Interim Joint Committee on Appropriations and Revenue


Budget Review Subcommittee on General Government,
Finance, and Public Protection


Minutes of the<MeetNo1> 3rd Meeting

of the 2013 Interim


<MeetMDY1> November 25, 2013


Call to Order and Roll Call

The<MeetNo2> third meeting of the Budget Review Subcommittee on General Government, Finance, and Public Protection of the Interim Joint Committee on Appropriations and Revenue was held on<Day> Monday,<MeetMDY2> November 25, 2013, at<MeetTime> 10:00 AM, in<Room> Room 129 of the Capitol Annex. Senator Christian McDaniel, Chair, called the meeting to order, and the secretary called the roll.


Present were:


Members:<Members> Senator Christian McDaniel, Co-Chair; Representatives Dwight D. Butler, Mike Denham, Adam Koenig, Tom McKee, Steve Riggs, Tom Riner, Wilson Stone, and Brent Yonts.


Guests: Donna Early, Executive Director, Kentucky Judicial Form Retirement System; Honorable Chris Cohron, Warren County Commonwealth’s Attorney; Honorable J. Michael Foster, Christian County Attorney; Gina Carey, Executive Director, Office of the Prosecutors Advisory Council; and, Joe Barrows, Executive Director, Commercial Mobile Radio Service Board.


LRC Staff: Frank Willey, Linda Ellis, Jennifer Rowe, and Marlene Rutherford.


Judicial Form Retirement System

Donna Early provided a brief budget update and overview of the Judicial Form Retirement System (JFRS).


In response to questions from Chair McDaniel regarding total dollars requested in each year for the Judicial and the Legislative Retirement plans, Ms. Early said that the totals are $16.3 million for Judicial, and $3.3 million for Legislative. Total annual costs of the effects of the implementation of House Bill 299 are not recognized until an actual reciprocity is realized, which can only occur by reason of simultaneous retirement between both plans. Chair McDaniel asked for the number of active employees with an agency other than the General Assembly who will be eligible to take advantage of those provisions. Ms. Early stated the JFRS has no record of employment of legislators, but she will request the information from the Kentucky Employee Retirement System (KERS).


Chair McDaniel asked about rollover provisions in which legislators can max out inside the Legislative plan and then be rolled into the KRS. Ms. Early replied that the formula for calculating the retirement benefit for all state agencies is to take the final compensation, which is the average of the three or five years of salary multiplied by the service credit rate, or benefit factor, multiplied by years of service. Statutes governing the Judicial and Legislative plans state that once the 100 percent benefit level is reached, then the employee can go into the KERS plan. That level is reached whenever the 2.75 service credit rate is applied and multiplied by 36 years and four months. When legislators in the Legislative plan reach the 100 percent, which requires 36 years and four months, then they would be able to go into the other plan. This also applies to judges in the Judicial plan.


In response to a question from Representative Koenig regarding deficits and unfunded liability, Ms. Early said the Judicial plan is at 57 for the pension and 95 for medical insurance. The Legislative plan is at 58 on the pension side and 110 on medical insurance.


Unified Prosecutorial System

Chris Cohron and Mike Foster provided a budget update for the Commonwealth’s Attorneys and County Attorneys of the Unified Prosecutorial System (UPS).


In response to questions from Representative Stone regarding the increasing caseload, Mr. Foster said the Administrative Office of the Courts (AOC) maintains the numbers and he will provide them at a later date.


In response to questions from Representative Riggs, Mr. Foster said both Commonwealth’s Attorneys and County Attorneys are involved with internet crimes cases, but the Commonwealth’s Attorneys carry the majority of those. There is a mathematical formula in place for the allocation of funds using the number of cases in a given county, number of prosecutors in that county, and number of cases per prosecutor. Special circumstances that may impact that county are also considered.


In response to a question from Representative Koenig, Mr. Foster said all the requested appropriations are critical.


In response to questions from Chair McDaniel, Mr. Cohron said the UPS does not have any influence on court fees, which are set by statute. A high percentage of defendants in the criminal justice system are indigent and it would be unpredictable as to how the moneys would be collected, even if legislative authority is granted to allow the assessment of a court fee. Mr. Foster said the request for 25 positions at $30,000 each would also include benefits.


In response to a question from Representative Riner, Mr. Cohron said most UPS staff put in 37.5 hours by Wednesday of each week. Most work on weekends. The criminal justice system would come to a screeching halt if prosecutors only worked 37.5 hours per week.


In response to a question from Representative Koenig, Mr. Cohron said when looking at the budget allocations for each of the 57 judicial circuits, it becomes clear that the differentiation for urban areas is in place as much as possible within the allocation.


In response to a question from Representative Butler regarding inmate medical expenses and coordination with Medicaid, Mr. Cohron said those issues need to be addressed. He said the UPS reviews jail lists multiple times per week to make sure no one is held in jail who does not need to be. The UPS would not let finances override public safety. He said Kentucky and Louisiana are the only states that have a hybrid incarceration system, which has advantages and disadvantages.


            Commercial Mobile Radio Service Board

            Joe Barrows provided an update on 911 reporting requirements established by Senate Bill 119 of the 2011 General Assembly.


            In response to questions from Chair McDaniel, Mr. Barrows said a prepaid cell phone pays an average of 28 or 30 cents per month for the 911 service, as opposed to the 70 cents paid by regular carriers. He said the amount not collected comes to approximately $4 million to $5 million annually, and that disparity should be eliminated.


            In response to questions from Representative McKee, Mr. Barrows said the formula created in 2006 allows pre-paid cell phone companies to take the revenue made in Kentucky and divide it by 50, which is about the average amount of money an individual would spend on a cell phone. By doing that, a person would get the number of pre-paid customers in the state, and when multiplied by 70 cents, it is the amount that could be collected. The problem is the amount a pre-paid customer uses is 20, according to the FCC. So, by using 50 in the formula, only 40 percent of what could be collected from pre-paid cell phone usage is being collected.


            In response to questions from Representative Riggs, Mr. Barrows said secondary Public Safety Answering Points (PSAPs) dispatch, but do not answer emergency calls. The CMRS Board’s only jurisdiction is wireless, and when money is collected and sent to the PSAPs, it has a list of things that the money can be used for. The PSAPs are audited to make sure the money is being spent correctly.


            In response to questions from Chair McDaniel regarding the August 1 reporting deadline, Mr. Barrows said the CMRS Board conducts an annual survey of the PSAPs to determine how money is spent. When the report is completed, it is sent to the Legislative Research Commission pursuant to statute to be distributed as required. He hopes to have the information ready to present to the Military Affairs Committee in January 2014. Representative Riggs requested a PSAP to PSAP comparison showing how the 166 PSAPs are using funds and their efficiency rates.


            Chair McDaniel requested a motion to approve the minutes of the October 24, 2013 meeting. A motion was made by Representative Stone, seconded by Representative Koenig, and the minutes were approved without objection.


            There being no further business before the subcommittee, the meeting was adjourned at 11:59 AM.