balancing the scales - February 2011

Volume 30 Number 1

February 3, 2011

Change Service Requested Kentuckians For The Commonwealth P.O. Box 1450 London, Ky. 40743

balancing the scales Building New Power

NON-PROFIT U.S. POSTAGE PAID LEXINGTON, KY. PERMIT NO. 513

KFTC members and allies help build a clean energy economy across Kentucky Photo by Zoe Strecker

Inside...

Kentuckians gather to move Clean Energy economy forward … page 3 Clean Energy Opportunity Act now before General Assembly … page 9 And much more Solar Installation Businesses Small-scale Hydro

Solar Energy Projects Wind Energy Projects Hydroelectric Projects Clean Energy Job Training Programs The larger the circle the more projects in that community

Map created

by Bob Dixon January 20, 2011

Counties with Clean Energy Projects funded by federal stimulus money

Weatherization Solar Heating and Hot Water

Geothermal Heating/Cooling

Community Energy Project

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balancing the scales, February 3, 2011

Editorial Page

Remembering Kathy Mathea’s challenge On January 8, KFTC members shared the nation’s outrage at the shootings in Arizona, and the sympathy for those killed and wounded and their families. In times like these KFTC members are reminded of our responsibility to work together to find solutions to our problems, no matter how divisive the issue. Kathy Mattea reminded us of this in her I Love Mountains Day speech last year: What we need, in Kentucky, in West Virginia, in Virginia and Ohio and Tennessee and, yes, in Washington, DC … is LEADERSHIP. We need leaders who care more about the long-term prosperity of their constituents than their own political careers. We desperately need a way of having this conversation that goes beyond the short term. We need courageous leaders who are willing to step into the center of this vortex and hold the vision of the long-term solution, through all the desperation, the noise, and rage, and fear. …………

I believe it starts with listening. I believe we have to learn to sit still, to open our hearts and HEAR the SHARED ANGUISH we all have in common. And it starts with letting go of blame. Accountability, yes. But if we blame each other in a desperate attempt to be heard, or to maintain our sense of power, then how can we ever come together? ……..

EVERYONE wants to feel safe where they live.

EVERYONE needs a way to provide for their family.

EVERYONE needs a home, a place to live in peace.

I pray that we can find a way to refrain from taking our pain out on each other, and continue to work towards a vision of an economy and an environment where ALL people here in the coalfields can thrive, so that this moment, and this process, can stand as a monument to what is possible when people work together, and as an inspiration for future generations.

Last Gift Date Printed On Front Cover!

We’ve heard from a lot of members that they would love to stay current in their membership dues, but just don’t know when their renewal date is. So now we are printing your last gift date with your mailing label*.

Renew by mail: Send a contribution and the form on page 16 to our main office.

Renew by phone: Call Morgan in our London office and she can take a credit card, 606-878-2161.

Renew online: It’s easy to make a donation online by check or credit card. Just go to www.kftc. org/donate.

Become a pledger? When you renew your dues, consider becoming a pledger. Your regular contribution to KFTC supports the work all year long, and when it’s automatic you can always know that your dues are current.

* Let us know if the last gift date looks wrong. Databases can be imperfect. Keep in mind that it takes about two weeks for the paper to be printed and on your doorstep. If you’ve made a donation in that time, it won’t make it on the label.

Kentuckians For The Commonwealth is a statewide grassroots social justice orga­­ni­ zation working for a new balance of power and a just society. KFTC uses direct-action organizing to accomplish the following goals: • foster democratic values • change unjust institutions • empower individuals • overcome racism and other discrimination • communicate a message of what is possible • build the organization • help people participate • win issues that affect the common welfare • have fun KFTC membership dues are $15 to $50 per year, based on ability to pay. No one is denied membership because of inability to pay.

Membership is open to anyone who is committed to equality, democracy and nonviolent change.

KFTC Steering Committee Steve Boyce, Chairperson Sue Tallichet, Vice-Chairperson Dana Beasley Brown, Secretary-Treasurer K.A. Owens, Immediate Past Chair Rick Handshoe, At-Large Member

Chapter Representatives

Rosanne Fitts Klarer, Scott County Erika Skaggs, Central Kentucky Ted Withrow, Rowan County Scott Goebel, Northern Kentucky Mary Love, Jefferson County Meredith Wadlington, Bowling Green & Friends Carl Shoupe, Harlan County Truman Hurt, Perry County Megan Naseman, Madison County Patty Amburgey, Letcher County Beverly May, Floyd County Cari Moore, Knott County Vanessa Hall, Pike County Alternates: Matt Doolin, Matt Heil, Lisa Bryant, Antonio Mazzaro, Martha Flack, Sandi Joiner, Stanley Sturgill, McKinley Sumner, Steve Wilkins, Jeff Chapman-Crane, Bobby Hicks, and Erica Urias.

Kentuckians For The Commonwealth P.O. Box 1450 London, Kentucky 40743-1450 606-878-2161 Fax: 606-878-5714 info@kftc.org www.kftc.org balancing the scales is published by Kentuckians For The Commonwealth and mailed third class from Lexington, Kentucky.

Reader contri­butions and letters to the editor should be sent to 250 Southland Drive Suite #4, Lexington, KY. 40503 or tim@kftc.org.

Subscriptions are $20 per year.

balancing the scales, February 3, 2011

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Sustainable Energy Update

The Sustainable Energy Campaign is...

Large crowd at clean energy summit shows breath of interest in bringing benefits to Ky.

Many Kentuckians demonstrated that they are ready for the benefits that clean energy will bring to Kentucky by attending the first-ever Kentucky Clean Energy Summit on January 31.

Hosted by the Kentucky Sustainable Energy Alliance (KySEA) and cosponsored by KFTC, the gathering brought small business owners, housing groups, low-income advocacy organizations, legislators, energy experts, and concerned citizens together with a shared interest in the jobs and health benefits clean energy will bring.

More than 150 people attended the summit, which had been sold out weeks in advance.

Mary Miller of Midway, a board member of Kentucky Watershed Watch and a member of the Sierra Club and KFTC, came to the conference to learn more about how to communicate effectively with legislators.

“I asked questions that I’ve been curious about forever,” she said. “It just makes you aware of what all’s going on and how these groups can work together.”

During the day, summit speakers and attendees explored:

• Policies that would increase use of energy efficiency and renewable energy in Kentucky; • The benefits of these policies and why Kentucky should pass these now; • Success stories from nearby states, including Ohio;

KFTC leader Mary Love gave the welcoming address at the Clean Energy Summit.

• The experiences of KySEA member organizations including small businesses and affordable housing providers that are utilizing energy efficiency and renewable energy today.

The Clean Energy Opportunity Act, recently filed by Representative Mary Lou Marzian in the 2011 General Assembly and supported by KySEA, is a comprehensive clean energy bill that would set clean energy goals for Kentucky and provide incentives for clean energy businesses. Summit participants got a first look at what’s in the bill.

The Clean Energy Opportunity Act (House Bill 239) would establish a renewable and efficiency portfolio standard (REPS) and feed-in tariffs (FITs) for Kentucky. An REPS would require electric utilities to meet specified energy efficiency and renewable energy goals by a specified date. FITs are set rates that utilities would pay when purchasing renewable energy produced in Kentucky.

If enacted, the bill would: • Create local jobs and grow Kentucky’s economy by attracting new clean energy businesses; • Save money for Kentucky families, farms and businesses through increased energy efficiency; • Improve Kentuckians’ health and environment by increasing our share of clean energy and decreasing our use of polluting fuels such as coal; • Build on Kentucky’s clean energy momentum; • Not cost the state any tax revenue.

Carmen Stine and Shari Bivelacque of Alternative Energies Kentucky, a new business in Danville that manufactures solar panels, said starting a clean energy business in a state where there are no incentives or guidelines has been a challenge. Many of their clients are outside Kentucky.

“How do you sell to people who have no incentives to improve their situation and their carbon footprint?”

asked Stine.

“If there’s a financial incentive, then they start to listen,” said Bivelacque.

Getting state leaders on board will be key, Bivelacque said.

“For us to get anywhere with this, it’s going to be all about education,” she said.

And jobs, according to Rep. Marzian. “I think the job piece is what’s so important to effect policy change in Frankfort.”

Andy McDonald of Kentucky Solar Partnership said Kentucky needs to take a long-term view.

“We really need long-term stable policies,” McDonald said. “There’s no point in getting trained if there’s not going to be jobs.”

David Brown Kinloch, who with his partners purchased and restored the Mother Ann Lee Hydroelectric Station on the Kentucky River, echoed the view that Kentucky needs to make a long-term investment in clean energy.

In addition to his work in hydro-power, Kinloch has researched wind power in Kentucky.

“It’s a political problem, not a technical problem, why there isn’t wind [energy generation] in Kentucky,” he said.

Representatives of the Federation of Appalachian Housing Enterprises (FAHE), Frontier Housing, Home Energy Partners and the Metropolitan

Working with allies, we formed the Kentucky Sustainable Energy Alliance (KySEA) to promote good energy policy in Kentucky.

Members come from the housing, farming, nursing, environmental, energy, faith and housing sectors, and all have an interest in clean, affordable energy. Energy efficiency, renewable energy, green jobs and protecting lowincome residents are top priorities.

We are also involved in regional and national energy coalitions.

Housing Coalition expressed their desire to see new policies that protect homeowners, renters and low-income families from rising energy costs.

“I’ve heard a lot today about energy efficiency as a resource, and I really like that term,” said Vonda Poynter of FAHE, a regional nonprofit based in Berea that provides access to capital that creates housing and promotes community development.

KFTC is a founding member of KySEA, and KFTC members played a role in the agenda throughout the day.

Mary Love of Jefferson County delivered the welcome address, and Doug Doerrfeld of Elliott County discussed environmental impacts as part of a panel on The Case for Clean Energy Policies in Kentucky.

Visit www.kysea.org to download Powerpoint presentations from the day and to read blog posts about what various summit speakers said.

The number one state energy priority identified by the largest number of Kentucky residents in a 2008 public survey was “transitioning to renewable energy sources.”

Opinion Resource Corporation poll

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balancing the scales, February 3, 2011

Local Updates

Harlan County effort to protect water called “frivolous” concerns were “frivolous.”

“To me, as a resident of Benham, the fact that the state deemed our petition frivolous is enough to tell me and my fellow mountain people that Black Mountain doesn’t mean anything to the state of Kentucky,” said disabled coal miner and KFTC member Carl Shoupe. “They care more about the elk that they brought in than the people who live here.”

Shoupe and his neighbors recently filed a petition with the Kentucky Energy Cabinet asking that vulnerable areas of the communities be declared “unsuitable for mining.” That’s a provision in federal mining law to protect unique areas.

State officials denied the petition and said it was frivolous.

“How can a government and all its legislators turn against so many in the name of a block of coal?” asked member Stanley Sturgill. “It appears southeast-

KFTC members in central Kentucky (above) and northern Kentucky participated in lobbying trainings recently, in preparation for visiting with legislators.

“If the Beshear administration is willing to sacrifice all that, we’ll have proof positive that the rights of Kentuckians now mean less to their government than the prerogatives of coal companies.”

ern Kentucky has been sold out in the name of Big Coal.”

Residents wish Gov. Steve Beshear would come see for himself and listen to the hopes of residents for their community before blocking their efforts.

“We’d be honored for the governor to come to eastern Kentucky and give us a shot to show the true reality of what’s really going on,” said Shoupe.

Residents were encouraged when a supportive editorial was printed by the Lexington Herald-Leader.

The newspaper listed many of the positives the communities have going for them, and concluded:

“I think it’s great,” Sturgill reacted.

“By our efforts of telling the truth about what’s going on in eastern Kentucky as far as the destruction of our mountains by radical strip mining and blasting, maybe other people in other parts of the state are starting to see that we are getting screwed and jobs are being destroyed,” added Shoupe.

Controversial logging plan in nearby forest sparks concern in Madison County chapter

Madison County chapter members are working with members of an allied organization, Kentucky Heartwood, to map out a possible organizing strategy to oppose the commercial logging of 600 acres of the Daniel Boone National Forest in neighboring Rockcastle County.

The proposed area is above several water springs and would use toxic herbicides to kill vegetation.

“The reason we started working on this project is because it is so close to home,” explained Rockcastle County member Tress Spencer.

“A lot of our friends and family raise their families close to these springs and drink the water,” Spencer continued. “It is really important to keep our water clean and families healthy. They shouldn’t think they can go put whatever they want into it.”

Members are worried that the “Crooked Creek Vegetation Management Project” would: • Ruin the diversity of the forest by logging in an area where significant portions of the forest were logged as recently as 20 years ago.

• Open the forest to invasive species.

• Require the use of toxic herbicides in the watershed of numerous springs.

• Cut nearly all the trees on 93 acres.

Kentucky Heartwood photo

Residents of the Benham and Lynch communities in Harlan County, located at the foot of Black Mountain not far from the Virginia border, are taking a number of steps to preserve the beauty, history and culture of their communities.

They’ve restored historic buildings and created some attractive tourist destinations. They’re challenging several coal mining permits that threaten their local water supply and natural beauty.

They created a community energy project to promote energy conservation and efficiency. They applied for grant money for a renewable energy and energy efficiency project.

These efforts got support and cooperation from state tourism officials. But when they asked the Beshear administration to support efforts to protect the land and water that are essential to the communities’ well-being, they were told their

Here’s a remarkably large tulip tree in an area proposed for logging. There are several large trees like this that may be cut. The Forest Service inventory says these trees aren’t there.

More than 300 public comments were received when the commercial logging proposal was announced last year.

To learn more about the project, visit www.kyheartwood.org.

balancing the scales, February 3, 2011

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Local Updates

Perry members celebrate Martin Luther King’s legacy

To honor the life, legacy and leadership of Dr. Martin Luther King Jr., the local NAACP continued the Perry County tradition by co-hosting a community breakfast with the Hazard Community and Technical College (HCTC) and a march downtown.

The celebration brought friends and allies from several surrounding counties together to celebrate their diversity and commitment to “move the dream forward,” the theme of this year’s event.

KFTC members from the Perry County chapter were there to celebrate this day of community engagement and dedication to social justice.

“It is good that local communities can share fellowship,” said KFTC member Russell Oliver. “As time went on … King began to see the larger issue that he was to fight for: the issue of the poor and injustice that crossed race, creed, gender and other divisions that man used to separate people into factions.”

The breakfast included tabling by community organizations, a children’s craft space, native flutist performance, a keynote speaker, a reading byAffrilachian poet Ricardo Nazario y Colon, and the lighting of candles in honor of Perry County educators of color. Local media outlets were even there to cover the day

of celebration and highlight the work of the NAACP and allies.

While singing We Shall Overcome, KFTC members joined the march through downtown Hazard to the Consolidated Baptist Church. There, the church family and visitors celebrated King’s dream through song, fellowship, and food.

Rev. John Pray of the First Baptist Church of Town Mountain spoke about his family’s dedication to military service to this country and the history of people of color who have served and died in our country’s wars. He expressed sadness at the institutionalized underand misrepresentation of Black history in this country.

Ludrenia Hagans-Shepard, NAACP president and HCTC professor, built on his words to finish the event. She stressed the importance of moving King’s dream forward through our children and dedication to the education of the next generations.

“King can be a great inspiration to each of us. King’s life showed that one person’s life can make a difference, and that each of our one lives can make a difference,” Oliver said. “We should strive to help each person to realize that they are someone special, and no matter how small their contribution

Scott County KFTC members are staying active with an impressive array of work including fundraising, lobbying, community events like the recent Martin Luther King Jr. march, phone banks, and more.

Late last year, the chapter adopted

a local issue campaign for the first time – creating a program for curbside recycling in the city of Georgetown and working alongside of the Georgetown College Green Team group to do it.

Members are still researching the best ways to create a strong recycling

Scott County KFTC members joined the local celebration of the life and dreams of Dr. Martin Luther King Jr. KFTC members throughout the state joined local activities to help keep the dream of racial and economic equality alive. seems to themselves or to others, their life is very unique and important.”

Perry County chapter members enjoyed honoring the legacy of an important civil rights and social justice leader and local heroes in the fight for more equality. They also connected with

Local activities keep Scott County members busy

Scott County members at their recent chapter meeting

program, but have already had some of the first meetings with city council members and plan to meet with many more in the coming months.

At their January meeting, members had a conversation about KFTC’s New Power Leader program, and everyone in the room pledged to become a new power leader and to be in contact with 5-20 others as part of that organizing strategy.

Members also want to take a more intentional look at trainings and leadership development. To that end, they scheduled a lobby training for February, an Organizing 101 training for March, and intend to schedule a membership recruitment/ fundraising training later in the year.

The Scott County chapter meets on the first Thursday of every month at 7 p.m. at the Georgetown Public Library.

new and old friends and will be following up with folks who expressed interest in KFTC’s voting rights campaign.

Throughout the state …

KFTC members in Scott County and Lexington also came out on January 17 to participate in community marches and other events celebrating the life, accomplishments, and as-of-yet unfulfilled dreams of Martin Luther King Jr.

The Lexington MLK Freedom March was likely the largest event in the state, bringing out many thousands of people to walk in solidarity with one another.

In Scott County, the NAACP organized a march and ceremony with about 150 participants.

At each of these events, KFTC members talked about our campaign to restore voting rights to former felons who have served their debt to society.

Kentucky is one of just two states that still disenfranchise all former felons (unless they get a pardon from the governor).

This practice takes voting rights away from one in four African Americans.

Members passed out around 500 leaflets about the issue and had good conversations with allies and some legislators along the march route.

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balancing the scales, February 3, 2011

Local Updates

Charles Taylor describes Closplint’s coal truck problems

My name is Charles Taylor. My friends call me Chuck, and I have lived in this community since 1977. We always took pride in our homes and community.

However, coal mining moved in and began to change our lives against our will.

The last several years our living conditions have changed for the worse thanks to the coal operators who moved in and control everything. There are several deep mines running coal with one pretty big strip job just getting started.

Our problem is coal trucks with the mud, dust, unsafe driving conditions, noise, and diesel smoke that goes with them.

After having a few community meetings with the help of other Harlan County chapter members, we met with coal company officials over a year ago and asked them to clean it up. We requested a vacuum truck. Although they bought one, they very seldom run it through here. They also concreted about 200 feet on the exit from the mine. There is also pavement above the concrete.

We also requested a truck wash and they never did that; however they have a water truck and use it some at the exits for 100 feet or so at several locations. That is not enough. They start about 5:30 a.m. and quit about 5 to 6 p.m.

We have made many complaints to the Department for Natural Resources in Kentucky and even met in Hazard with Carl Campbell, the DNR’s commissioner.

We have filed many complaints with the state and requested help from OSM, the federal agency in London. We have also contacted David Lloyd from the federal EPA Region 4 in Atlanta.

We have sent pictures of the toxic dust and

told them how bad it is here.

My neighbors and I are growing weary and frustrated with the agencies’ lack of effort to protect us and their bias towards the coal companies. They force us to have to appeal their decisions and leave us to prove this stuff is happening.

I have experienced tricky camera work, and being delayed so the coal company could clean up, when on down the road it is clear to see mud and mine silt was trucked through our communities without the state giving any violations. Many complaints made resulted in no citations.

All of us have many pictures and stories and frustration and worries of our health and homes being destroyed.

We are just common people. We don’t have the money to move out of such a place they have destroyed. We are faced with breathing toxic dust and who knows what else. All the dust and moisture creates the atmosphere for mold and mildew to grow on and in our homes. All the toxic air causes several kinds of cancer.

I have made a few videos of these problems over the last year that show it is no better. Please view at http://youtube. com/TheMountainlife and share this with everyone you know. Ask them to call the EPA and explain why they don’t or can’t protect us like other places in the USA. I don’t understand why the coal companies can’t put forth more effort to be a good neighbor.

It should not be like this. I worked a job and the company had some of us use shovels to clean the road every time some mud dropped onto it, and then we would spread chemicals onto the road to just dampen it.

The communities of Benhan and Lynch were named to the 11 Most Endangered Historic Places list in 2010. Learn more about this recognition and see a slide show of the communities at: http://bit.ly/cvw2Bz

[Then] it never got like this. It seems like road construction like what I did plays by different rules than coal companies in small communities. Is enforcement for some and not others? Are some communities better than others? I think people living in nicer communities would

not be done this way.

We deserve better! We’re going to figure out how to use litigation, publicity through videos and other means to get the companies and the state to do the right thing and protect our homes and communities.

This deeply rutted and muddy road makes for miserable driving for Bannerfork residents in the Wallins Creek area of Harlan County.

Mining begins, problems start for Wallins Creek residents Sandlick Coal has started mining and using the county road in Wallins Creek in Harlan County.

“Heavy equipment was being brought in late at night like they were trying to sneak it in without us being aware,” said resident Jack Ball.

In the days that followed, trucks started running daily.

“The upper road has caved in and had to be graveled. What once was paved and decent isn’t fit to run a car on,” Ball described. “The mud is unbearable and nothing is being done to control it. The main road leading from the hollow is mud covered, and it is impossible to keep a vehicle clean.

“What concerns me most is what is going to happen to the value of our property and why are they using a narrow one-lane road and a bridge only rated at 15 tons for their muck trucks?”

The quality of life for local residents is being impacted dramatically.

“There is no peace or quiet around the house until it’s dark. Since the upper road has been demolished from trucking, the lower road has had more traffic because people don’t want to tear up their vehicles,” Ball added.

The damage to homes also started just a few days after the mining began.

“The blasting shakes our homes.

The wall in the back bedroom is now cracked and the partition from the bathroom to the living room is cracking as well,” Ball described. “The flooring on the back half of my house pops like a home that has been around for many years.”

Residents have started organizing to get more local residents involved in correcting these problems. They are doing outreach to publicize the situation and have contacted local elected officials, state mining inspectors and the local newspaper, which has come out and interviewed residents.

balancing the scales, February 3, 2011

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Canary Project Update KFTC, allies ask court to allow citizens to intervene in Clean Water enforcement case

KFTC and allies were back in Franklin Circuit Court on January 27 asking that citizens and public interest groups be allowed to intervene in an important Clean Water Act enforcement case.

The Beshear administration took the opposite position, arguing that citizens have no legal interest in the state’s clean water enforcement actions. They supported the arguments of the two coal companies guilty of those violations.

Judge Phillip Shepherd said he would issue a ruling promptly.

“Prevention, abatement and control of water pollution are in the public interest,” stated Mary Vance Cromer of the Appalachian Citizens Law Center in support of the citizens’ Motion to Intervene.

She cited specific provisions in the

federal Clean Water Act that “allowed and encouraged [citizens] to fully participate,” and that specifically required states to not oppose citizen intervention.

Arguing for the Kentucky Energy Cabinet, Mary Stevens said that what holds true for federal law is not necessarily applicable in the state. “While they [citizens] have a clear interest in clean water, that is not a legally protectable interest in the state of Kentucky.”

She and the other company attorneys argued that state court has no jurisdiction in a case brought under federal citizen intervention provisions, and that the proper venue is where the violations occurred, not in Franklin County.

In their written brief, they stated that having to deal with citizens would be an

Leeco put on notice for illegal discharges of toxic selenium

The Sierra Club and KFTC took action in January to hold yet another Kentucky coal company accountable for its pollution of local waterways.

In a 60-day Notice of Intent to Sue sent to Leeco (part of James River Coal Corp.), the groups assert that the mining company is illegally releasing toxic selenium into several waterways in Letcher County – including Bull Creek, Montgomery Creek, Defeated Creek, Upper Lick Branch, and associated tributaries – without a permit, a violation of the Clean Water Act and the Surface Mining Control and Reclamation Act. The company’s own water monitoring reports, filed with the Kentucky Division of Water, show that its mines are discharging harmful quantities of the pollutant.

Selenium, a toxic element that causes reproductive failure and deformities in fish and other forms of aquatic life, is discharged from many surface coal-mining operations across Appalachia. At very high levels, selenium poses a risk to human health, causing hair and fingernail loss, kidney and liver dam-

age, and damage to the nervous and circulatory systems.

“Selenium threatens our fish and other aquatic organisms because it readily bio-accumulates,” said Tim Guilfoile, deputy director of Sierra Club’s Water Sentinels Program. “It’s a growing problem for this region.”

This notice-of-intent-to-sue letter follows a similar notice sent to ICG Hazard in early December for selenium pollution from its mine in Leslie County.

Selenium pollution is quickly emerging as a major issue of concern for streams and communities below coal surface mines. Citizen groups have filed several recent enforcement actions against mine operators in West Virginia regarding selenium pollution. In September, a federal judge in West Virginia ordered Patriot Coal Corporation to post $45 million in secured credit to cover the anticipated cost of treating selenium at two of its surface coal mines.

The Appalachian Center for the Economy and the Environment and the Appalachian Citizens Law Center are representing the groups in this case.

“unwarranted burden.”

Attorneys spent two hours before Shepherd presenting arguments about these issues.

Last October, Appalachian Voices, Kentucky Riverkeeper, Waterkeeper Alliance and KFTC threatened to sue – in federal court – International Coal Group and Frasure Creek Mining for an alleged 20,000 violations of the Clean Water Act. But the Kentucky Energy Cabinet stepped in and sued the companies in state court, preempting federal court action.

The Cabinet sued after investigating and documenting more than 2,700 of those alleged violations. But instead of asking the court to help prosecute the companies, they asked the court to accept Consent Judgments, or agreements, they had already negotiated with the companies to settle the matter. The companies are not denying the violations.

Those Consent Judgments are anemic and proof that state officials are not acting in the public interest, Lauren Waterworth argued for the citizens groups.

“We do not think the consent judgment is adequate. There’s no transparency here. They have bypassed any opportunity for public scrutiny. They are asking us to give them the benefit of the doubt.”

She said that additional discovery is needed to understand the full nature of the violations and answer questions about possible fraud by the companies, a claim state officials have ignored.

It was clear that the cabinet and companies were most worried that allowing third-party interveners might result in just such a deeper investigation into the companies’ violations and the Cabinet’s lack of enforcement.

“The coal industry attorneys are desperate that we don’t get to discovery,” observed Doug Doerrfeld.

Shepherd understood that if he approved the Consent Judgments that a federal court likely would interpret that to mean that the case had been diligently prosecuted and dismiss any citizen lawsuit. So he questioned the attorneys about how the citizens’ interest could be represented.

The Canary Project is...

The Canary Project is a way to build a better future – beyond coal – for Kentucky and the nation. The campaign has four goals: force the coal industry to obey the law and enforcement agencies to enforce it, pressure elected leaders to pass laws to protect our mountains, develop a sustainable economy for the coalfields, and support clean energy alternatives to coal.

A focus of the campaign is ending mountaintop removal mining.

Shepherd acknowledged the letters the court has received through a public comment process from a lot of people who believe the Consent Judgments need to be strengthened to ensure future companies comply with the law. But he observed that “the only two parties I have before the court are those who are in agreement. How is the court going to be able to determine if the Cabinet acted appropriately?”

Registration open for Week in Washington, scholarships available

For five years, KFTC members have been building new power and growing a healthy democracy through an annual “Week in Washington.”

During this Alliance for Appalachiaorganized event, citizens from across the country meet with hundreds of federal legislators to discuss legislation that would protect streams from coal mining valley fills.

KFTC is now accepting applications for members who want to attend the 2011 Week in Washington, April 2-7. KFTC and the Alliance have a limited number of scholarships available that include transportation and all trip costs.

If interested in going and to apply for a scholarship, contact Kevin Pentz at Kevin@kftc.org or 606-335-0764.

Applications must be received by February 18, and you will receive a response by February 24. The KFTC Leadership Development Committee will review the applications.

Others wanting to go who do not need a scholarship should register at ilovemountains.org/wiw.

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balancing the scales, February 3, 2011

General Assembly Update

KFTC’s work and issues in the 2011 General Assembly The following pages have updates about KFTC’s legislative priorities. This information was current as of press time (February 3), but is likely different by the time this is received in the mail. You can track the status of any bill in the online version of the Legislative Record – www.lrc.ky.gov/ record/11rs/record.htm – published every legislative day.

KFTC Legislative Priority for 2011

Mountaintop Removal As of press time, the Stream Saver Bill had not yet been introduced. Sen. Kathy Stein will sponsor the bill in the Senate, as she did last year.

In addition to the bills included in this issue, KFTC will take positions for or against other bills, as determined by the Executive Committee during their weekly calls. You can track KFTC’s position and the status of these bills at www. kftc.org. You can also find report-backs from KFTC’s big lobbying days on the blog – www.kftc.org/blog.

KFTC has members and staff at the capitol most Tuesdays, Wednesdays and Thursdays while the legislature is in session. If you would like to lobby with other KFTC members, please contact a chapter organizer or Lisa Abbott at Lisa@ kftc.org or 859-200-5159. KFTC encourages all members to spend at least one day lobbying or attending a rally.

Finally, if you think this work is important, please consider a donation to help it continue. Donate to KFTC online at www.kftc.org/donate, or use the form on page 16 to send in your donation.

I Love Mountains Day 2011 Monday 2.14.11

Join us, bring friends, and wear red!

Parents, please bring your children and grandchildren. Young people, be sure to bring your parents and grandparents!

Make history and stop the assault on the land, water and people of Kentucky!

Support a Clean Energy Future for Kentucky

11 a.m. – Gather at the Kentucky River below the bridge at Capital Ave. 11:30 a.m. – March to the Capitol (flat route is .6 miles) 12:15 p.m. – Rally on the Capitol steps 1 p.m. – Join us in the rotunda to deliver Valentines to Gov. Beshear Learn more, get directions, and register at www.KFTC.org/love or call 606-878-2161

balancing the scales, February 3, 2011

Page 9

General Assembly Update KFTC Legislative Priority for 2011

Clean Energy Clean energy legislation that was crafted with the Kentucky Sustainable Energy Alliance (KySEA) was introduced February 2 by Rep. Mary Lou Marzian.

House Bill 239 – or the Clean Energy Opportunity Act – was assigned to the House Tourism Development and Energy Committee. This was taken as a positive sign – in the past, clean energy bills have gone to the Natural Resources

and Environment Committee, where they received a hostile reception.

The Tourism Development and Energy Committee is chaired by Rep. Leslie Combs, who represents Letcher and part of Pike County.

As of press time, no hearing had been set on the bill.

The KySEA Clean Energy Lobby Day will take place on Thursday, February 10.

ACTION: Call the Legislative Message Line (1-800-372-7181) as soon as you can, and ask to leave a message for all members of the House Tourism Development and Energy Committee. If your own representative is on this committee, please leave a special message for him or her.

Key Components of the Clean Energy Opportunity Act A renewable and efficiency portfolio standard (REPS) requires electric utilities to meet specified energy efficiency and renewable energy goals.

Investor-owned utilities, electric cooperatives and some municipal utilities would be required to participate.

Energy Efficiency Utilities will achieve annual cumulative efficiency savings ramping up to 10.25% of retail sales by 2021 by reducing demand from industrial, commercial and residential customers.* Residential Requirement – Efficiency savings ramping up to 10% of the residential sales portion of the total efficiency standard will be achieved through programs that assist low-income households at or below 200% of federal poverty level ($44,100 for a family of four) by 2021.

Legislators to Contact

Renewable Energy Utilities will ramp up to providing a minimum of 12.5% of retail sales by 2021 from renewable sources – solar energy, geothermal energy, wind energy, low-impact biomass, hydro-power, landfill gas, anaerobic digestion and the renewable portion of co-generation.* A utility that falls short of its annual goal may meet the requirement through energy efficiency savings of 1.25 times the amount of the shortfall.

House Tourism Development and Energy Committee

Solar Requirement – 1% of retail sales will be met through solar energy purchases as a portion of the total renewable standard.

The message line is open from 7 a.m. until 11 p.m. Monday through Thursday, and until 6 p.m. on Friday.

Message: “Please vote YES on House Bill 239.”

Royce Adams Myron Dossett Jim Gooch Melvin Henley Kim King David Osborne Addia Wuchner

Leslie Combs, chair Larry Clark Ted Edmonds Jeff Greer Wade Hurt Martha Jane King John Short Jill York

*Baseline used is a rolling average of retail sales from two previous years

Bob DeWeese Kelly Flood Keith Hall Thomas Kerr Tom McKee Fitz Steele

This House committee usually meets on Thursday at 10 a.m. in Room 131 of the Capitol Annex. This is the committee that will consider Rep. Mary Lou Marzian’s clean energy bill (HB 239).

Use the toll-free Legislative Message Line (800-372-7181) to leave a message for any legislator. Use 502-564-8100 to talk to a legislator directly.

Need extra copies of KFTC’s Citizens Legislative Guide?

Contact the KFTC London office at: 606-878-2161 or info@kftc.org

Feed-in tariffs (FITs) are set rates that utilities pay when purchasing renewable energy produced in Kentucky. FITs will accelerate the development of large and small-scale renewable energy projects.

Under the bill, FITs will be established by the Kentucky Public Service Commission (PSC) to equal the cost of renewable electricity production plus a reasonable rate of return. This means renewable energy project developers would be assured in advance that Kentucky utility companies would purchase their power at these set rates. As production costs decrease over time, FITs rates will similarly decline.

Utilities may adjust charges to account for the energy cost increase and may count all eligible purchases towards their REPS goal.

Download a copy of this bill at www.lrc.ky.gov/record/11rs/HB239.htm “Energy is a farming family’s largest input cost. Energy efficiency and renewable energy turn a farm liability into a profitable asset!”

Adam Barr Barr Farms, Meade County

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balancing the scales, February 3, 2011

General Assembly Update SB 6: Immigration KFTC members see need for comprehensive reform, SB 6 takes a different approach

Faith-based, labor, immigrant, social service, social justice, legal, human rights and many other organizations have been gathering around the state to strategize for the defeat of Senate Bill 6.

SB 6 is Senate President David Williams’ anti-immigrant bill. It is modeled after parts of Arizona’s anti-immigrant law that has sparked a national controversy, widespread condemnation and a boycott of Arizona by many groups.

Parts of that law were found unconstitutional.

More than 100 people attended one such meeting on January 8 at the Americana Center in Louisville. A larger crowd gathered there two weeks later.

The large turnout “speaks to the breadth of opposition to this legislation,” said immigration lawyer Ron Russell. “This room is a powerful room,” added Carla Wallace.

Similar meetings have taken place in Frankfort, Lexington, Bowling Green, Scott County and other cities.

KFTC members have been well-represented at all these meetings.

The economic impact such a law

would have for tourism and other business, increased prison and law enforcement costs, and defending the law in court were among the reasons many said the law would be bad for Kentucky.

The Legislative Research Commission found that the fiscal impact of SB 6 is “indeterminable,” but for illustrative purposes found a cost impact of $40 million. This does not include costs to local law enforcement agencies, which could be considerable.

But it was mostly for anti-racist and human rights reasons that folks wanted to see the legislation defeated.

The KFTC Steering Committee voted on January 29 to oppose the bill and to support efforts toward its defeat.

“What needs to be fixed is the whole immigration system,” pointed out Mary Love. “This is not the way to fix the immigration problem.”

Scott County KFTC member Homer White expressed a similar view at the first Louisville meeting. He said he hoped people would “use this moment to help create a different climate in the state … to make Kentuckians more welcoming and support comprehensive immigration reform.”

But the shortterm goal is the defeat of SB 6.

The bill was rushed through the Kentucky Senate in early January, during the General Assembly’s organization session. It is assigned to the House Local Government Committee, with committee hearings Many KFTC members and Allies attended the February 2 scheduled for Febhearing on Senate Bill 6. ruary 2 and 9.

Senate Bill 6 would … * Require police to attempt to determine a person’s immigration status if a “reasonable suspicion” exists that they may be an undocumented immigrant. * Allow someone to be arrested without a warrant if an officer has probable cause to believe he or she has committed an offense that would lead to deportation. * Ban local communities from enacting laws that would limit enforcement of federal immigration laws. * Permit government agencies – such as those that provide public benefits or issue licenses – to exchange information related to an individual’s immigration status. * Make smuggling undocumented immigrants into the state for money a felony. * Apply trespassing law to undocumented immigrants on public or private land. * Create a misdemeanor offense of “assisting an illegal alien” for anyone who helps transport such individuals into the state, disregards their presence, conceals or harbors them or encourages them to come to the state. * Require an arresting officer to seize any vehicle used to transport undocumented immigrants.

At the first hearing, bill sponsor Senator John Schickel argued for SB 6. Committee chair Steve Riggs and other committee members sparred with Schickel, but the line of argument was overwhelmingly focused on the claim that SB 6 would be expensive to implement and constitutes an unfunded mandate to local governments. No one questioned the premise that “illegals” were bad and needed to be dealt with.

Democrats suggested instead that House Bill 3 would be a better way to address the immigration issue. HB 3 penalizes employers who hire “unauthor-

ized aliens.” HB 3 is on its way to the full House after passing the Labor and Industry Committee on February 4.

People who testified against SB 6 included the head of the jailers’ association, the magistrates and county officials association, and Head Start.

ACTION: Call the Legislative Message Line at 1-800-372-7181 and leave a message for “House Leadership” and the “House Local Government Committee.” If your state representative is on the Local Government Committee, please contact them more directly, too.

Legislators to Contact House Local Government Committee Julie Adams Ted Edmonds Adam Koenig Michael Meredith Kevin Sinnette Jim Wayne

Steve Riggs, chair Ron Crimm Richard Henderson Stan Lee David Osborne Rita Smart

Mike Denham Brent Housman Tom McKee Arnold Simpson Ben Waide

This House committee usually meets on Wednesday at 12 noon in Room 131 of the Capitol Annex. There was a hearing on SB 6 before this committee on February 2, with a second hearing scheduled for February 9.

Use the toll-free Legislative Message Line (800-372-7181) to leave a message for any legislator. Use 502-564-8100 to talk to a legislator directly.

balancing the scales, February 3, 2011

Page 11

General Assembly Update KFTC Legislative Priority for 2011

Voting Rights With the 2011 legislative session underway, the campaign to pass House Bill 70 – a bill that would restore voting rights to most former felons after they’ve served their debt to society – has been stepped up.

That legislation passed through the House each of the last four years, with strong bi-partisan support. But HB 70 was stopped in the Senate each year when that chamber’s leaders, Senator Damon Thayer and Senator David Williams, refused to allow the bill to come up for discussion or a vote.

The short-term goal is to talk to all of the new legislators about this issue and to build on the already broad support in both the Senate and the House.

Supporters are hoping for a quick hearing on HB 70 in the House Elections and Constitutional Amendments Committee, where the bill won support in past years, and then quick passage by the full House. House passage early in the short session will allow more time to put pressure on Senate leaders to allow the bill to be heard.

ACTION: Call the Legislative Message Line (1-800-372-7181) as soon as you can, and ask to leave a message for “House and Senate Leadership, Senate State and Local Government,” and your own representative and senator.

The line is open until 11 p.m. Monday through Thursday, and until 6 p.m. on Friday.

Message: “Please vote YES on House Bill 70.”

Legislators to Contact House Elections, Constitutional Amendments and Intergovernmental Affairs Committee Kevin Bratcher Joseph Fischer Melvin Henley

Darryl Owens, chair Larry Clark Derrick Graham Mary Lou Marzian

James Comer Mike Harmon John Will Stacy

This House committee usually meets on Tuesday at 8 a.m. in Room 171 of the Capitol Annex. It is where HB 70 starts.

Senate State & Local Government Committee Walter Blevins Alice Forgy Kerr R.J. Palmer Johnny Ray Turner

Damon Thayer, chair Jimmy Higdon Gerald Neal Dan Seum

Tom Jensen John Schickel Robert Stivers

This Senate committee usually meets on Wednesday at 12 noon in Room 154 of the Capitol Annex. It is where HB 70 has gone (and has died) in past sessions after it passes the House.

Use the toll-free Legislative Message Line (800-372-7181) to leave a message for any legislator. Use 502-564-8100 to talk to a legislator directly.

Voting Rights Lobby Day Thursday, February 24 State Capitol, Frankfort

(or from wherever you are) In Frankfort Learn – meet in Capitol Annex Room 125 for lobby training from 8 to 10 a.m. (come to the cafeteria downstairs if you need a lobbying orientation after that) Lobby – visit with legislators after your orientation until …

Rally – in the Capitol Rotunda from 1 to 2 p.m. – with former felon speakers, singing, and more At Home But if you can’t make it out to Frankfort, you can contact your legislators through email or the legislative message line, or write letters to the editor. Watch for a local event in your area, or contact Dave Newton (Dave@kftc.org or 859-420-8919) if you want to host one.

Stay in touch with the General Assembly MESSAGE LINE.............................. 1-800-372-7181 BILL STATUS LINE ........................ 1-866-840-2835 CALENDAR LINE ......................... 1-800-633-9650 TTY MESSAGE LINE .................... 1-800-896-0305 EN ESPANOL................................. 1-866-840-6574 LEGISLATOR FAX LINE .............. 1-502-564-6543

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balancing the scales, February 3, 2011

General Assembly Update

Members don’t see good solutions from tax commission KFTC Legislative Priority for 2011

Tax Reform

KFTC members have long lobbied legislators to pass good solutions to strengthen communities through tax reform. Now, they’ll also be talking with legislators about the process of determining those reforms.

KFTC members are learning about a bill from Senate President David Williams, Senate Bill 1. The bill creates a panel of experts to study and make recommendations for state tax reform. The panel would present its findings to the legislature for an up-or-down vote — no amendments, no changes.

The panel would consist of five economists who work at Kentucky colleges or universities, two accountants, a Property Valuation Administrator and a tax lawyer. They would present recommendations to the 2012 legislature for an up-or-down vote, meaning that legislators would not have the opportunity to make any changes or amendments.

Williams’ bill would allow a very limited amount of public comment, from a specific cross-section of the public. SB 1 lists seven entities: the Kentucky Association of Counties, the Kentucky Association of Manufacturers, the Kentucky Chamber of Commerce, the Kentucky Farm Bureau, the Kentucky League of Cities, the Kentucky Retail Federation, and the National Federation of Independent Business.

No mention is made about hearing the views of teachers, farmers, retired people, workers, unemployed or most of the people who pay state taxes.

KFTC members have noticed the absence of transparency, accountability and community in SB 1.

“If they are going to put together a panel it should be balanced with a range of perspectives on the kinds of economic actions that are needed to create a fair and sustainable tax system, and any such

Legislators to Contact House Appropriations & Revenue Committee Royce Adams John Carney Ron Crimm Kelly Flood Keith Hall Reginald Meeks Sannie Overly Sal Santoro Tommy Turner Susan Westrom

Rick Rand, chair John Arnold James Comer Mike Denham Danny Ford Richard Henderson Lonnie Napier Marie Rader Arnold Simpson Jim Wayne Alecia Webb-Edgington

Dwight Butler Jesse Crenshaw Bob DeWeese Derrick Graham Jimmie Lee Fred Nesler Jody Richards Jim Stewart Brent Yonts

This House committee usually meets on Tuesday at 10 a.m. in Room 154 of the Capitol Annex. This is the committee that will consider Rep. Jim Wayne’s tax reform bill (HB 318), and likely the committee that will consider Sen. David Williams’ tax commission proposal (SB 1).

Use the toll-free Legislative Message Line (800-372-7181) to leave a message for any legislator. Use 502-564-8100 to talk to a legislator directly.

panel should include regular Kentuckians as well as economists,” said Mimi Pickering, a Letcher County member.

SB 1 was one of the bills that Williams pushed through the Senate during the legislature’s organizational meeting in January. Sen. Ray Jones (Pike County) was the only Democrat to join all Republicans in voting for the bill.

SB 1 will be considered by the House Appropriations and Revenue Committee.

During the tax justice lobby day on February 3 with KFTC and the Kentucky Forward Coalition, concerns were expressed to many committee members.

They were asked to amend the bill to allow broad public participation and fo-

cus on a tax system that allows Kentuckians to build the kind of state they want.

Williams’ focus is to make Kentucky a “low-taxed state,” without regard for the implications for moving Kentucky forward.

They also asked for transparency and accountability, and a healthy public debate.

“It is important that the elected members of the House and Senate have an opportunity to debate and amend any bills, including tax reform, before voting on them,” Pickering added.

“They are the peoples’ representatives who we have elected in a democratic process to make these decisions. We have not elected legislative panels.”

Reform provisions expanded in Rep. Wayne’s tax legislation

Individual income tax rates would be lowered for most Kentuckians and income tax deductions eliminated in tax reform legislation filed by Rep. Jim Wayne.

HB 318 changes and expands proposals put forth in previous sessions by Rep. Wayne, the General Assembly’s top promoter of progressive tax reform.

It keeps important provisions endorsed by KFTC and the Kentucky Forward Coalition, including a 15 percent Earned Income Tax Credit (EITC), restoration of the Kentucky estate tax to 2003 levels and expansion of the sales tax to selected services.

It also would eliminate the exclusion of private pension income for higher income individuals, raise tobacco taxes (up to $1.09 per pack of cigarettes), and make the film tax credit non-refundable.

Though the bill would eliminate many popular deductions, such as ones for home mortgage interest, charitable deductions, property taxes and others, people at most income levels would pay the same or less in state income tax because their rate would be lower (see table below).

Regarding private pension income, currently the first $41,110 of income from private pensions and IRAs is excluded from the income tax. In Wayne’s bill, this exclusion would be reduced by $1 for each $1 that income from other sources exceeds $41,110, such that an individual with income from other sources of $82,220 would have no exclusion.

The sales tax would be expanded to armored car services, private golf club fees, landscaping services, limousine services, exterminating and pest control services, security services, janitorial services, commercial linen services, and others.

KFTC members hope the bill will be the focus of serious discussions about tax reform in the current legislative session. No significant tax legislation is expected to pass this year.

Proposed changes to income tax brackets and rates in HB 318.

balancing the scales, February 3, 2011

Page 13

Economic Justice Update

Tax reform should start with questions about community

The Kentucky Forward Coalition developed the following to raise important questions that should drive efforts to reform Kentucky’s tax structure. This appeared as an op-ed in the Lexington Herald-Leader, The Winchester Sun, The Courier-Journal and elsewhere.

Many Kentuckians share a frustration with the lack of legislative will to pass real tax reform, resulting in a decade of annual revenue shortfalls, cuts in essential programs, one-time stop gap measures and a failure to make investments that will move Kentucky forward.

As members of the Kentucky Forward Coalition, we share impatience with yet another study, especially if we’re not at all clear that the study will be transparent or guided by Kentuckians’ values. Our Coalition represents Kentuckians from all over the state — from all kinds of backgrounds, occupations, and incomes — who know that Kentucky deserves better.

We propose that any revision of our tax structure — whether coming from the commission that Sen. Williams has called for or another — begins by establishing a set of principles that we can all get behind that benefit all Kentuckians and move us forward. The Kentucky Forward Coalition serves or represents a sizeable portion of the people in our Commonwealth, and these are the principles that we lift up as necessary to create a better Kentucky: • Revenue solutions should sustain a good quality of life in Kentucky through essential investments in good schools, health care, public safety, and other necessary public structures and services.

• Taxes should be balanced, reasonable and fair, with fiscal responsibilities shared equitably among all citizens and businesses by minimizing taxes on low-income people and bringing more balance to our tax code.

• Our tax structure should be sustainable, with reliably constant sources of revenue that grow along with the economy.

We believe that if we use these principles to guide reforms to our tax structure, we will all be in a better position to live up to our potential. Kentuckians are smart, resourceful, helpful, and creative.

We’d all realize our own potential more often by adequately funding the necessary elements of strong communities — good schools with smaller classes, access to quality health care, police and fire departments that have the resources to protect and serve, and water that we know is safe to drink.

A lot of ideas get put under the banner of tax reform. Not all those ideas adhere to principles that reflect our values. Some would allow us to share in our responsibilities equitably and fairly, while others would knock our tax system further out of balance by shifting responsibility away from wealthy individuals and major corporations and onto working families. Some make it easier to pay for the public investments we need to grow and improve the quality of our lives, while others intend to shrink those necessities and turn Kentucky into a place of greater inequality.

Shifting to a tax system based on sales instead of income would turn our already out-of-balance tax system completely upside down, shifting more responsibility to people who are less able to pay, and whose wages and income have stagnated over the years. This shift would not benefit our economy, and would be harmful to our families.

That’s not what Kentuckians deserve.

A sustainable tax structure means a broad base of taxes. That’s because

different taxes respond differently to economic changes, and a broad-based tax system helps maintain and grow the revenues needed. Eliminating individual and corporate income taxes radically narrows our tax base, impacting revenue sustainability over time. That, unfortunately, is the goal of some.

Reform is not just making something different, but something better. Better for Kentucky means generating revenue to help create the kind of society Kentuckians deserve and want, modernizing our

taxes, and bringing balance and fairness to our flawed system.

Every Kentuckian has a stake in our taxes and budget, so we deserve to be represented when recommendations are agreed upon. Any study of reform should invite everyone into the conversation by starting with the question: What kind of communities do we want, and how should we pay for them? The answers to those questions are defined not by experts, but by our values. Kentucky is worth our doing this right.

Kentucky loses billions from special tax breaks

Kentucky loses billions of dollars in revenue each year through special tax breaks and preferences. Yet lawmakers and state officials do little to understand the effectiveness of these provisions.

“Special tax breaks and preferences result in billions of dollars in lost revenue at a time when Kentucky struggles to protect investments in key public necessities,” said Jason Bailey, director of the Kentucky Center for Economic Policy. “Yet these holes in the tax code receive far less scrutiny than spending in the state budget.

“Kentucky has made painful budget cuts the last couple of years, but has done little to more closely scrutinize its tax expenditures.”

These findings were documented in a new report titled Reforms Needed to

Bring Greater Scrutiny to Tax Expenditures.

It can be accessed at www.kypolicy.org.

Kentucky’s budget office identifies tax expenditures and estimates the lost revenue every two years. Its most recent report contains 287 tax expenditures.

Significant ones include those related to businesses and economic development, the exclusion of services from the sales tax and other sales tax exemptions, various income tax deductions and the state’s limitation on the property tax.

The state lacks the systems to understand the purpose of many tax expenditures, assess their effectiveness and make regular and informed decisions about whether individual tax expenditures are worth the lost revenue.

“We need to put tax expenditures on a more even playing field with the

public necessities and investments that tax dollars pay for,” said Bailey. “The commonsense reforms included in this report will move us in the right direction and help us make better choices about our fiscal and economic future.”

Recommendations include identifying who benefits from particular tax expenditures; creating a tax expenditure review committee to regularly assess the effectiveness of tax expenditures; requiring many tax expenditures to expire at least once a decade; and creating cost caps on some tax expenditures.

The Kentucky Center for Economic Policy (KCEP) conducts research, analysis and education on important state fiscal and economic policy issues. Visit KCEP’s website at www.kypolicy.org.

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balancing the scales, February 3, 2011

Economic Justice Update

State of the Dream report shows how treatment of workers, tax policies affect racial economic divide

Policies that erode opportunities for public sector workers and oppose progressive taxes widen the racial economic divide because they disproportionately harm Blacks and Latinos, according to a new report by KFTC ally United for a Fair Economy.

“Austerity measures will ratchet down the standard of living for all Americans, while simultaneously widening our nation’s racial and economic divide,” said Brian Miller, executive director of United for a Fair Economy and co-author of State of the Dream 2011: Austerity for Whom?

State of the Dream 2011 documents how conservative economic policies increase economic inequality and deepen the racial divide. Forty-two years after Martin Luther King’s death, Blacks are paid only 57 cents and Latinos 59 cents to each dollar Whites are paid.

The tax cuts advocated by conservatives will worsen this divide by flowing disproportionately to wealthy White households, while the proposed cuts to social safety nets and the public sector work force will disproportionately harm African-Americans and Latinos.

Notable findings of the report are: • Tax Cuts: Whites are three times as likely as Blacks, and 4.6 times as likely as Latinos, to benefit from income tax cuts for those earning over $250,000.

• Public Sector Jobs: Blacks are 1.3 times as likely to work in a state government job than the general workforce, and 1.7 times as likely to work for the federal government in particular. Blacks and Latinos are more likely to achieve professional parity there due to civil rights protections unique to the public sector.

• Job Creation: With an official unemployment rate of 15.8% for Blacks, 13% for Latinos, and 8.5% for Whites, cutting public spending and direct job creation programs disproportionately hurts Blacks and Latinos, and the entire economy.

• Social Safety Net: Financial cushions allow families to survive un- and under- employment; Blacks hold only 10

cents of net wealth, and Latinos hold 12 cents of net wealth, for every dollar that Whites hold, making unemployment insurance, Social Security and public assistance vital to the economic well being of these groups. Among retirement age adults, for example, 60% of Blacks and 65% of Latinos depend on Social Security for more than 80% percent of their income, compared to only 46% of Whites.

The report calls for more protection of government employees, who perform valuable functions for society, and additional federal aid to the states.

Kentucky received $1.6 billion in stimulus funds through the American Recovery and Reinvestment Act in 2009, which saved or created 12,825 jobs. Similar job-saving stimulus from the federal government, combined with state-level progressive tax reform, will help Kentucky address its racial wealth disparities.

KFTC members are working in a variety of ways for a reversal of laws and policies that reinforce racial divides and in support of those that work for all people.

K. A. Owens, a Jefferson County member and former KFTC chairperson, works to protect and strengthen the public sector, and make its elected leaders more accountable to people. His perspective is informed many years of this work, and by his own family’s history.

“Union jobs, civil service jobs, jobs that provide stable incomes and job security enable African Americans and others to achieve some level of comfort, and even a feeling of prosperity,” said Owens. “These jobs benefit everyone in our society because these job holders have a secure stream of income that they are able to spend on homes, cars and appliances over a 30-year career and provide a secure retirement. I saw my parents and their friends live the American dream in exactly that way.”

“We all care deeply about the next generation and we all know there are no valid reasons for any of the elements that have led to stable incomes and job security for African Americans and others in the past to disappear. The only

“Kentucky is rich in so many amazquestion is how we will fight effectively to preserve these elements and hand ing resources, and the people of Kenthem down to the next generation,” Owtucky are intimately intertwined with ens said. them and with each other. We work to

Linda Stettenbenz, a member of hold legislators of all stripes accountKFTC’s Economic Justice Committee able, and demand they push forward who helps organize in Louisville for tax programs and policies that will benefit reform and job creation, hopes that the all of us.” report invites more people to become involved in creating economic policy.

“In Kentucky we can further the work of Dr. MAIN OFFICE King by lifting up the Morgan Brown, Robin Daugherty necessary programs and & Burt Lauderdale policies that help peoP.O. Box 1450 ple, and by criticizing London, Kentucky 40743 those that hinder us,” 606-878-2161 Stettenbenz said. “Right Fax: 606-878-5714 now, Kentucky has one info@kftc.org of the fastest growing wealth gaps between rich FIELD OFFICES and poor in the nation.

We also have among the Louisville Berea highest unemployment Jessica George, Teri Blanton and poverty rates, and Jerry Hardt, 118 Baugh Street minorities are affected Colette Henderson Berea, Ky. 40403 disproportionately.” and Nancy Reinhart 859-986-1648

Data shows that Ken901 Franklin Street tucky’s unemployment Louisville, Ky 40206 Central Kentucky rate for African-Ameri502-589-3188 cans was 16.5 percent, Tim Buckingham, while the rate for whites Jessica Hays Lucas, Whitesburg was 10.1 percent, and for Erik Hungerbuhler, Latinos 9.6 percent.

Willa Johnson, Brittany Hunsaker,

“This is all the result Tanya Turner, and Heather Roe Mahoney, of decades of legislative Colleen Unroe Dave Newton, John neglect of the needs of P.O. Box 463 Malloy and ordinary people in the Whitesburg, Ky 41858 Ondine Quinn state,” Stettenbenz ex606-632-0051 250 Plaza Drive Suite 4 plained.

Lexington, Ky 40503

“But most imporBerea 859-276-0563 tantly, we can further his Lisa Abbott, Amy Hogg, work here by creating Northern Kentucky Carissa Lenfert, a place for the voices of Sara Pennington Joe Gallenstein ordinary citizens to be and Kevin Pentz 859-380-6103 heard and respected. This 140 Mini Mall Drive is why I value KFTC’s Berea, KY 40403 Floyd County work toward a vision 859-986-1277 that will move us all Brittany Combs forward into a more just 606-422-0100 and sustainable economy e-mail any staff member at firstname@kftc.org except for that values the prosperJessica Hays Lucas use jessicabreen@kftc.org and ity of ordinary people,” Brittany Hunsaker use brittanyh@kftc.org Stettenbenz said.

KFTC Offices and Staff

balancing the scales, February 3, 2011

Steering Committee sets 2011 program of work, staffing

KFTC Steering Committee members met January 29 in Berea. They approved the 2011 Program of Work, discussed priorities for the 2011 General Assembly and reviewed a bridge staff structure.

2011 Program of Work

Building on one of KFTC’s most productive and eventful years ever, the 2011 Program of Work sustains the momentum and pivots to new elements that move the work forward.

The Program of Work includes plans for all of KFTC’s major strategies: leadership development, communications, grassroots fundraising and membership recruitment, voter empowerment, and building strong chapters.

In the area of leadership development, a major focus in 2011 will be the New Power Leader program. Grassroots leaders across the state will lead “clusters” of members in their communities, talking with them regularly about KFTC issues and encouraging them to vote and to support KFTC.

The Steering Committee also affirmed the importance of our grassroots fundraising and membership recruitment and renewal work.

“We have to work on grassroots fundraising because funders have specific formulas for who they’ll fund and KFTC may not always fit in with those formulas,” noted Dana Beasley Brown of Bowling Green. “KFTC is who we are and this is why grassroots fundraising is so important.”

The Program of Work also sets goals and next steps for KFTC’s six campaigns.

One campaign discussed was Renew East Kentucky. It is the next step in the successful Stop Smith campaign, in which KFTC helped stop a new coalburning power plant in Central Kentucky.

Renew East Kentucky focuses on shifting rural electric cooperatives to a culture of energy efficiency and renewable energy, and is part of a New Energy and Transition initiative that also includes KFTC’s work around sustainable energy policy and economic transition in Appalachia.

The Program of Work also includes goals for the Canary Project work to end mountaintop removal, tax reform plan and the campaign to restore voting rights to former felons, as well as work in local chapters.

In discussing the Canary Project, the Steering Committee noted the tremendous work in 2010 around the

enforcement of mining laws, for which KFTC members met with federal agency officials nearly 20 times. They expressed hope that in 2011, the U.S. Environmental Protection Agency (EPA) would take a strong stance on controlling mountaintop removal in Kentucky, as it has in West Virginia, where the EPA stopped a major mountaintop removal operation.

“I want to see something in Kentucky,” said Floyd County member Rick Handshoe, who met with federal officials several times last year.

“We are approaching a crest,” noted Erika Skaggs of Central Kentucky. “We have to keep pushing forward while we have momentum.”

They also reviewed KFTC’s extensive voter empowerment work in 2010, which included contacting thousands of voters around the elections, launching the New Power PAC, and conducting a media campaign.

The New Power PAC was meant to take a more assertive and visible role in elections, and the Steering Committee is interested in exploring how the New Power PAC might be involved in the 2011 elections as well.

Members also were excited about the clean energy conference scheduled for January 31 and the Growing Appalachia conference, which focuses on economic transition in Appalachia, set for April 9 in Prestonsburg.

Mary Love of Jefferson County noted that public sentiment is growing for clean energy solutions. “I think the time is now,” she said.

“We’ve got to get the state behind us,” said Rosanne Fitts Klarer of Scott County, noting that Ohio and Tennessee have better incentives than Kentucky for renewable energy ventures.

kind of communities we want and that our tax dollars can support.

“Maybe this is the start of a better year,” said Handshoe.

“My hope for the legislature this year is I hope we make a scene,” said Bev May, also of Floyd County. Both Handshoe and May have been deeply involved in KFTC’s work around coal issues in Eastern Kentucky.

The Steering Committee approved four recommendations from KFTC’s Economic Justice Committee related to pending legislation: o For KFTC to join the Coalition for Responsible Lending (KFTC has not taken a position on a pending payday lending bill, but various KFTC members and chapters are working on responsible lending issues). o To support the Kentucky Forward tax bill. o To oppose House Bill 208, which would require recipients of public assistance to undergo drug testing.

The Steering Committee asked that the Economic Justice Committee craft messaging that reflects KFTC’s position that this bill is not the way to address the drug problem. o To oppose Senate Bill 6, an immigration bill similar to the controversial Arizona immigration law.

Some members expressed a desire to solidify KFTC’s position on immigration, in light of recent anti-immigrant

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bills in the General Assembly.

Alex Searles of KFTC’s Northern Kentucky chapter said members of her chapter are excited to have at-home meetings with their legislators about the range of issues KFTC is working on.

“It’s just really exciting to watch people get involved and to be a part of that,” Searles said.

K.A. Owens of Jefferson County reminded folks of the importance of the General Assembly. He noted, “The General Assembly is an opportunity for KFTC leaders to share our point of view with the world and try to change things.

We try to explain, in hopefully effective ways, how things could be better.”

Staff Team Bridge

Staff and leaders have been discussing how to strengthen the KFTC staff team. The Steering Committee approved a new “bridge” staff structure for 2011 that will help KFTC focus on key strategies such as leadership development, chapter development, voter empowerment and the new energy work.

KFTC’s membership and staff have grown rapidly in the past few years, and the staff structure hasn’t kept pace. The bridge structure attempts to address that and align the staff team more with the Program of Work.

Most staff roles will not change dramatically, but the bridge structure builds in support systems that will help develop staff capacity and skills.

2011 General Assembly

Steering Committee members expressed both optimism and low expectations for the 2011 Kentucky General Assembly.

I Love Mountains Day and the clean energy bill backed by the Kentucky Sustainable Energy Alliance (of which KFTC is a founding member) were lifted up as high points for this year’s session.

Also big will be pushing for passage of House Bill 70, which would allow for a constitutional amendment on giving former felons their voting rights back after they’ve served their debt to society.

And, though it’s not a budget year, KFTC will help to inform the conversation around tax and budget issues and the

Alex Searles, representing the Northern Kentucky chapter on the KFTC Steering Committee, shared her thoughts on KFTC”s Program of Work. Listening are Mary Love (Jefferson County) and Stanley Sturgill (Harlan County).

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balancing the scales, February 3, 2011

Calendar of Events Feb. 9

A week of Lexington Loves Mountains activities begins; see poster to the left

Feb. 10

Public hearing on new rules to protect miners from black lung disease, 9 a.m. at Jenny Wiley State Park near Prestonsburg; sponsored by the U.S. Mine Safety & Health Administration

Feb. 10

KySEA lobby day for clean energy

Feb. 12 -13

Music for the Mountains 2011 – CD Release Party, 21 musical acts over 2 days; Southgate House (24 East 3rd Street) in Newport

Feb. 14

I Love Mountains Day – see page 8

Feb. 15

Perry County chapter meeting, in Hazard; contact Colleen Unroe for more information, Colleen@kftc.org or 606-632-0051

Feb. 17

Rowan County chapter meeting, 6 p.m. at St. Alban’s Episcopal Church on 5th Street in Morehead

Feb. 17

Central Kentucky chapter meeting, 7 p.m. at the Episcopal Diocese Mission House (on the corner of Martin Luther King Blvd. and 4th Street) in Lexington

Feb. 22

Move Kentucky Forward Day at the General Assembly – lobby for investing in Kentucky’s children and future

Feb. 22

Bowling Green and Friends chapter meeting, 6:30 p.m. at the Unitarian Universalist Church (2033 Nashville Road) in Bowling Green

Feb. 23

Fairness Rally and Lobby Day at the General Assembly, 9 a.m. – 2 p.m.; more information from Laura@Fairness.org or 502-893-0788

Feb. 24

Voting Rights Lobby Day at the General Assembly – see page 11

Feb. 28

Madison County chapter meeting with special presentation from Kentucky Heartwood, 7 p.m. at Child Development Lab on Jefferson St., in Berea

March 3 Harlan County chapter meeting, 6 p.m. in Room 219 of Southeast Community College’s Appalachian Center in Cumberland

I want to help KFTC build power!

Name: Address: City, State Zip:

Phone: Email: I wish to make my donation to the following organization (check one): ____ KFTC (not tax-deductible) ____ Kentucky Coalition (tax-deductible) Suggested membership dues are $15-$50 annually. ____ One-time Gift: Amount $_____________ ____ Pledger: I will contribute $___ every (check one):

__ Month __ 3 Months __Quarterly __Annually

March 3 Scott County chapter meeting, 7 p.m., at the Georgetown Public Library March 5 Wild & Scenic Film Festival, 7 p.m. at the Clifton Center in Louisville; more information from the Kentucky Waterways Alliance (www.kyalliance.org) March 14 Floyd County chapter meeting, 7 p.m. at St. Martha Catholic Church near Prestonsburg March 15 Perry County chapter meeting, in Hazard; contact Colleen Unroe for more information, Colleen@kftc.org or 606-632-0051 April 1-4 PowerShift in Washington, D.C.; info at: energyactioncoalition.org April 2-7 Week in Washington with the Alliance for Appalachia April 9

Growing Appalachia conference in Prestonsburg