Expanded gaming amendment an attempt to prevent cuts to retirement benefits, Dem. lawmakers say

09/25/2017 03:45 PM

“How are we going to pay for them? That’s the real question,” Rep. Rick Rand said, talking about billions of dollars in pension underfunding.

Rand, D-Bedford, and Rep. Dennis Keene, D-Wilder, are proposing a constitutional amendment which would allow expanded gambling at casinos and limited gaming at horse tracks as a way to deal with massive pension debt.

Gov. Matt Bevin’s administration assesses the underfunding of the state pension systems at more than $60 billion. The PFM Consulting Group has recommended a series of structural changes to lawmakers to consider, but none of the options deal with revenue.

“Rick was as stunned as I was, we were sitting in that room and it was all about cuts,” Keene said of the PFM report. “We just sat there and thought, well we can’t have this, so that’s when we went back to the drawing board and started looking at the gaming.”

The constitutional amendment that Keene and Rand propose would allow for four free-standing casinos in Kentucky, and allow slots at the horse-racing tracks. Keene said an LRC conservative estimate predicts $325 million in licensing fees, and $236 million in revenue from casinos.

“That does not include the border of Tennessee which has no casino gambling, so when they say you’ve missed that boat — we haven’t missed that boat — because there’s a whole new market in Tennessee, including that Nashville market which could be very advantageous for us,” Keene said.

In years past legislators seeking to expand gaming in Kentucky attempted to work with the horse racing tracks in an effort to protect their profits; with this attempt, Rand said they’re done trying to work with the tracks.

“We decided we’re just not as concerned with the horse racing industry,” Rand said. “I mean, we hope they do well, but they just can’t get their act together on this — they just can’t.

“Really, our motivation are these pensions and what we’re going to do on these pensions,” Rand continued. “The pensions are over 500,000 families in Kentucky rely on payroll or pensions from the state.”

Keene and Rand are hopeful that by prefiling the bill will will be considered in the 2018 session, and then ratified by the people of Kentucky on the ballot in 2019. The Democratic lawmakers hope discussion on their bill and the revenue for pensions starts during a yet to be called special session later this year.


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