Work Ready Kentucky scholarships, $8.10 per hour minimum wage bills clear House budget committee

03/08/2016 02:59 PM

FRANKFORT — The House Appropriations and Revenue Committee passed a pair of bills sponsored by House Speaker Greg Stumbo on Tuesday that would create a scholarship program for free community and technical college tuition and increase the state’s minimum wage to $8.10 an hour.

The former would be paid through existing money in Gov. Matt Bevin’s budget proposal and be available for students enrolling in community and technical colleges this fall while the latter could be seen as a retreat of sorts from prior proposals by Stumbo to raise the state’s minimum wage to $10.10 per hour.

House Bill 626, which passed on a 27-3 vote with two “pass” votes, would create the Work Ready Kentucky scholarship, administered by the Kentucky Higher Education Assistance Authority. Funds would be available to students who enroll in community or technical college in the semester following their high school graduation or by age 19 if they received a GED, with the program covering six semesters as long as students maintain a 2.0 grade-point average.

Stumbo, D-Prestonsburg, estimated that the scholarships would cost $13 million in the first year of the biennium and $20 million in the second, and Jay Box, president of the Kentucky Community and Technical College System, said about 37 percent of first-year students would be eligible under HB 626.

“What Tennessee has seen is about a 20 percent growth of that student body each year, and what we expect is really meeting the needs of the workforce and that we are getting students through the pipeline quicker because it is an incentive for them to take a full load, to be a full-time student,” Box said, referring to a similar scholarship program Tennessee Promise. “As you know, about 60 percent of our students are part-time, so this would encourage more students to go full-time.”

Another factor to consider, Box said, is that HB 626 would make it cheaper for students looking to move to a college or university after earning their associate degrees.

Some of those who voted against HB 626 or “pass” cited funding concerns in their decisions against supporting the legislation, saying they would like to see the source of Stumbo’s scholarship dollars. Even some who voted for the legislation, like Rep. Addia Wuchner, R-Florence, said they would like to have more information on how those scholarships will be financed.

The House speaker told reporters that he has identified money for the scholarships in various parts of Bevin’s two-year spending proposal, chiefly a new reserve account financed through a $500 million fund transfer from the health insurance fund for state workers. That money would be used to offset additional pension contributions in the future in Bevin’s plan.

Stumbo said those extra dollars could be used for the Work Ready Kentucky scholarships envisioned in HB 626, pivoting to add a defense of the state’s health exchange that Bevin wants to dismantle.

“There appears to be some excess money in the state employees insurance fund because of the fact that the rates have stabilized, which is another reason that I think the governor and others should rethink their position about abandoning Kentucky kynect,” he said. “It has stabilized the insurance rates here in Kentucky.”

Stumbo, in his appeal to the committee, said HB 626 represents a worthy investment for Kentuckians, a similar pitch he used for House Bill 278, which would raise the state’s minimum wage from $7.25 per hour to $8.10 an hour.

The legislation originally called for a three-year phase-in period for a $10.10 per hour minimum wage, but Stumbo said he offered the one-year, 85-cent increase in order to avoid confusion on the timeframe to lift the state’s minimum wage. Rep. Jill York, R-Grayson, and Rep. Jim Stewart, Flat Lick, helped send HB 278 out of committee on a 21-6 vote with five “pass” votes.

He said he hopes the amended legislation is more palatable for Republicans. Similar proposals have passed the Democrat-controlled House in recent sessions only to die in the Republican-led Senate.

HB 278, which would not apply to businesses that make less than $500,000 in average annual sales over the previous five years and address gender pay inequity, would “send a positive message to those folks, those some 26,000 Kentuckians who we believe are working in minimum-wage jobs who haven’t had an increase since July of 2009,” he said.

“This body would have the opportunity to come back and review that obviously next year if this bill were to become law,” Stumbo said.

The House Appropriations and Revenue Committee also passed a slew of budget bills in anticipation of a floor vote next week.

Rep. Rick Rand, chairman of the House budget committee, said the bills would get first and second readings from the House floor before being recommitted to the appropriations panel, and some Republicans on the committee asked Democratic leaders for ample opportunity to suggest revisions to the budget proposals.

Stumbo said he expects both pieces of legislation will pass the House.


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