Governor Ernie Fletcher's tax modernization plan that he traveled all over the state (including Hazard) to promote is already seeing side effects even though it has yet to come into effect.
The City of Hazard's recent tax proposal concerning telecommunications is a sad necessity that only came about due to Fletcher's new plan. If the new city tax passes, which it has yet to do, it will signal the first ill effect that the modernization plan has on small towns. Without this tax, Hazard could stand to lose money and have to raise taxes elsewhere.
Fletcher hailed his tax modernization plan as a plan that would not raise taxes and formulate new opportunities for economical development in Kentucky by way of offering incentives to businesses to operate in the Commonwealth.
The governor kept true to his word and his did not raise taxes, at least not directly by his plan. In effect, what his plan has accomplished is to cause city's and counties to raise or create taxes of their own so that the state can generate more revenue for itself - revenue that would have went to the cities and counties. Fletcher comes out and can say that he didn't raise taxes and the local governments look like the bad guys because they stand to lose money with the governor's plan.
And what will this extra revenue the state is gong to generate go to?
Well, Fletcher traveled to the recent NCAA basketball tournament in March in the state's dime to watch Kentucky and Louisville play in their respective games. Perhaps our tax dollars will now be used to send him to more sporting events, or perhaps another visit to Los Angeles to appear on The Tonight Show.
Since Fletcher came to office he has reformed everything that was previously put into place, from tax plans to the state logo. I have no doubts that he wants to do well, why would any politician want to do a bad job, but the fact is that with his tax modernization plan he has already caused detriment to local governments. When law makers on the local level have to make up revenue that the state has taken away in the form of a haphazard tax plan, something has gone wrong. The City of Hazard should not have to create a new tax in order to keep from losing money. The Commonwealth of Kentucky should be looking out for the cities and the counties, not the other way around.