Interim Joint Committee on Local Government


Minutes of the<MeetNo1> 3rd Meeting

of the 2008 Interim


<MeetMDY1> October 17, 2008


The<MeetNo2> third meeting of the Interim Joint Committee on Local Government was held on<Day> Friday,<MeetMDY2> October 17, 2008, at<MeetTime> 10:00 AM, in<Room> Cascade Ballroom C, at the Kentucky International Convention Center, in Louisville, Kentucky. Representative Steve Riggs, Chair, called the meeting to order, and the secretary called the roll.


Present were:


Members:<Members> Senator Damon Thayer, Co-Chair; Representative Steve Riggs, Co-Chair; Senators Walter Blevins, Jr., Julian M. Carroll, Ernie Harris, Alice Forgy Kerr, Elizabeth Tori, and Johnny Ray Turner; Representatives Scott W. Brinkman, Ron Crimm, Mike Denham, Richard Henderson, Charlie Hoffman, Dennis Keene, Adam Koenig, Tom McKee, Reginald Meeks, Brad Montell, David Osborne, Arnold Simpson, Ancel Smith, and Jim Wayne.


Guests:  First Lady Jane Beshear; Mayor Fred Siegelman, City of Versailles; Mayor Elaine Walker, City of Bowling Green; John Fitch and Chad Cogdill, Eastern Kentucky University; Jeff Day, Asbury College; Secretary Marchetta Sparrow, Tourism, Arts and Heritage Cabinet; Mayor Glenn Caldwell, City of Williamstown; Sylvia Lovely, J. D. Chaney, and Temple Juett, Kentucky League of Cities; and Larry Kline, City of Covington.


LRC Staff:  Mark Mitchell, Joe Pinczewski-Lee, John Ryan, and Marlene Rutherford.


The minutes of the September 24, 2008, meeting were approved without objection. 


First on the agenda was First Lady Jane Beshear who discussed the impact of the film industry in Kentucky and on local governments. She said that there are many marketing opportunities to create an image for the state because of the state’s beautiful landscape and because of the different landscapes within the state, is more economical for film companies to move from one area to another within the state in making a film. First Lady Beshear pointed out that many productions about Kentucky have been or are being lost to other states because there are no incentives to lure them to the state, and that support costs would be very little to Kentucky in terms of the economic impact to the state and local communities. She noted that in these troubling economic times we need to “think outside the box” and create mutual incentives that work for Kentucky. 


Joining the First Lady were community leaders who discussed how the film industry had impacted their communities. 


Mayor Fred Siegelman of Versailles told how rewarding and successful the movie “Elizabethtown” was for his city and that people from surrounding areas came to the city for the filming. 


Mayor Elaine Walker, City of Bowling Green, is very familiar with the film industry because her husband is a filmmaker and she said aggressiveness is required to attract filmmakers. She said filmmakers enjoy Kentucky’s scenery and that for purposes of economic development, it means that sometime you have to give up a little to gain a lot. 


Professors John Fitch and Chad Cogdill, Assistant Professors of Communication at Eastern Kentucky University, talked about the film industry as it relates to students. Professor Fitch said that students seeking motion picture degrees have increased 300% and that the film industry is utilizing EKU students in film productions. Professor Cogdill indicated that providing job and internships to students would be an advantage. 


Professor Jeff Day, Assistant Professor and Director of Theatre and Cinema Performance at Asbury College, also discussed how the film industry affects students. He said that Asbury College had invested $2.5 million in technology and a building for theatre and cinema because of the interest of students. Professor Day noted that many students are moving to California to be close to the film industry. 


Secretary Marchetta Sparrow, Tourism, Arts, and Heritage Cabinet, also encouraged support of this industry in Kentucky.


Due to technical difficulties, a short film that showed what the state has to offer to the film industry was not able to be shown, but the First Lady said she wanted communities to know the opportunities and incentives this can bring to Kentucky and would be happy to attend another meeting to show and discuss the film. Providing incentives to this industry will provide jobs, keep our youth interested in the arts in Kentucky, provide tourism, and economic development. 


Representative Montell indicated that the committee needs input from the people that have been involved in this area. He said that the state is in a unique position with the Ryder Cup and the 2010 Games. Referring to productions that are pending inducements, he asked what the timeframes were for decisions on incentives and whether the state was in danger of losing out on these productions being filmed in Kentucky. The First Lady indicated that many are waiting to see what incentives Kentucky will bring to the table. Interested parties would like to film the productions in Kentucky because they are Kentucky stories and there are ideas that are on the drawing board at this time. 


Mayor Walker pointed out that it is not just about the incentives but to look at how much is spent in the communities. 


Representative Denham noted that filming in his region had been a very good economic impact for the area and that one of the best outcomes was that it brought the community together for a common cause. 


The First Lady noted that native Kentuckian, Ashley Judd, is interested in filming in Kentucky. She reminded the committee of the number of world visitors and viewers Kentucky will have for the 2010 Games which is estimated at 500 million people. And, there are a number of residents and ties to the film industry already located in the state. 


Representative Riggs asked how coordination with the local governments would work concerning incentives. The First Lady indicated that they were trying to put together an incentive package for the entire state. 


Senator Carroll said that Kentucky needs to be ready to capture the opportunity when approached to promote the state.


Next on the agenda were Ms. Sylvia Lovely, CEO and Executive Director of the Kentucky League of Cities. Joining her were Mayor Glenn Caldwell, Kentucky League of Cities President and Mayor of Williamstown, Mr. J. D. Chaney, Director of Governmental Affairs, and Mr. Temple Juett, General Counsel, Kentucky League of Cities. They discussed the platform for the 2009 Session of the General Assembly. Ms. Lovely indicated that the number one priority for the 2009 Session will be pension reform.  She also discussed “Your City, Your Future” initiatives. Recent studies have shown that young people look for a place to live, then look for a job; there is a “New Localism”--people who have left are returning to Kentucky. By the year 2050, people will live in or around eight super cities. While Kentucky has none, it is situated close to those cities such as Atlanta, Chicago, and Charlotte.


Mr. Juett reiterated that the primary focus will be on pension issues. He said that House Bill 1 did not extend the short term relief and that rates will increase once the one time rate reduction ends next year. Mr. Juett stated that KLC supports full-funding but that the actuarially required contribution (ARC) should be extended, the five year initiative is too short, and that if the state has 20 years, local governments should have 20 years also. He indicated that the League is interested in other retirement related issues of healthcare and classified school employees. Mr. Juett also discussed the idea of a Local Government Employee Retirement System. He stated that KLC’s primary position is to give short term relief to local governments. 


Senator Carroll asked whether a reduction in the monthly contribution to the retirement fund would have an effect of a shortfall. Mr. Juett said it would not. He said the annual contribution which leads to full funding on the pension system is for healthcare. Senator Carroll also asked what cities are doing to control healthcare benefits. Ms. Lovely said that cities are using any resources and programs they can to bring down the costs.


Mr. Chaney also briefly discussed pensions and the need to restore monies lost by local governments from the telecommunications tax. He said approximately $7.5 million needs to be added for each year since the passage of the legislation, or $22 million, to the hold harmless fund to make up for the revenues local governments have lost. He also said that cities are opposed to mandated centralized collection of occupational license fees.


Mr. Larry Kline, Assistant City Manager, City of Covington, discussed charter county governments. He said that the process of creating a charter county government is biased in favor of counties because the commission is county-dominated and is presided over by the county-judge executive. KLC urges an amendment to the statute for equal membership among city and county governments and that the charter county commission chooses a presiding officer.


Mr. Kline also said that progress has been made at the local level to simplify the administration of occupational license fees. He noted that the rules are not different from county to city statewide--only the rates are different. He also pointed out that in Boone, Campbell, and Kenton Counties, free tax preparation is available to businesses if a taxpayer finds the forms too confusing. Local businesses and taxpayers are better served at the local level with local representation that is accessible, responsive and accountable.


There being no further business, the meeting was adjourned at 12:00 p.m.