the 2013 30-day session Jan. 8, and Sen. R.J. Palmer, D-28, said tax reform, the possible legalization of hemp and school safety could all be targeted by legislators.
“I have discussed with a number of legislators the need or the idea for tax reform. I think you’re seeing growing consensus that we need to do something,” Palmer said.
On Dec. 17, the Blue Ribbon Commission on Tax Reform submitted recommendations to Gov. Steve Beshear and legislators for review. The governor formed the commission, led by Lt. Gov. Jerry Abramson, earlier this year to look at the state’s tax code and suggest changes. Lawmakers can use the recommendations as the basis for legislation, and Palmer said he is especially interested in the possibility of broadening the state’s tax base.
“That is something I want to look at. ... What if we broaden the base and lower the rate?” Palmer said.
The commission report recommends applying the sales tax to selected services, including services connected to a product already taxed and services specific to Kentucky. The report also recommends increasing the cigarette tax to $1 and taxing luxury items.
With the increased tax base, Palmer said, it may be possible to lower the corporate and income tax rates.
The commission’s recommendation for a state earned income tax credit also is something Palmer is interested in reviewing. A state earned income tax credit, similar to the federal earned income tax credit, would extend tax breaks to low-wage workers, particularly those with children. The credit was favored by the commission, according to the report, because it provides an incentive to work.
“It gives us something that we can begin discussing, and see if there’s any consensus to move forward. Obviously, this is a very political processs, and you are affecting virtually every sector of our economy. We’re going to hear from a lot of those folks, I¿anticipate. It’s something that is possibly a starting point. I’d like to look in some more detail at where they are coming from,” Palmer said.
The first part of the session is four days, with legislators resuming work Feb. 5, and Palmer said it might take a while for any legislation to be filed. He also expects to see modifications to the commission’s proposals but is glad legislators have a document to work with.
“Those are the type of things that are going to have to be discussed in greater detail, and ... it’s our responsibility as legislators to do that,” Palmer said.
There also has been growing public support recently for the legalization of hemp, and Palmer said he would be in favor of legislation that allows Kentucky to produce the crop.
“We raised hemp in this state for many years, and we have a great location for raising that crop, and you know, we’re importing a number of products that are made with hemp from other countries in our manufacturing sector today,” Palmer said.
State law enforcement officers have objected to the plan for fear that it would make it difficult to distinguish between legal hemp and illegal marijuana. Palmer said he is sensitive to police concerns but does not anticipate a problem.
“You’re going to have farmers growing it in fields like tobacco. That’s not how we grow marijuana in this state. I don’t know why there is that concern,” Palmer said. “Industrial hemp is going to be grown in farm fields in plain view.”
In the wake of the school shooting earlier this month in Newtown, Conn., Palmer also said he expects legislators to discuss ways to make schools safer for students.
“Obviously, we’re going to watch what happens at the federal level in order to be ready to respond to anything they might do. At the end of the day, all of the weapons that young man had in his possession were purchased legally, every one of them. That’s why I¿think that, for us, our first question needs to be, are we doing all that we can do to make sure our schools are safe? Obviously, it’s a complex question,” Palmer said.
Current practices require school buildings to be locked, and visitors must be admitted by school personnel.
“Once that lock is unlocked, and they have been identified on that camera, I have access to that main hallway in (the) school. My initial thought would be, could we limit access to the school before you have a face-to-face encounter with someone? Do we need to look at a controlled area where someone has to encounter someone before they have access to the entire school?” Palmer said.
As the parent of both an elementary and middle school student, Palmer said this issue is something he is particularly interested in, and is closely following the national debate over gun control, a federal issue.
“That certainly is a very difficult discussion. You want to respect people’s rights, I understand that. But there are things that we can do better,” Palmer said.
Other issues Palmer said will take priority during this session include the outsourcing of Medicaid to managed care organizations and redistricting. In November 2011, Kentucky contracted with private companies to manage the Medicaid system, but the switch has led to fewer reimbursements for physicians and local health departments, thanks to changes in coverage options. The Physicians’ Network, a group of private providers in Central Kentucky, decided to stop contracting with Coventry Cares, one of three managed care organizations covering Medicaid patients. Kentucky Spirit recently decided to terminate its contract with the state, effective June 30, 2013.
“I imagine 30 days will go by pretty quickly,”¿Palmer said.
For more information on the Blue Ribbon Commission on Tax Reform, visit ltgovernor.ky.gov/taxreform/.
