The 4th meeting of the Interim Joint Committee on Local Government was held on Thursday, October 5, 2006, at 1:30 PM, in the Bluegrass Ballroom of the Rupp Arena Convention Center in Lexington, Kentucky. Senator Damon Thayer, Chair, called the meeting to order, and the secretary called the roll.
Present were:
Members: Senator Damon Thayer, Co-Chair; Representative Steve Riggs, Co-Chair; Senators Walter Blevins, Jr., Julian M. Carroll, Ernie Harris, Alice Forgy Kerr, and Johnny Ray Turner; Representatives Adrian K. Arnold, Scott W. Brinkman, Ron Crimm, Mike Denham, Ted "Teddy" Edmonds, Derrick Graham, Jimmy Higdon, Charlie Hoffman, Dennis Keene, Stan Lee, Thomas M. McKee, Reginald K. Meeks, Brad Montell, Arnold Simpson, Ancel Smith, and Jim Wayne.
Guests: Representative Mike Cherry; Mayor David Willmoth, City of Elizabethtown, Mayor Tom Watson, City of Owensboro; Mayor David Cartmell, City of Maysville; Mayor Glen Caldwell, City of Williamstown; Sylvia Lovely, Neil Hackworth, Jerry Deaton, Bert May, Bill Thielen, Phil Huddleston, and Craig Maffet, Kentucky League of Cities; Vince Lang and Shellie Hampton, Kentucky County Judge/Executive Association; Richard Tanner, Kentucky Magistrates and Commissioners Association; and Ron Wolf, Louisville Metro Government.
LRC Staff: Donna Gaines, Mark Mitchell, Joe Pinczewski-Lee, Brian Wilkerson, and Cheryl Walters.
Senator Thayer announced that the committee was meeting in conjunction with the Kentucky League of Cities' annual convention. The first order of business was a presentation of the Kentucky League of Cities' (KLC) legislative platform for the upcoming 2007 session of the General Assembly. Senator Thayer recognized Ms. Sylvia Lovely, CEO and Executive Director of KLC.
Ms. Lovely welcomed the committee and thanked them for meeting during the League's convention. She then gave members a brief overview of KLC. Ms. Lovely noted that KLC had 370 member cities and 80 employees. She then introduced the first vice-president and incoming president of KLC, Mayor David Willmoth, City of Elizabethtown, for comments.
Mayor Willmoth told the committee that it was great to have them each year at the annual meeting to hear the League's concerns. He noted that cities are vital to the productivity of the state. Mayor Willmoth stated that cities need additional mechanisms for revenue generation, a constitutional amendment to give cities taxing options, and there needs to be modernization of the existing taxing structure. He commented that some cities will go bankrupt if new mechanisms are not found.
Mayor Willmoth pointed out that storm water drainage is also a big problem for some cities. He noted that some cities have or provide little or no storm water drainage services. Mayor Willmoth stated that another issue facing cities is the cost of funding pensions, especially hazardous duty pay. He said CERS has a serious impact to many communities. He noted that in the next ten years, pension costs will be 2 1/2 times what they are today.
Representative Riggs asked if the cities had considered transferring the responsibility of drainage to a special district. Mayor Willmoth said the urban areas have been able to do that. He added that the statutes do not mention storm water drainage and that may need to be amended.
Ms. Lovely next introduced Mr. Jerry Deaton, Director of Governmental Affairs for the League. Mr. Deaton first thanked the committee for all that they do to help cities. He told the committee that there needs to be changes to the Constitution in three basic areas: (1) the ability for cities to have a local option sales tax based on a referendum, which would include the legislature statutorily establishing the details; (2) allow the legislature to authorize a revenue sharing option between the state and local governments, which would also have the legislature establishing the details of any such programs; and (3) allow the legislature to grant cities broader taxing authority.
Representative Hoffman commented that he agreed that cities need more avenues to determine their future, but he said he is concerned about using a referendum which would cause local division and would be expensive to administer.
Representative Brinkman asked what kind of campaign the League envisions reaching out to the citizens of the state, not just the local officials. He added that citizens need to be educated. Mr. Deaton replied that they are concentrating on the legislature. Ms. Lovely added that the League has already started to educate the constituents of the local elected officials.
Representative Meeks commented that there is not one legislator who is going to turn a deaf ear.
Senator Carroll commented that state government is practically bankrupt. He added that the state has the same pension problems as the local governments.
The next item of business was discussion of eminent domain in Kentucky cities. Senator Thayer noted that HB 508, relating to eminent domain and sponsored by Representative Rob Wilkey, was passed during the 2006 session. He added that HB 508 provided for delineation of the allowable public uses for eminent domain in the Commonwealth. Senator Thayer then recognized Mr. Deaton again.
Mr. Deaton told the committee that a vast amount of questions were answered with the passage of HB 508. He added that changes were made to KRS Chapter 99 to address blight. Mr. Deaton noted that Chapter 99 is the least used chapter for economic development purposes.
Representative McKee commented that the issue of eminent domain is not only important to KLC but to the Commonwealth as a whole. He stated that HB 508 did answer a lot of questions.
Mr. Deaton commented that retirement costs are escalating, which is a big issue facing cities.
Representative Simpson asked if KLC had a proposal that they would like to offer. Mayor Tom Watson, City of Owensboro, stated that they do not have specific proposals at this time but that there are alternatives to consider.
Representative Simpson commented that in addition to pension costs is the rising cost of health care. He stated that he did not have an answer. Representative Simpson added that if KLC had something concrete, the committee would be willing to work with them.
Representative Graham commented that the cities are going to have to lobby their own departments on the issue of hazardous duty pay first.
There being no further business, the meeting was adjourned at 2:55 p.m.