NKY Chamber ‘Where We Stand 2019’ at Devou Golf and Event Center outlines legislative agenda

NKyTribune staff

The Northern Kentucky Chamber of Commerce presented its “Where We Stand 2019” legislative agenda Tuesday at the Devou Golf and Event Center in Covington.

The Chamber leadership outlined the priorities for the 2019 legislative session and reflected on what was accomplished in 2018.

Chamber President and CEO Brent Cooper said he knew the 2018 legislative session would be challenging. Faced with pension liabilities, stagnant revenues, a budget and two-year road plan to pass, as well as leadership transitions and pending elections, it was clear the General assembly had its work cut out.

“Despite all of these challenges, by the end of the session, Northern Kentucky emerged from Frankfort with key legislative wins,” Cooper said. Chairman (Adam) Koenig (R-erlanger) led efforts to pass much-needed workers’ compensation reform, which reduced businesses rates’ by 10 percent. Write it down and share it with others in your network – these are real numbers for your bottom line.”

Cooper also talked the final implementation of post-secondary, performance-based funding that will benefit Northern Kentucky University and about tax reform, which included several Chamber priorities.

“Finally, with the road plan, over $197 million was secured in Boone, Kenton and Campbell counties to address the ever-expanding growth across our region,” Cooper said. “The legislation championed and supported by the Northern Kentucky Caucus has made a significant impact on our region’s economy.”

The Northern Kentucky Chamber of Commerce 2019 Legislative Priority Agenda

*Transportation & Infrastructure

Policy Position
The Northern Kentucky Chamber of Commerce supports long-term, sustainable funding that provides adequate revenues for all impactful modes of transportation so our region can maintain our current infrastructure, build for our future and address our workforce issues related to transportation.
The NKY Chamber supports modernizing Kentucky’s road fund formula by providing a more equitable distribution of the state gas tax revenues for construction and maintenance in urban areas of the Commonwealth.
The NKY Chamber encourages the General Assembly to provide reliable funding solutions to address unfunded mandates related to our aging infrastructure repair/replacement and the associated construction of water, wastewater, and storm water infrastructure to reduce funding gaps and grow the local economy while protecting the environment.
The I-71/75 Brent Spence Bridge and corridor, now functionally obsolete, is a critical economic resource and gateway for linking Kentucky’s businesses with the global economy. This multi-state corridor is a vital conduit for the nation’s commerce and remains a priority project for the Northern Kentucky region. We encourage Governor Bevin and the General Assembly to find a reasonable funding solution for this regionally significant economic development project.

Background
Northern Kentucky’s transportation network of roads, bridges, public transit, airports, river ports and railroads connect the Commonwealth’s businesses to the national and international marketplace by providing multiple safe, cost-effective ways to move goods and deliver services.
Northern Kentucky has landed many high volume economic development projects in recent years and will require a large amount of infrastructure projects to handle the vast amounts of rapid economic growth. Adequate and equitable infrastructure investments must be made in Northern Kentucky to successfully accommodate the rapid economic growth of our region.
The burden of the $2 billion consent decree placed on the Sanitation District No. 1 of Northern Kentucky by the Environmental Protection Agency continues to challenge our region to invest. It is increasingly difficult to grow the infrastructure needed for future development, while balancing the required investment to update our sewer overflow systems.

*Expand Tax Modernization

Policy Position
The Northern Kentucky Chamber of Commerce urges the General Assembly to build on their efforts in the 2018 Session to modernize the Commonwealth’s tax code and address the long-term need for comprehensive tax reform. We urge consideration of tax changes that specifically put Kentucky on equal footing with competitor states, especially border states.
The NKY Chamber supports broadening the base without disproportionately burdening specific industries or negatively impacting nonprofits, including these specifically:
• Provide relief for nonprofits collecting and remitting sales taxes for events and programming related to fundraising.
• Treat banks like all other corporations for the purpose of taxation by replacing the bank franchise tax with the corporate income tax.
• Monitor the effectiveness of the new inventory tax credit and study strategies for eliminating the inventory tax without draining
local coffers.
• Repeal the new mandate for combined reporting and allow corporations doing business in Kentucky to elect between filing
separate returns, a combined return based on the unitary business methodology, or a consolidated return using the corporation’s
federal consolidated group.
• Bringing Kentucky’s definition of Cost of Goods Sold (COGS) into conformity with the federal Internal Revenue Code definition to
enhance compliance by businesses and improve enforcement by the state.

Background
Business leaders in Northern Kentucky continuously express the tax system is too complex and compliance is too costly. Economic development experts say our code continues to create a competitive disadvantage because it punishes economic productivity.
The Kentucky General Assembly took steps to modernize the Commonwealth’s tax code to lower the rates and broaden the base for some services in the 2018 Legislative Session. These changes improved the state’s Business Tax Climate from 33rd in the nation to 23rd, according to the Tax Foundation. The NKY Chamber supported these modernizations and encourages the Kentucky legislature to continue their efforts to address comprehensive tax reform.

Guiding Principles
• Support growth and competitiveness: Kentucky’s state and local tax system should support growth-oriented tax policies that improve the competitiveness of Kentucky businesses in the national and international marketplace.
• Simplify the tax code: The tax code should be simplified with the goal of reducing compliance costs for the private sector. Complex taxes impose costs on businesses that either reduce the return on investment or they are passed on to consumers and workers.

*Pension Reform

Policy Position
The Northern Kentucky Chamber of Commerce supports pension reform that will lead to a healthier business climate and an improved credit rating for our state, while keeping the promise made to public servants.
Recent action taken by the Kentucky General Assembly to address pension reforms will pay down the Commonwealth’s pension liabilities faster than taking no additional action. However, the legislation passed is being litigated before the Kentucky Supreme Court. The Northern Kentucky Chamber of Commerce will follow this litigation and will advocate for pension reform if necessary.
The NKY Chamber supports legislation to provide meaningful pension reform to affected postsecondary institutions, like Northern Kentucky University. The reform should reflect successful efforts seen in other states for affected postsecondary institutions.

Background
The NKY Chamber has advocated for pension reform for Kentucky’s pension systems for many years. The General Assembly has taken action in the past decade to reform the retirement systems and increased funding levels, all of which the NKY Chamber supports.
Their actions have placed the Kentucky Retirement System on a path toward financial solvency.

Guiding Principles
While progress has been made, the NKY Chamber believes any continued pension reform should focus on ensuring the viability of Kentucky’s public pension systems into the future and will:
• Protect the cash flow of current and future retirees, which creates a positive economic impact into Northern Kentucky’s 
economy on a daily basis
• Respect the commitment made to outgoing retirees who are already vested in the public pension system
• Decrease the severity of future funding cuts to other parts of the state budget including investments into transportation 
infrastructure, P-12 & postsecondary education, and healthcare programs, capital projects, and others
• Not shift the financial burden to local governments therefore increasing taxes on local businesses and employers
• Halt the out-of-control increases in the state’s pension debt and create a plan to pay off that debt
• Show national credit rating agencies that Kentucky is serious about pension reform, improving the state’s prospects for 
upgraded ratings and lower public borrowing costs

*Support Expanded Gaming and the Introduction of Sports Wagering

Policy Position
The Northern Kentucky Chamber of Commerce supports legislation to allow for expanded gaming and sports wagering in the Commonwealth.
Background
Expanding gaming and sports wagering will create new jobs and grow our economy. The tax dollars derived from these activities can improve our education system, build infrastructure that promotes economic growth, and ensure the long-term stability of the state budget.
The NKY Chamber encourages the Kentucky General Assembly to act swiftly, in light of the recent U.S. Supreme Court decision to permit sports wagering in all states. A delay by the legislature reduces our competitive advantage with surrounding states.

*Unemployment Insurance Reform

Policy Position
The Northern Kentucky Chamber of Commerce supports modernization reforms to Kentucky’s unemployment insurance benefit structure with the goal to aid workers returning to employment.
The NKY Chamber supports the provision of unemployment insurance benefits for dislocated workers who are participating in and compliant with retraining efforts.

Background
The NKY Chamber recognizes the purpose of the unemployment insurance (UI) fund is to provide temporary support to displaced workers’ who are unemployed through no fault of their own and are actively searching for work.
As of August 2018, Northern Kentucky MSA’s labor force participation rate was 66.4%, which is higher than the statewide rate at 59.3%. In order for employers in our region to fill the open positions across our region, the NKY Chamber must encourage public policy which drives more citizens into the workplace and off Kentucky’s unemployment benefits.
Kentucky’s maximum weekly benefit is $448, which is higher than any of the southeastern states. Of our surrounding states, only Ohio and Illinois pay more. During the third quarter of 2017, Kentucky ranked 49th in the nation for length of benefits.

*Strengthening Our Workforce

Policy Position
Workforce continues to be one of the key challenges for employers around the country, and with the exceptional economic growth the NKY region continues to experience, the Northern Kentucky Chamber of Commerce is excited to lead the region, in conjunction with many outstanding partners in the workforce arena, to move the needle on all aspects of our talent pipeline.
Growing Regional Outcomes through Workforce (GROW NKY) is establishing critical short-term and long-term goals to address both supply and demand needs that will strengthen our high demand sectors and provide opportunities for students and adults alike. Aligning workforce activities in our region will show prospective and expanding companies that we have the best business climate in the nation. It’s an attainable vision, and one that this region is ready to tackle through proven collaboration and consensus-building.

Background
NKY Chamber created a new strategic initiative committed to strengthening the region’s workforce. The initiative, GROW NKY, is a comprehensive, holistic workforce development/talent strategy focused on leveraging the community’s full complement of assets to grow, attract, and retain a globally competitive workforce.
The initiative will focus on ensuring Northern Kentucky can attract future businesses and retain current businesses as a result of a strategic workforce effort, unique to the Commonwealth of Kentucky.
Low unemployment numbers in Northern Kentucky’s MSA, just 3.2% compared to 4.1% statewide (as of August 2018), contribute to the need to give due attention to finding qualified workers and ensuring that the educational system, in conjunction with local employers, can provide long-term career awareness and experiential learning opportunities to students. Closing the gap between the number of jobs available and a qualified workforce will be imperative to meeting both the supply and demand needs of the region’s talent pipeline.
GROW NKY will focus on five key pillars – Kindergarten Readiness, College & Career Readiness, Adult Career Readiness & Life Long Learning, Talent Retention & Attraction, and Employer Policies & Practices – each including respective short and long-term goals. Work in each pillar will be geared toward the high-demand sectors in Northern Kentucky: Advanced Manufacturing, IT, Advanced Logistics, Health Sciences, Financial Services and Construction.

*Attracting and Retaining a Diverse and Competitive Workforce

Policy Position
The Northern Kentucky Chamber of Commerce promotes legislation that encourages diversity and inclusion in the Northern Kentucky business community which creates a diverse talent pool and talent pipeline as a competitive advantage for our regional economy. Additionally, the NKY Chamber strongly opposes any discriminatory legislation or regulation. The NKY Chamber supports policies that attracts people, organizations and visitors to live and work in the Commonwealth.

Background
Kentucky will thrive most when it positively attracts and retains the best national and international human capital and talent. To further this objective, public policies and incentives in Kentucky should welcome and encourage top talent to settle in the Commonwealth. NKY Chamber promotes and embraces diversity, inclusion and equity.

*Early Childhood Investments

Policy Position
The Northern Kentucky Chamber of Commerce supports establishing universal access to pre-school for all children and establishing more public/private partnerships for early childhood education. The NKY Chamber also encourages the Kentucky General Assembly to make greater investments in quality early childhood education, including increased reimbursement rates for child care providers and Child Care Assistance Program (CCAP) eligibility for low-income working families.

Background
The NKY Chamber recognizes growing talent is the key to a vibrant economy. Our aggressive workforce outcomes will not be
met without the strong focus and support of the multi-generational approach of early childhood education, preparing children for Kindergarten and future success in school and reducing barriers to work for parents, which would increase our labor participation rate.

*KEES Scholarship Funding For Trade Schools

Policy Position
The Northern Kentucky Chamber of Commerce supports legislation allowing Kentucky Educational Excellence Scholarship (KEES) funds to be used for registered apprenticeship programs or qualified workforce training programs, targeted for Kentucky’s five high-demand work sectors.

Background
The NKY Chamber recognizes our region has a large skill gap in the area of skilled trades. In order to encourage more students to receive training in these high-demand work sectors, the use of KEES scholarship should be expanded beyond the traditional post- secondary institutions.

*Expand KEES Scholarship Funding For Early College

Policy Position
The Northern Kentucky Chamber of Commerce supports legislation allowing for the expansion of Kentucky Education Excellence Scholarship (KEES) funds to be used for Early College or high school students which are fully enrolled at a post-secondary institution. Based on current and potential future high school graduation requirements, students would only be receiving KEES scholarship funding to meet high school graduation requirements.

Background
The NKY Chamber recognizes that our school districts want students to have access to accelerated programs beyond the minimum high school requirements. Without expanded KEES scholarship funding, students from difficult socioeconomic backgrounds will have limited access to accelerated programs.

*Repealing Protected Class for Smokers

Policy Position
The Northern Kentucky Chamber of Commerce supports legislation to repeal smokers as a protected class of citizens in Kentucky.

Background
A study by Ohio State University shows it costs employers approximately $6,000 more a year to employ a smoker versus a non-smoker. In 1994, Kentucky enacted a law that made smokers a protected class. This law forbids employers from turning away a job applicant just because he/she smokes. As a border state competing for the top talent in our region, Northern Kentucky is at a disadvantage based on Ohio’s laws which do not elevate smokers to a protected class. The NKY Chamber believe this is an arbitrary and unjustified intrusion into the rights of employers.
Kentucky also has the second highest adult smoking rates in the country and has the highest death rate in the nation from cancer. Smoking related health care costs in the Commonwealth total $1.92 billion each year.

*Reduce Health Care Costs to Consumers

Policy Position
The Northern Kentucky Chamber of Commerce supports legislation that will address medical malpractice reforms which will effectively reduce health care costs to consumers and enhance the region’s ability to attract and retain a sufficient number of licensed medical professionals.

Background
Escalating health care costs and health insurance premiums for individuals and businesses and medical malpractice insurance for health care providers, which has an impact on health care costs, must be addressed by the Kentucky legislature.
Many states, including those surrounding Kentucky, require compliance with an alternative dispute resolution, medical review panel or physician certification process before medical malpractice lawsuits can be resolved through the courts.
More than half of the states have laws limiting the damages recoverable in medical malpractice lawsuits. The amount of the limits and the circumstances under which they apply vary from state to state. These limits apply to the amount that can be recovered by a plain- tiff in a medical malpractice lawsuit and may impact the overall cost of healthcare administration within the state. Smoking related health care costs in the Commonwealth total $1.92 billion each year.

*Addressing the Opioid Addiction Crisis

Policy Position
While much has been accomplished in the past few years with support from important legislation, the issue of opioid addiction continues to face Northern Kentucky and more work needs to be done. The Northern Kentucky Chamber of Commerce supports legislation that will help fund evidence-based initiatives for treatment, enhance law enforcement to reduce supply, assist with workforce reinstatement options and support for employers, and prevent disease. We support approaches that promote public safety and expand investments in education, training, and prevention. We support treatment in or as an alternative to incarceration for substance abuse and non-violent crime resulting from mental health issues.

Background
The Northern Kentucky Chamber of Commerce is concerned about the rising opioid epidemic and negative effect on Kentucky’s workforce and health care costs. The Northern Kentucky region has been significantly affected in recent years with overdoses increasing by over 49% between 2016 and 2017, residents dying from drug use five times more than by car accidents, and the Hepatitis C rates exceeding the national rate by 11.9%. The ability to recruit and retain workers is being challenged. In addition, those associated with family members who are addicted further affects productivity in the workplace.
In response to the crisis, community partners including businesses, law enforcement, health care professionals, public officials, and service providers have developed a plan for addressing the epidemic.
The Northern Kentucky’s Collective Response to the Heroin Epidemic plan is designed to reduce the supply of heroin through partnerships with regional, state and local law enforcement; advocate for needed legislation; reduce the demand for heroin through prevention, treatment and recovery support; and protect those who use heroin (as well as the general public) from harm due to intravenous drug use.
The plan is centered around four major strategies:

• Treatment – Develop and implement evidence-based treatment of opioid addiction
• Prevention – Build systems of community and school-based support and wrap-around services regarding adversity in childhood as a precursor to mental illness and substance use
• Recovery Support – Improve the process for treatment from beginning through long-term recovery and include supportive services
such as housing and workforce initiatives
• Protection – Develop an accessible distribution network for Naloxone to save lives and reduce the risk for infection because of intravenous drug use

*Address Adequate Funding For K-12 Education

Policy Position
The Northern Kentucky Chamber of Commerce supports legislation to commit growth in state revenue to increasing the Support Education Excellence in Kentucky (SEEK) base, restore SEEK and all other Flexible Focus Funds to levels that provide constitutionally adequate funding to support academic improvement for all Kentucky students.

Background
The NKY Chamber recognizes that continued cuts in K-12 education will have an adverse effect on the services and programs offered to students in our region. During the 2018 General Assembly, the legislature eliminated funds for Instructional Resources and Professional Development while reducing funding to Extended School Services for students.
Based upon a report from the Council for Better Education, the state is shifting the funding responsibility from the state to the local level. The total percentage of per pupil spending at the local level has risen from 40% in 2008 to 49% in 2018, thus creating an inequity throughout the state.
As a result, the gap is growing between what we spend in state and local dollars, per-pupil, in the state’s wealthiest and poorest school districts. An equal education for every child across the Commonwealth was one of the central mandates of the Rose Decision in 1989, the court case that led to the Kentucky Education Reform Act (KERA). Based on an inflation-adjusted analysis by the Kentucky Center for Economic Policy, the funding gap between the wealthiest and poorest districts in the state of Kentucky is quickly approaching pre- KERA funding status. The gap in 1990 was $1,558 per student and in 2018, that gap is $1,403.

*Kentucky Angel Investment Support Programs

Policy Position
The Northern Kentucky Chamber of Commerce supports the continuation of the Kentucky Angel Investment Act (KAIA) and the Kentucky Investment Fund Act (KIFA). These programs promote entrepreneurship by encouraging in-state and out-of-state individual investors to make investments in Kentucky small businesses, create additional jobs and promote the development of new products and technologies.

Background
Due to agency-wide budget cuts and priority funded for the pension systems, the Kentucky General Assembly elected to suspend fund- ing for the angel investment programs in FY18-20.
The NKY Chamber strongly supported the passage of the KAIA in 2014 to complement KIFA. Both programs, KAIA and KIFA, are proven, effective tools that are essential to continue the momentum for the creation and development of small companies in Kentucky’s innovation sector.

State Sen. Chris McDaniel, R-Taylor Mill and State Rep.-elect Ed Massey, R-Hebron, participated in discussion and a question-and-answer session about the upcoming legislative session. Rep. Diane St. Onge, R-Fort Wright, was scheduled to participate, but was tied up at the General Assembly Special Session.

The Northern Kentucky Chamber of Commerce is the leading business organization in Northern Kentucky. It is a Five-Star Accredited Chamber with nearly 1,500 member companies representing approximately 175,000 employees.

Additional information on the Chamber is available here.

Contact the Northern Kentucky Tribune at news@nkytrib.com