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Archives: State News
Updated: Wednesday, May 26, 2004 1:34 PM EDT

Senator Jack Westwood (R - Crescent Springs), left, discusses a bill with Senator Dick Roeding (R - Lakeside Park) during a Senate recess in Frankfort.

Courtesy Senator Westwood

Time Running Short for Budget Talks

By Lori Cossens
ChallengerNKY.com

FRANKFORT More than a month after the General Assembly adjourned without a budget, legislators still have no concrete plans to go into special session to resolve the matter. And, while the clock ticks toward the end of the fiscal year on July 1, some local politicos say partisan politics and election efforts are taking lawmakers' minds off the business of passing a budget.

Several Republican state legislators will be on the ballot in Northern Kentucky in November. Jerry Kitch, a Democratic Party precinct captain in Elsmere, says he believes the election has become the major concern in Frankfort.

"(Legislators) are down there to vote," Kitch says, "but they've already started campaigning."

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Kathy Groob, Democratic candidate for the Kentucky state senate, 23rd district, agrees with Kitch.

"There's a partisan divide that they can't seem to put aside," Groob says. "During the campaign, that's fine, but right now their chief job is to pass the budget."

Education, Groob says, has been hardest hit by the budget crisis. Northern Kentucky University is awaiting $48 million allotted in the proposed budget for the university's planned special events center, and $14 million which would go to NKU's Gateway Technical Center in Edgewood.

Even as NKU prepares to hold its graduation ceremonies in Cincinnati because it does not have the facilities to accommodate the event, university President James Votruba remains optimistic. He says he has faith in Republican Gov. Ernie Fletcher, and in the ability of the Democrat-controlled House and Republican-majority Senate to compromise.

State senate hopeful Kathy Groob talks issues at the Kenton County Democrats Executive Committee dinner last month at Walt's Hitching Post in Covington.

Photo by LORI COSSENS

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Votruba is hopeful that a special session will be held before the governor has to resort to emergency measures. He also says that if the budget is passed as presently proposed, it would be a progressive package for NKU.

"It's the best budget we've seen," he says.

Seeking a Solution

Optimism remains among lawmakers, as well. State Sen. Jack Westwood (R Crescent Springs), who holds the seat Groob is seeking in November, says legislators are as concerned about the standstill as constituents. And Republicans are as frustrated as Democrats.

"We're running into a logjam," he says, "(but) it won't do a lot of good casting blame."

Westwood says he believes members of both parties are generally working hard to resolve the budget issue, and he has been in talks with Democrats and Republicans in the past few weeks. But he says partisanship has been a factor in some cases.

"There is a lack of trust between the two parties," Westwood says, but adds that the Senate tried hard to compromise.

"(The House) came up with a lot of demands," he says, "and whatever they demanded, we pretty much went along with."

Gov. Fletcher's Tax Modernization Package, however, continues to be the major sticking point between the two parties. The package was part of Gov. Fletcher's platform, and was touted as a way to "eliminate waste, fraud and abuse."

But Westwood says the package could not be negotiated as a bill, so the governor was forced to make it a part of the budget. The package is an extensive overhaul of the former system in Kentucky, lowering some taxes and raising others.

"The tax code in Kentucky is leaky and unreliable," Westwood says.

The governor's tax plan includes, in part, a reduction in the rate cap on corporations, from 8.25 percent, down to 6 percent, an increase for satellite dish manufacturers and owners (said to make the taxation equal to that of cable television services), and an increase in alcohol and tobacco taxes. Republicans say the tax increases are equal to the decreases, so there is no actual "tax hike." They also say the break for corporations is matched by stipulations that would eliminate loopholes that have allowed some corporations to avoid some taxes altogether.

But Groob, who is a marketing executive for Hemmer Companies, a corporate real estate and construction company in Fort Mitchell, says the package focuses too heavily on tax breaks for corporations. She says her experience indicates that other factors especially a technically adept workforce are more important to companies considering a location.

"What Kentucky needs to do is stop focusing on being the cheapest place to do business," she says, "and focus on being the best place to do business."

Two Parties, One Budget

Both parties continue to argue over the merits of the proposed budget, but Westwood says some of this is part of the natural process.

"We're in a two-party state now," he says. "There will be tension a contest of wills, politics and policies."

But Westwood says he is anxious to resolve the issue. Constituents want a solution, and legislators have until July 1 to provide one. Otherwise, Governor Fletcher will likely enact his executive spending privilege, which guarantees funding for only the most basic government functions.

"I'm optimistic," Westwood says, "that the legislature will ultimately do what needs to be done to pass a budget."

Posted 5/26/04

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