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Friday, April 9, 2004

Fletcher pleads for tax plan


Call legislators, governor urges

By Charles Wolfe
The Associated Press

FRANKFORT - Gov. Ernie Fletcher, intent on salvaging his tax plan and getting a budget to his liking, tried a direct appeal to the public Thursday.

Fletcher used 11 minutes of television time to urge viewers to ring up the General Assembly and demand approval of a new tax code that he insists is the key to future economic growth.

"This is a critical time for the future of our state," Fletcher said in a speech delivered from his office in the Capitol and offered free via satellite to commercial stations.

Two days remain in the 2004 legislative session. The General Assembly went into an extended recess March 30. The session was scheduled to be wrapped up Monday and Tuesday - time set aside to deal with Fletcher's vetoes.

The Kentucky Constitution sets a deadline of April 15. But it also imposes a limit of 60 legislative days. Monday would be Day 59, and much legislation remains pending, most notably the state budget.

Conferees from the Republican-controlled Senate and Democratic-controlled House arrived Wednesday to begin talks that ended up going nowhere.

The chief obstacle was the Senate's insistence - and the House's refusal - to deal with the tax code as part of the budget. Fletcher, a Republican, used his TV time to blame his opposition.

"With only two legislative days left, House Democrat leadership has prevented us from adopting a budget or a tax program," he told viewers.

He said he wanted viewers to "understand what is at stake." He said he was "particularly concerned" that there could be an attempt to settle for "half a fix" to the tax code. "There may also be efforts to abandon the work we've started and leave here without a budget," Fletcher said.

In one of a series of Democratic rebuttals, House Speaker Jody Richards of Bowling Green said voters want a budget.

"I haven't had anybody saying to me, 'Don't come home without a tax modernization plan,'" Richards said, using Fletcher's term for his tax proposal - a combination of tax cuts and tax increases that Fletcher says would be "revenue neutral" at the beginning.

Democrats contend that the plan, even with lower income tax rates across the board, would amount to a tax increase on most individuals for the sake of tax breaks to corporations. Fletcher would balance cuts with new taxes or increased taxes on tobacco, alcohol and telecommunications services, including satellite TV.

If the budget process collapses entirely, Richards said Democrats would "tell the people we saved them from $725 million in taxes on the backs of working people."

Fletcher insists that the state needs a new tax code because of court rulings that struck down some taxes on communication companies and on companies headquartered in other states.

He also said the current tax system is unreliable, evidenced by four straight years in which revenues fell short of what was needed for budgeted spending.




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