Tax cuts, gambling and medical marijuana: Kentucky legislature returns with big bills on tap

The Kentucky General Assembly returns from their 4-week break Tuesday to resume the 2023 session, with the Republican supermajority expected to hit the ground running by giving final passage to its top-priority tax cut bill.

While Republicans are unlikely to take up any major new spending in the 30-day short session, there are still some significant bills that could advance this session beyond the individual income tax rate cut, tackling issues like the juvenile justice system, gambling and marijuana.

And while 185 bills were filed by legislators in the first four days of the session, many of the most highly anticipated bills of this session are yet to come, expected to be filed at some point in the next two weeks.

Updating list:Here's the latest on key bills from the 2023 Kentucky legislature

Here's a look at some of the key bills and issues expected to be advanced and debated in the final 26 legislative days of the short session, which ends March 30.

GOP tax cut bill expected to move fast

House Bill 1, which would cut Kentucky's individual income tax rate from 4.5% to 4% beginning next year, has already been running at a sprinter's pace, with House Republicans clearing it through the chamber on the third day of the session in a near party-line vote.

The Senate could conceivably give final passage to the bill on its first day back and is expected to do so by at least the end of the week, with Republicans in lock step on their top issue of tax cuts and dominating the chamber.

More:What you need to know about the bill to cut Kentucky's income tax

While all but one Democrat in the House voted against the bill and other left-leaning groups oppose it — arguing it implements permanent tax cuts that disproportionately benefit the wealthy, based on temporary revenue surpluses that may vanish once federal pandemic aid dries up or a recession strikes — Beshear has not indicated what he will do.

Beshear, a Democrat running for reelection in a largely GOP state, said in January he is "keeping an open mind" on whether to sign or veto the bill.

Last year he vetoed a bill to cut the income tax rate from 5% to 4.5% last year, though he said he did so because it also ended sales tax exemptions on certain services. He noted he preferred cutting the sales tax by 1 percentage point.

Limited spending in non-budget year

Republican leaders have ruled out "reopening" the state budget passed last year, but they have indicated there may be some limited new appropriations — like the $16 million for a new Bowling Green veterans nursing home in HB 2, expected to pass with HB 1 this week.

Another area likely to receive more funding involves the Department of Juvenile Justice, whose detention facilities have seen riots and violence over the past year.

Rep. Kevin Bratcher, R-Louisville, indicated last week he would file HB 3 on Tuesday to appropriate roughly $9 million to reopen a youth detention facility in the city, and the bill may also include changes for youths charged with violent crimes that are similar to his bill that cleared the House in 2022 but stalled in the Senate.

More:Louisville may get its own youth detention center amid juvenile justice crisis

Besides calls for more appropriations to raise worker wages at youth detention facilities, Beshear and education advocates have called for more money for across-the-board raises for public K-12 teachers, citing teacher shortages.

But leaders with the Kentucky Association of School Administrators indicated last week they do not expect Republicans to advance any significant appropriations for teacher raises until 2024.

While some have also called for additional spending to address housing shortages for victims of the Eastern Kentucky flooding last summer, Senate President Robert Stivers said in January there is still sufficient money left over from what was appropriated in 2022.

Gambling, bourbon and marijuana

One of the most expensive fights over legislation in the 2022 session is likely to repeat itself, as competing bills are expected to be filed this week addressing the slots-like games proliferating in convenience stores and fraternal halls.

Called "skill games" by supporters and "gray machines" by opponents, there has not been a definitive court ruling on whether the games with cash payouts are legal. While a bill to ban them passed both chambers last year, they could not agree on a version before the session adjourned.

Two competing groups already have spent considerably on ads to sway the argument, with Kentuckians Against Illegal Gambling supporting another effort to ban the games and the Kentucky Merchants and Amusement Coalition backing a bill to regulate and tax the machines.

More:Expensive fight over slots-like 'gray machines' looms in Kentucky legislature

Related to gambling and taxes, Republicans are likely to file another bill to legalize, regulate and tax sports wagering. A bill to do so passed the House last session but died in the Senate.

Supporters of the bourbon industry are also expected to have a bill filed reducing property taxes on the value of their barrels, though local governments and school districts have said this could jeopardize their tax revenues.

After passing the House twice in recent years, a bill to legalize and regulate medical marijuana will start in the opposite chamber this session, with Senate Bill 47 of Sen. Steve West, R-Paris.

And while medical marijuana bills have died in recent years, advocates are more optimistic this year because of an influx of new Senate Republicans who support legalization. Meanwhile, delta-8, a marijuana alternative that allows Kentuckians to get high legally, is being sold across the state.

Health care, culture wars, elections and impeachment

Here's a quick breakdown of other bills filed or expected to come soon related to key issues:

• In the area of health care, SB 48 has been filed to reorganize the Cabinet for Health and Family Services and move child support enforcement to the attorney general's office, while HB 54 would extend Medicaid coverage to midwifery services and HB 129 would allow freestanding birthing centers.

• Legislation related to abortion access in post-Roe Kentucky is expected to be filed, but what form those bills take — potentially adding more restrictions or exceptions — will depend on the actions of the state Supreme Court in a case challenging the current abortion bans.

• At least two bills have been filed regarding transgender children, with HB 30 restricting what restrooms trans students can use and HB 120 prohibiting health care providers from providing minors with gender-affirming medical care.

• Rep. Savannah Maddox, R-Dry Ridge, has filed two bills related to gun rights, with HB 118 decreasing the age of those who can concealed carry from 21 to 18 years of age and HB 138 allowing guns in more government buildings and schools.

• A year after the legislature banned the death penalty for people with certain documented mental illnesses, SB 45 seeks to ban all uses of the death penalty.

• Republican Secretary of State Michael Adams is expected to support a bill filed soon to limit election recounts to close races, as he criticized several recount requests by candidates who lost by blowout margins in the GOP primaries last year as "frivolous" and a waste of time and resources.

• A House committee is taking up the possible impeachment of two prosecutors accused of misconduct, with one having already announced his retirement and another indicating he will fight his removal.

Reach reporter Joe Sonka at jsonka@courierjournal.com and follow him on Twitter at @joesonka.

This article originally appeared on Louisville Courier Journal: Kentucky tax cuts, gambling bills: What's next from KY legislature