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Kentucky

Quasi Quandary

Quasi Quandary

You have probably heard of the imminent extraordinary or “special” session of the Kentucky General Assembly. Included in the Governor’s veto message on HB358 from the 2019 Regular Session was a promise to issue a call for an extraordinary session to address the pension problem for quasi-governmental agencies before July 1. So what is this pension problem anyway?

Quasi-governmental agencies are pretty much exactly what their name suggests: agencies that are not explicitly government departments, but are exclusively (or very nearly exclusively) funded by government (read: taxpayer) funds, and they each perform essential functions for the populations they serve.* These agencies are designated as non-profit organizations. The Christian County Health Department, Pennyrile Children’s Advocacy Center, Sanctuary, and the Pennyroyal Mental Health Center are some of the primary quasi’s in this area, though the last three in that list have a service regions that extend well beyond our own county line.

No other agencies or arms of state government exist to perform any of these services.

A few decades ago, someone thought it would be good to include these agencies in the Kentucky Retirement Systems. I don’t think that’s a bad idea necessarily, and at the time it looked like a very good one. The employer contribution rate for each participating employee was very low. However, with time, that employer rate has climbed up. Today these agencies are paying somewhere in the neighborhood of 49% of payroll. That means, for every dollar of payroll, the agency is having to find another 49¢ to send to KRS. First, for these non-profit agencies, finding that additional 49¢ is very challenging, as it starves out funding for other important needs like adequately compensating staff, procuring important supplies, expanding their critical services (which all our communities need), or even maintaining their locations. Second, the 49¢ is actually way lower than it should be to keep KRS funded adequately. In truth the employer contribution rate should have been steadily climbing for many years.

So, here we are, facing a July 1st deadline when the rate jumps to at least 83% overnight. For other participating employers not deemed quasi-governmental we’ve already passed a solution that phases in that rate increase over time. Cities and counties now have a new imperative to find all the revenue they can to make ends meet. HB358 as passed this year would have forestalled that big rate jump for quasi-governmental agencies for a year while these agencies decide whether and how to proceed, by staying in the system or getting out, both of which would have resulted in increased costs. The veto struck that bill in its entirety, so without a special session to pass something else that offers immediate relief, the rate jumps up come July. With that enormous rate increase comes the almost certain reduction in staff and services for most, if not all, quasi agencies.

We risk the loss of staff and services from a group of agencies that provide services the state is neither prepared nor equipped to provide. The Pennyrile Children’s Advocacy Center performs forensic interviews and provides vital care and services for children victimized by sexual assault. Just a couple short months ago the Christian County Health Department helped administer hundreds of vaccinations for Hep-A after a handful of cases hit the county jail. Sanctuary provides emergency housing and security, among other services, for women and their children in need of escaping physical abuse. No other agencies or arms of state government exist to perform any of these services. PCAC, Sanctuary and the Pennyroyal Center serve multiple counties. If their employer contribution rate goes up in July those service footprints in other areas are at risk of evaporating.

On the other hand, the Kentucky Retirement System needs to be made whole. Even giving cities and counties phase-in relief last year hurt the CERS bottom line. Every day a participating employer or employee (or legislature) doesn’t pay all they’re supposed to, the system and its retirees get shortchanged. We can’t afford KRS going under. We can’t afford these agencies going under. A balance must be found.

We can’t afford KRS going under. We can’t afford these agencies going under. A balance must be found.

The Governor has done what legislative leadership asked following his veto: come to us with proposal. I attended a briefing conducted by his senior staff last week and I raised a number of questions. The bill includes a one year rate freeze for quasi agencies, and grants them that time to decide which path they want to take: stay in and pay full freight, or get out of the system through one of three different doors. I believe the agencies that cannot afford to pay the full price of staying in should get out of the system, but I firmly believe they should be given a way out that is affordable. The proposal provides only one way out that is truly affordable to most of these agencies, called the “hard freeze,” and requires all Tier 1 and 2 (the senior most) employees to be pulled out of the system along with the agency. Those workers will of course keep everything they’ve accrued, but cannot earn any additional time toward their retirement mark in KRS as long as they remain with that employer. I disagree with pulling those folks out of the system. The options that allow those employees to remain are cost prohibitive for all but the most wealthy quasi agencies, and I’m not aware of any agency in the three counties I represent that can afford them.

There are other concerns, unique to certain quasi agencies, including the change to how their payments to KRS are classified. State and Federal grant funds that flow to places like Sanctuary restrict the use of those dollars for costs directly related to personnel, and attached “fringe benefits.” The proposal would require payments from the agencies toward the unfunded liability, not explicitly connected to payroll, making today’s grant dollars used for payroll unavailable for tomorrow’s debt service.

Similarly, there are three community mental health centers, including the Pennyroyal Center, who act purely as hiring agents for the state when staffing certain facilities. Those employees are governed entirely by the state, but they are currently counted against the CMCHs’ unfunded liability. This is not right. Unfortunately, the proposal before us addresses neither of these issues, and I have been given no affirmative assurance that there will be a material, meaningful effort to fix those problems in the 2020 Regular Session.

I’ve asked the Governor and his team to make modest adjustments to the proposal to make the cessation options slightly more affordable, and to address these two issues that directly impact the local agencies for whom I speak in Frankfort. Unfortunately, I have received no feedback that suggests changes to the proposal would be welcome. I will continue to advocate for those changes, ahead of any potential special session, and during the 2020 session if need be. Needless to say, this issue is among the most complicated the legislature has had to deal with. Getting the answer just right is that much more important.

* The group of quasi-governmental agencies also include all public universities in the Commonwealth other than UK and UofL, both of whom have their own pension systems. However, this post is about all the quasi’s other than the universities. These institutions are also vital to the Commonwealth, but they are on a much different fiscal footing than all the others. They are able to raise tuition and fees, they each have private foundations, and generally have more assets than the rest of the quasi group. To my knowledge, the public university group has been satisfied with each version of HB358 that was passed during the regular session and they are in support of the Governor’s proposal.

Follow the Money

Follow the Money

Less than 3 weeks away from the May Primary Election and the truth about one of the Democratic candidates for Governor finally finds its way to light.

Andy Beshear owes his political success, in part, to blood money from Purdue Pharma. We know his former firm was defending Purdue — the maker of the deadly oxycontin — against Kentucky. We know the outgoing AG’s office settled the “billion-dollar case” for peanuts because Purdue’s former lawyer just won election as Kentucky’s newest Attorney General and would be in charge of the lawsuit on the other side; a tremendous conflict of interest. We know Andy Beshear has repeatedly bragged, until Oklahoma’s recent $270 million settlement with the drug manufacturer, about how Kentucky’s was the largest settlement (at a paltry $24 million) in the country. We also know that Andy has repeatedly denied any connection with Purdue in his law practice.

The same cannot be said for his campaign to be AG. Three weeks out from Election Day, when the race was effectively tied, Andy’s good friends at Purdue Pharma dropped $100,000 to the Democratic Attorneys General Association (DAGA):

DAGA’s Form 8872, Year-End Report (2015), available  here .

DAGA’s Form 8872, Year-End Report (2015), available here.

The very next day, DAGA sent a cool $250,000 to the Bluegrass Democratic Attorneys General Association, a PAC established to help Andy:

KREF  Report

KREF Report

And on that same day, the Bluegrass DAGA sent the $250,000 to a SuperPAC formed to help Andy called the Bluegrass Alliance for Consumer Rights:

KREF  Report

KREF Report

Andy Beshear should be ashamed. Maybe a call gets made near the end of the close campaign and a client arranges for some last minute help. Andy benefited from a timely donation of $100,000, earned from the addiction to a drug that was shamelessly and ruthlessly marketed and sold across the country, irreparably harming so many families in Kentucky alone.

This man does not deserve to be a public servant, much less the Governor of the Commonwealth.

Marsy's Law Ruling

Marsy's Law Ruling

Yesterday, October 15, the Franklin Circuit Court issued its ruling in the legal challenge by the Kentucky Association of Criminal Defense Lawyers to SB3 (2018), known widely as Marsy’s Law. The Court determined that the ballot question for this constitutional amendment addressing victims’ rights is unconstitutional. I profoundly disagree with this determination, and will seek transfer of the inevitable appeal directly to the Kentucky Supreme Court. As the sponsor of SB 3, I have worked tirelessly to elevate the voice of crime victims within the criminal justice system as a constitutional right, and I am steadfastly committed to this cause regardless of today’s ruling. I remain confident that SB 3 will be incorporated into the Kentucky Constitution by the voters of the Commonwealth.

These are the key takeaways to keep in mind:

  1. The ruling is being appealed; the notice of appeal was filed today.

  2. Marsy’s Law WILL STILL be on the ballot in November and we still NEED YOUR VOTE!

  3. The Judge’s ruling expressly allows for the Secretary of State to still count the ballots in support of Marsy’s Law. This was done to allow for the orderly appeal process in which we are now engaged.

  4. Our fight to ensure crime victims the rights and respect they deserve continues stronger than ever!

  5. For more information about Marsy’s Law, FAQ, endorsements and news releases, please visit https://www.victimsrightsky.com/

  6. A misleading narrative keeps popping up that Marsy’s Law will weaken the presumption of innocence. This is FALSE. In fact, the proposed amendment specifically includes language that clearly states “Nothing in this section shall afford the victim party status, or be construed as altering the presumption of innocence in the criminal justice system.” (SB3, p.2, Lines 7-8)

You can find PDF’s of my statement, the Franklin Circuit Court’s ruling and the full text of Marsy’s Law below. Stay up to date on the case by bookmarking this site, or by following on Twitter and Facebook (linked below). I’ll keep updates posted as I have them.

SB200 Rebuttal

SB200 Rebuttal

I am writing in response to the story “WDRB Investigation: New KY law contributes to rise in Louisville juvenile crime,” done by Mr. Gil Corsey. I was the sponsor of Senate Bill 200, a major 2014 juvenile justice reform law aimed at holding youth accountable, while getting youth and their families the services and programming they need to get back on track. I serve as chair of the Juvenile Justice Oversight Council monitoring its implementation. Since passage, we’ve meticulously reviewed data from across the juvenile justice system, which show better outcomes for youth and families statewide.

I took issue with a number of the points Mr. Corsey made in this story. In Jefferson County, 42% of youth who were put on diversion in CY 2016 had committed a status offense. Status offenses are behaviors that many kids need to be steered away from at one point in their youth, like truancy or tobacco possession, but they are not considered crimes for adults. The increase in diversion cases in Jefferson County is driven primarily by these status offense cases, not crimes. 

This is exactly what we want to see. Research is clear that for low-level youth, such as those committing status offenses, pulling them deeper into the system can actually produce the opposite of the desired outcome. The youth’s behavior often gets worse, not better. Instead of fixing the problem, the government ends up pulling the youth away from their family and isolating them more.

I also want to point out a problem with how Mr. Corsey categorized “serious violent offenses” in his recidivism definition. In that definition he included four different types of assault in the 4th degree, a misdemeanor crime that results in either no visible injury or only minor injury. These crimes are not included in the FBI’s Uniform Crime Reporting category of violent offenses, and as a former prosecutor I personally do not believe they should be considered “serious, violent offenses” in the same category as crimes like robbery, rape and murder.

This recidivism definition is important to clarify because more than one-third of diverted youth who Mr. Corsey categorized as serious, violent re-offenders were charged with some form of assault in the 4th degree as their subsequent offense. If you exclude those youth from his recidivism definition, less than 4% of youth who were diverted in CY 2016 have subsequently committed a serious, violent offense. This is an extremely low recidivism rate.

I believe these data are important to clarify because examining data related to Senate Bill 200 implementation is a core component of the Juvenile Justice Oversight Council’s responsibility. We have defined performance measures to routinely track the implementation of the legislation, and we regularly receive data reports from the Administrative Office of the Courts, the Department of Juvenile Justice, and other relevant agencies charged with policy implementation. 

In examining statewide data, we have seen many positive results from Senate Bill 200 implementation. Statewide, public offense complaints (offenses that would be considered crimes if committed by an adult) have continued to decline in the years following the reforms. While we have seen an increase in diversions, we have also seen that more than 90% of youth successfully complete diversion and are kept out of the court system, and the vast majority of youth who successfully complete diversion do not reoffend. When youth are successful in diversion, it frees up time for the juvenile court to handle more serious cases and for judges to use their resources on the cases that truly pose a risk to public safety.

Finally, I want to make a critical point about Senate Bill 200: this legislation did not change any statute related to how the most serious crimes can be handled in juvenile court, or impact any juveniles who commit such serious offenses that they end up being sent to criminal court. Senate Bill 200 was designed to curb unnecessary, ineffective and costly detention for the lowest level offenders, and provide more effective community-based programs to address problem behavior. This allows the state to prioritize  scarce resources in court and in the Department of Juvenile Justice to better address the needs of youth who commit serious offenses and have significant prior history. This can improve public safety and improve outcomes for youth, which should be the ultimate purpose of Kentucky’s juvenile justice system.

Until the War is Over

Back in May (2014), I made a trip to Frankfort to catch up with a school group that was taking a daylong field trip around the historic sites of the Capitol City.  The Heritage Christian Academy Warriors (4th graders) have made a trip up to the Capitol both years I've been in office, and like any other school group visiting during the interim (when I'm not already up there for session) if I can I make the trek to Frankfort too meet them.  I hate missing a chance to visit with school kids about the job I'm blessed to have — one of these kids from the district is going to have this job one day in the future!

I caught up with the group and took them to the Senate chamber and had a chance to talk to them for nearly 45 minutes.  They asked all kinds of questions and I gave all kinds of answers!  Since we had the room to ourselves and plenty of time, I explained a lot about the kind of things we do, good and bad.  One of the students asked if I had ever been scared doing my job.  Interesting question.  Easy answer.  Yes.

I've been nervous before, about speaking or carrying a bill on the floor, but those are just nerves about sounding stupid or saying something inaccurate or embarrassing.  Fear, on the hand, hasn't been felt nearly as often.  In fact, I can only think of one occasion.  Carrying Senate Bill 8, the "ultrasound bill," in the House Health & Welfare Committee.  The bill, just like others over the years before now, had come out of the Senate and died at the hands of a pro-choice Committee Chairman and pro-choice House leaders — some publicly and unabashedly, and others under cover of anonymity and secret, if not outright deceit.  This year, the bill had sat without a hearing in the House Health & Welfare Committee for over two months when a discharge petition was filed in the house.  A discharge petition, if passed by a simple majority (51 of 100), would remove the unheard bill from the Committee and bring it before the full House for a vote on the floor.  This year, despite 61 co-sponsors of a house bill that contained SB8 language, 49 democrats and a couple of republicans (many of whom brag on themselves for co-sponsoring the same kind of bill) either walked out on the discharge petition vote or simply failed to show up for it at all.  The petition failed to pass.  Naturally, the next move of House leadership was to hear the bill in Committee - it's an election year so they can't ignore the bill altogether.  That's where I come in.

The House Health & Welfare Committee is perceived, fairly or unfairly, as unfriendly territory for conservatives.  Liberals control the membership head count, and the tension between committee members of opposite ideologies is palpable and sometimes expressly shown.  Even the committee members themselves refer to the committee by its common nickname "Hell & Warfare."  This was the lions' den, and I was ordered to march in knowing legislative defeat was certain.

I approached my testimony with great fright, believing I would be attacked or my words twisted by the committee members or the media or both.  But I carried on. I presented the bill calmly and directly, explaining the bill didn't actually do anything to expressly restrict abortion at all (no matter how much I wish would).

My testimony fell on more deaf ears than not. Those who wish to protect abortion rights made half-true claims about the bill, and particularly galling was the act by two of the most fiercely prochoice members of the committee to make the initial motion and second for the bill to be voted on — they knew they had numbers.

I explained the situation as it unfolded (edited for time and content, of course)  to these school kids. I told them how scared I was of that meeting and the battle that would come my way.  It was at that moment when a young man raised his hand to ask this profound question:

So you fight until the war is over?

Yep.

A reporter politely asked me once why we (conservatives) keep fighting for prolife legislation when we know it will continue to be defeated.  We keep fighting because those lives should be protected, and we can't give up until they are.  I trust God's plan, regardless of the outcome.  He can *seal* the mouths of the lions!