COAL COALITION SPEECH
JULY 11, 1996


THANK YOU!!!

I REALLY APPRECIATE THE OPPORTUNITY TO SPEAK AS GOVERNOR TO A GROUP THAT I FEEL SO MUCH A PART OF AND TO SO MANY OF THE PEOPLE THAT HELPED ME GET TO WHERE I AM.

I CAN'T SAY THAT I WAS A FOUNDER OF THIS GROUP BECAUSE I WASN'T IN OFFICE WHEN YOU FIRST BEGAN YOUR WORK, BUT I CAN SAY I'VE BEEN A SUPPORTER OF THE COAL COALITION SINCE ITS FOUNDING AND A SUPPORTER OF YOUR CAUSE SINCE 1972, THE YEAR THE COAL SEVERANCE TAX WAS ENACTED.

FEW HERE EXCEPT KEN HART AND NIM HENSON HAVE BEEN INVOLVED AS LONG AS I, AND MANY OF YOU MAY NOT KNOW THE TRIALS AND TRIBULATIONS WE HAVE GONE THROUGH TO GET WHERE WE ARE.

I WANT TO TAKE THE OPPORTUNITY TO REVIEW THE REASON THIS ORGANIZATION WAS FOUNDED, THE SUCCESSES WE'VE HAD SO FAR, AND THE CHALLENGES AHEAD.

IN JANUARY OF 1972 WHEN THE COAL SEVERANCE TAX WAS PROPOSED BY THEN-GOVERNOR FORD, WE IN THE COAL INDUSTRY NATURALLY OPPOSED IT BUT REALIZING IT WAS GOING TO PASS ANYWAY, I, AND SEVERAL OTHER COAL OPERATORS, WORKED TO GET HALF OF THIS NEW SOURCE OF REVENUE DEDICATED TO SOLVING THE PROBLEMS OF THE AREAS FROM WHICH IT CAME, EASTERN AND WESTERN KENTUCKY.

THIS WAS NOT TO BE IN 1972 BECAUSE GOVERNOR FORD HAD PLEDGED TO REPLACE THE SALES TAX ON FOOD, WHICH WAS GENERATING ABOUT $50 MILLION A YEAR WITH THE COAL SEVERANCE TAX WHICH WAS ESTIMATED TO GENERATE ABOUT $42 MILLION A YEAR FOR FISCAL YEAR 72-73 THAT WOULD BE LOST BY REMOVING THE SALES TAX ON FOOD.

BUT IN THE 1974 REGULAR SESSION OF THE LEGISLATURE, AS THE COAL BOOM BEGAN IN EARNEST, IT BECAME OBVIOUS THAT THE COAL SEVERANCE TAX, THEN AT 4% OF THE MINE-MOUTH VALUE OF RAW COAL, WAS GOING TO GENERATE A LOT MORE.

FOR EXAMPLE, ACTUAL COLLECTIONS FOR FISCAL YEAR 73-74 TURNED OUT TO BE IN EXCESS OF $53 MILLION, WHILE THE OFFICIAL ESTIMATE WAS $44 MILLION.

THE COAL LEGISLATORS BEGAN AN EFFORT TO INSERT A PROVISION IN THE BUDGET TO ALLOCATE ONE-HALF OF ALL SEVERANCE TAX COLLECTIONS DURING THE 1974-75 AND 75-76 FISCAL YEARS IN EXCESS OF THE AMOUNT BUDGETED TO A SPECIAL FUND CALLED THE COAL PRODUCING COUNTY DEVELOPMENT FUND, TO BE SPENT FOR THE BENEFIT OF THE COUNTIES FROM WHICH IT CAME.

THE GOVERNOR AND MANY POWERFUL MEMBERS OF THE LEGISLATURE OPPOSED THIS EFFORT AND HAD IT DEFEATED UNTIL HOOVER DAWAHARE, ATTEMPTING TO GAIN RECOGNITION FROM THE FLOOR FROM HOUSE SPEAKER NORM BLUME FOR THE PURPOSE OF INTRODUCING AN AMENDMENT TO AFFECT THE PROPOSED CHANGE, CLIMBED UPON HIS DESK, AND HAMMERED WITH HIS SHOE TO TRY TO GET RECOGNIZED TO SPEAK.

SPEAKER BLUME ORDERED THE SERGEANT-AT-ARMS TO REMOVE REPRESENTATIVE DAWAHARE FROM THE CHAMBER AND THE RESULTING PUBLICITY AND SYMPATHY GENERATED FOR THE CAUSE OVERWHELMED THE OPPOSITION AND THE MEASURE EVENTUALLY PASSED. THIS RESULTED IN $6.2 MILLION IN 74-75, AND $27.3 MILLION IN 75-76 AVAILABLE TO BE SPENT IN THE COAL-PRODUCING COUNTIES.

THIS PROGRAM, WHICH WAS CONTAINED ONLY IN THE BUDGET, LAPSED WHEN THE BUDGET EXPIRED AND GAVE GOVERNOR JULIAN CARROLL THE OPPORTUNITY TO REVISE THE PROGRAM AND MAKE IT PERMANENT, WE THOUGHT.

GOVERNOR CARROLL'S PROGRAM ENACTED IN '76 AND '78 INCREASED THE TAX RATE FROM 4% TO 4.5%, A 12% INCREASE, AND EXPANDED THE TAX BASE TO INCLUDE PROCESSING COSTS WHICH AMOUNTED TO ANOTHER 10% OR SO INCREASE.

THIS INCREASE AND A LOT OF THE EXISTING TAX WAS ALLOCATED TO SPECIFIC PROGRAMS FOR THE COAL PRODUCING COUNTIES AND OTHER COUNTIES WHOSE ROADS WERE IMPACTED BY COAL HAULING.

THESE PROGRAMS INCLUDED APPROXIMATELY $47 MILLION A YEAR TO RETIRE THE $600 MILLION RESOURCE RECOVERY ROAD BOND ISSUE TO BUILD MAJOR COAL HAULING ROADS LIKE KY 80 FROM HAZARD TO PRESTONSBURG.

FUNDS TO REPAIR BOTH STATE AND COUNTY ROADS DAMAGED BY COAL TRUCKS, FUNDS TO REDUCE THE COST OF WORKERS COMPENSATION AND FUNDS TO PROVIDE FOR LOCAL INFRASTRUCTURE LIKE SWIMMING POOLS, WATER LINES, AND LIBRARIES.

THESE PROGRAMS WOULD PROBABLY HAVE TAKEN 50% OF THE COAL SEVERANCE TAX TO THE COAL PRODUCING REGIONS BUT THEY WERE NEVER FULLY FUNDED.

BEING AN ASTUTE POLITICIAN, GOVERNOR CARROLL SECURED PASSAGE OF THE LAW BUT INSURED THAT MOST OF IT WOULD BE FUNDED IN FUTURE YEARS, SPECIFICALLY IN THE FIRST BUDGET OF THE NEXT GOVERNOR.

WELL, GOVERNOR BROWN DIDN'T THINK TOO MUCH OF THE IDEA OF HIM FUNDING THE PROGRAM THAT GOVERNOR CARROLL HAD GOTTEN CREDIT FOR.

COUNTY JUDGES DIDN'T THINK TOO MUCH OF THE PROGRAM BECAUSE THEY HAD NO CONTROL OVER THE EXPENDITURES OF THE MONEY AND LITTLE INFLUENCE.

SEVERAL FRESHMEN LEGISLATORS HAD RUN ON A PLATFORM OF 50% OF THE TAX BACK TO THE COAL PRODUCING COUNTIES, NOT REALIZING THAT THAT WAS ESSENTIALLY THE LAW, IT JUST HADN'T BEEN FUNDED.

I WAS DEPUTY SECRETARY OF TRANSPORTATION AT THE TIME SO I WAS INTIMATELY INVOLVED, OR SO I THOUGHT.

IN GOVERNOR BROWN'S BUDGET ADDRESS HE DESCRIBED THIS NEW PROGRAM TO GIVE 50% OF THE TAX BACK TO COAL PRODUCING COUNTIES AND DESCRIBED IN GLOWING TERMS WHAT IT WOULD MEAN TO THESE DEPRESSED AREAS.

THERE WAS JUST ONE LITTLE DETAIL.

HE WAS TALKING ABOUT 50% OF ALL THE INCREASE IN THE SEVERANCE TAX AFTER THE 80-81 FISCAL YEAR.

BY THIS TIME, BECAUSE OF THE COAL BOOM, THE TAX WAS ESTIMATED TO PRODUCE $177.6 MILLION, A DRAMATIC INCREASE OF ALMOST 500% IN EIGHT YEARS. MANY COUNTY JUDGES SUPPORTED THE GOVERNOR BECAUSE UNDER HIS PROGRAM, THE MONEY WOULD BE GIVEN DIRECTLY TO THE FISCAL COURTS WITH FEW STRINGS ATTACHED.

THEY WERE WILLING TO GIVE UP FUNDS FOR THEIR COUNTY FOR ONE YEAR WHICH THEY DIDN'T CONTROL FOR THE PROMISE OF VAST AMOUNTS OF MONEY IN THE COUNTY TREASURY IN THE YEARS AHEAD.

THE BROWN ADMINISTRATION WAS PROJECTING THAT THE COAL SEVERANCE TAX REVENUE WOULD CONTINUE TO INCREASE AT ABOUT THE SAME RATE OF GROWTH AS THE PAST EIGHT YEARS WHICH WAS A FISCAL IMPOSSIBILITY.

IN FACT, MOST KNOWLEDGEABLE PEOPLE KNEW THAT THE COAL BOOM HAD RUN ITS COURSE AND SEVERANCE TAX REVENUE MIGHT ACTUALLY DECLINE IN THE FUTURE.

THE JUDGES WERE TRADING A SURE THING THEY DIDN'T CONTROL FOR THE PROMISE OF 50% OF THE GROWTH WHICH COULD VERY WELL BE 50% OF NOTHING.

I OPPOSED THE PLAN AND RESIGNED MY POSITION AS DEPUTY SECRETARY OF TRANSPORTATION IN PROTEST BUT THE PROGRAM PASSED ANYWAY.

THE PREDICTION THAT THE SEVERANCE TAX COULD ACTUALLY FALL DID COME TRUE.

THIS PAST YEAR THE TAX PRODUCED JUST $166 MILLION, $11 MILLION LOWER THAN THE $177.6 MILLION THRESHOLD OF 1980.

THIS YEAR, IF THE PROGRAM HAD NOT BEEN CHANGED, THE COAL COUNTIES WOULD HAVE RECEIVED 50% OF NOTHING.

AFTER RESIGNING, I WENT BACK TO PIKE COUNTY AND RAN AGAINST THEN-COUNTY JUDGE WAYNE RUTHERFORD BECAUSE I WAS SO UPSET THAT HE SUPPORTED A PROGRAM I KNEW TO BE A MISTAKE.

AS COUNTY JUDGE, I WORKED TO PUT A FLOOR ON THE AMOUNT WE WOULD RECEIVE AND IN THE 1986 SESSION OF THE LEGISLATURE WE RECEIVED THE CURRENT GUARANTEED OF AT LEAST 12% FOR THE LOCAL GOVERNMENT ECONOMIC ASSISTANCE PROGRAM.

THAT, TOO, CARRIES AN INTERESTING STORY THAT I WON'T GO INTO.

THE JONES ADMINISTRATION, BEING THE FIRST SUCCESSFUL CANDIDATE FOR GOVERNOR TO HAVE COMMITTED TO 50% OF ALL THE COAL SEVERANCE TAX BEING RETURNED TO THE COAL AREAS, SUPPORTED A LAW TO MANDATE THAT.

I WAS PRESIDING OVER THE SENATE WHEN THAT BILL PASSED.

IT WAS AN EMOTIONAL MOMENT FOR ME AND A HISTORIC MOMENT FOR THE STATE.

THE CHAMBER FELL SILENT AS THE ROLL WAS CALLED.

THAT MEASURE THAT SO MANY OF US HAD FOUGHT FOR FOR 20 YEARS, 50% OF THE COAL SEVERANCE TAX BACK TO THE COAL COUNTIES TO BUILD AN ECONOMY TO REPLACE COAL WHEN IT'S GONE, HAD FINALLY PASSED, WITHOUT A DISSENTING VOTE!

ONE LITTLE PROBLEM STILL EXISTED, THE BUDGET, WHICH TAKES PRECEDENCE OVER A PREVIOUSLY PASSED LAW, ONLY FUNDED 3% OF THE PROMISED 38% IN NEW FUNDING. AGAIN, THE CLASSIC POLITICAL PLOY OF MAKING THE PROMISE THAT THE NEXT GOVERNOR MUST FIND MOST OF THE MONEY TO FUND.

NOTWITHSTANDING THE FACT THAT THE LAW WAS NOT FULLY FUNDED, IT WAS A MAJOR STEP FORWARD.

I HAD EVERY INTENTION OF FULLY FUNDING THE LOCAL GOVERNMENT ECONOMIC DEVELOPMENT FUND IN MY FIRST BUDGET BUT I, LIKE MOST NEW GOVERNORS COMING INTO OFFICE, FOUND THE CUPBOARD WAS BARE.

WE ARE SENDING 28 % OF THE SEVERANCE TAX BACK TO THE COAL PRODUCING COUNTIES AND I DO EXPECT TO FULLY FUND THIS PROGRAM BEFORE I LEAVE OFFICE.

MY NARRATIVE OUTLINES THE DIFFICULTIES WE'VE HAD GETTING TO WHERE WE ARE AND THE COAL COALITION HAS BEEN INVOLVED IN AND HAS BEEN AN INDISPENSABLE PART OF EVERY BATTLE.

THIS IS ONE ORGANIZATION THAT HAS KEPT ITS EYE ON THE BALL, AND NOT TRIED TO EXPAND ITSELF TO BE MORE THAN IT STARTED OUT TO BE.

AND IT'S A GOOD THING BECAUSE THE BATTLE IS NOT OVER.

IN FACT, THE BIGGEST BATTLE MAY BE JUST BEGUN BECAUSE I BELIEVE THE FOUNDATION OF THE COAL SEVERANCE TAX, THE COAL INDUSTRY ITSELF, IS THREATENED.

AND IF WE LOSE A SUBSTANTIAL PORTION OF THE COAL INDUSTRY IN THIS STATE, THE LOSS OF A PROPORTIONED AMOUNT OF THE COAL SEVERANCE TAX WILL BE THE LEAST OF YOUR PROBLEMS.

AND THE LEAST OF THE STATE'S PROBLEMS TOO.

THE COAL BOOM OF THE 70'S WAS GREAT FOR ALL OF KENTUCKY BUT IT WAS ESPECIALLY GOOD FOR THE COAL PRODUCING AREAS.

BUT IT'S BEEN DOWNHILL EVER SINCE.

FIRST ,COAL LOST ITS FOREIGN MARKETS.

NOW FOREIGN COAL IS BEING IMPORTED INTO THE UNITED STATES.

EVEN MORE OMINOUS IS THE DEVELOPMENT OF THE WESTERN COAL FIELDS AND RESTRICTIONS ON HIGH SULFUR EASTERN COAL.

THESE LOSSES HAVE BEEN OFFSET SOMEWHAT BY THE CONTINUED INCREASE IN THE CONSUMPTION OF COAL IN THE UNITED STATES, PRIMARILY FOR ELECTRIC POWER GENERATION.

PRODUCTION IN THE LOW-SULFUR SOUTHERN APPALACHIAN COAL FIELDS, EASTERN KENTUCKY, SOUTHERN WEST VIRGINIA, VIRGINIA AND TENNESSEE HAS REMAINED STABLE OVER THE PAST 10 YEARS.

BUT KENTUCKY HAS LOST GROUND.

WE USED TO BE THE #1 PRODUCER AND WE'VE NOW DROPPED TO #3. WE USED TO PRODUCE 22% MORE THAN OUR PRIME COMPETITOR FOR LOW SULFUR EASTERN COAL, WEST VIRGINIA, BUT WE NOW PRODUCE 13 % LESS.

WE HAVE EXPERIENCED A GRADUAL EROSION OF OUR COAL INDUSTRY IN THE EAST AND A DRAMATIC DECLINE IN THE WEST, A 29 % REDUCTION IN TONS (FROM FISCAL YEAR 84-94) AND 41 % REDUCTION IN JOBS IN THE WEST FROM 1984-1994.

PRODUCTION REMAINED CONSTANT IN THE EAST BUT JOBS DROPPED BY 38% FROM 1984 TO 1994.

BUT I BELIEVE THAT WE ARE NOW IN THE MIDST OF A DRAMATIC DROP IN COAL PRODUCTION CAUSED BY THE DRAMATIC INCREASE IN WORKERS COMPENSATION COSTS WHICH HAVE BEEN OCCASIONED BY CHANGES IN THE WORKERS COMPENSATION LAWS IN 1994.

THESE CHANGES IN GENERAL REDUCED THE BENEFITS PAID TO INJURED WORKERS AND HAVE RESULTED IN REDUCED COSTS TO MOST EMPLOYERS BUT THAT HAS NOT BEEN TRUE FOR THE COAL INDUSTRY.

THE ELIMINATION OF THE HIGH RISK POOL AND THE ESTABLISHMENT OF THE STATE-SPONSORED INSURER OF LAST RESORT, THE KENTUCKY EMPLOYERS MUTUAL INSURANCE AUTHORITY, HAS RESULTED IN DRAMATIC INCREASES IN THE COST OF WORKERS COMPENSATION FOR MOST COAL COMPANIES - INCREASES IN THE RANGE OF 60%, INCREASES COSTING $1.00 A TON, 5% OF THE SELLING PRICE; INCREASES EXCEEDING PROFITS.

THESE INCREASES HAVE BEEN PHASED IN OVER THE LAST YEAR DEPENDING ON THE EXPIRATION DATE OF A COMPANY'S COMPENSATION POLICY SO THE EXACT EFFECT CANNOT YET BE FULLY DETERMINED.

BUT EMPIRICAL EVIDENCE INDICATES THAT THE EFFECT HAS BEEN SUBSTANTIAL.

COAL SEVERANCE TAX COLLECTIONS FOR FISCAL YEAR 1995-96 WERE ABOUT 166 MILLION DOLLARS, WHICH IS $13 MILLION AND 7.3 % LESS THAN THE COLLECTIONS OF ONE YEAR AGO.

TONNAGE MINED IN KENTUCKY AS REPORTED BY THE U.S. DEPARTMENT OF ENERGY IS DOWN 6.74% FROM 1990 TO 1994.

THIS DOES NOT APPEAR TO BE A CONDITION OF THE INDUSTRY BUT RATHER A PHENOMENON UNIQUE TO KENTUCKY.

WEST VIRGINIA, OUR MAJOR COMPETITOR FOR LOW SULFUR COAL, REPORTS STABLE PRODUCTION DURING THAT SAME PERIOD AND THEIR BUSINESS AND OCCUPATION TAX ON COAL, SIMILAR TO OUR SEVERANCE TAX, HAS BEEN RELATIVELY STABLE DURING THAT PERIOD.

(NOTE: W.VA IS DOWN 3%, KY IS DOWN 8.5% OVER THE LAST 52 WEEKS.)

WEST VIRGINIA FACED THE PROBLEM OF THE HIGH COST OF WORKERS' COMP IN COAL IN 1994 AND THE EFFECTS OF THOSE CHANGES ARE BEGINNING TO SHOW IN WEST VIRGINIA.

THE EFFECT OF THE INCREASES IN WORKERS COMPENSATION COSTS FOR COAL DURING THE PAST YEAR CAUSED BY THE CHANGES IN KENTUCKY IN 1994 HAS NOT BEEN FULLY FELT IN THE MARKET AND THE FULL IMPACT OF THE 1994 CHANGES HAVE NOT YET BEEN FULLY APPLIED TO COAL.

THE 1994 LAW REQUIRES KEMI, THE KENTUCKY EMPLOYERS MUTUAL INSURANCE AUTHORITY, TO BE FULLY CAPITALIZED WITHIN THREE YEARS AND APPEARS TO REQUIRE CONCURRENT CAPITALIZATION AS ITS BUSINESS GROWS.

NO OTHER STATE WHICH STARTED A FUND WITH A SIMILAR MISSION HAS BEEN SUBJECT TO SUCH RIGID REQUIREMENTS.

WE INITIALLY WERE TOLD THAT IN ORDER FOR KEMI TO MEET THE REQUIREMENTS OF THE LAW, THEY WOULD HAVE TO IMPOSE A 50% INCREASE IN RATES ABOUT SEPTEMBER 1ST.

LET ME MAKE ONE FLAT STATEMENT.

THE PREMIUM INSURED COAL COMPANY CANNOT STAND THAT KIND OF AN INCREASE IN COSTS.

THEIR ONLY RECOURSE WOULD BE DRAMATIC CUTS IN WAGES OR SHUTDOWNS.

OF THAT I AM CONVINCED.

I HAVE MANAGED TO GET ALL PARTIES INVOLVED TO AGREE THAT THE ASSESSMENT IS NOT REQUIRED SEPTEMBER 1ST, BUT UNLESS THE LAW IS CHANGED, KEMI WILL EVENTUALLY, NO LATER THAN TWO YEARS FROM NOW, BE REQUIRED TO DRAMATICALLY INCREASE THEIR RATES, NOT ONLY TO COAL, BUT TO 12,000 OTHER SMALL COMPANIES ALL ACROSS KENTUCKY.

I SUPPORTED THAT CHANGE IN THE '96 SESSION BUT INTERESTS DEMANDING A COMPREHENSIVE REVISION OF THE ENTIRE WORKER'S COMPENSATION SYSTEM THWARTED THAT EFFORT.

ANOTHER THREAT THAT FACES KENTUCKY COAL AND NO OTHER STATE IS THE SPECIAL ASSESSMENT OF $40 MILLION A YEAR TO PAY FOR BENEFITS AWARDED IN THE PAST.

THIS ASSESSMENT IS $40 MILLION NO MATTER HOW MUCH OR HOW LITTLE COAL IS MINED IN KENTUCKY.

BECAUSE THE AMOUNT OF COAL BEING MINED IN KENTUCKY IS GOING DOWN, THIS SPECIAL ASSESSMENT MUST GO UP TO GENERATE $40 MILLION.

CURRENT ESTIMATES ARE THAT THIS ASSESSMENT WILL INCREASE BY ABOUT 50% EFFECTIVE JANUARY 1 OF 1997.

FOLKS, COAL CAN'T STAND IT!

SOMETHING MUST BE DONE!

I DON'T YET KNOW WHAT I WILL PROPOSE TO THE LEGISLATURE BUT I AM COMMITTED TO PROPOSING CHANGE BEFORE THIS YEAR IS OUT.

WE HAVE NO CHOICE, TIME IS RUNNING OUT; ON THE COAL INDUSTRY, ON COAL MINERS, ON KENTUCKY STATE GOVERNMENT AND ON LOCAL GOVERNMENTS DEPENDENT ON COAL MINING FOR JOBS AND COAL SEVERANCE TAX TO PROVIDE ESSENTIAL SERVICES.

I'M CONVINCED THAT THE SPECIAL ASSESSMENT ON COAL, AN ASSESSMENT NOT PLACED ON ANY OTHER INDUSTRY, MUST BE REMOVED.

I ATTEMPTED TO DO THIS ON A TEMPORARY BASIS DURING THE PAST SESSION BUT WAS UNSUCCESSFUL. TO PARTIALLY REPLACE THE REVENUE LOST TO THE SPECIAL FUND, I WILL PROPOSE THAT ONE-NINTH OF THE COAL SEVERANCE TAX, ABOUT $20 MILLION, BE PERMANENTLY ALLOCATED TO THE SPECIAL FUND TO SATISFY COAL'S OBLIGATION TO FUND PAST LIABILITIES OF THE SPECIAL FUND.

THE RESULT OF THAT ACTION, IF IT OCCURS, WILL BE TO REDUCE THE AMOUNT OF MONEY IN THE LOCAL GOVERNMENT ECONOMIC ASSISTANCE FUND BY ABOUT $2.5 MILLION.

EACH OF YOUR COUNTIES WILL ABSORB A FRACTION OF THIS COST.

ABOUT $3 MILLION WILL BE TAKEN FROM THE LOCAL GOVERNMENT ECONOMIC DEVELOPMENT FUND AND STATE GOVERNMENT WILL HAVE TO ABSORB ABOUT $13 MILLION OF THE COST.

TO SAVE COAL, EVERYBODY'S GOING TO HAVE TO GIVE A LITTLE.

I'M HERE TO ASK YOU TO SUPPORT THIS AND WHATEVER OTHER MEASURES I PROPOSE TO REDUCE WORKER'S COMPENSATION COSTS TO COAL COMPANIES.

I CAN ASSURE YOU THAT I WILL NOT SUPPORT MEASURES TO REDUCE BENEFITS TO TRULY INJURED AND NEEDY COAL MINERS.

THEY TOOK THEIR LICKS IN THE 1994 SESSION AND I INTEND TO PROTECT THEM AND ALL THE OTHER TRULY INJURED WORKERS IN KENTUCKY.

THE OPTIONS BEFORE US ARE TO PAY NOW OR PAY LATER.

THE CHEAPEST AND MOST HUMANE THING TO DO IS TO FACE UP TO THE PROBLEM AND DO WHATEVER IT TAKES TO SOLVE IT.

WEST VIRGINIA DID IN 1994, AND KENTUCKY MUST DO IT IN 1996.

WE HAVE COME A LONG WAY TOGETHER.

WE STILL HAVE A ROUGH ROW TO HOE.

I NEED YOUR SUPPORT AS I PROPOSE MAJOR CHANGES IN THIS AND OTHER AREAS OF OUR STATE GOVERNMENT.

THERE IS NO FREE LUNCH; SOMEONE MUST PAY FOR EVERYTHING.

I WILL ALWAYS DO WHAT I THINK IS FAIR TO ALL, ALWAYS KEEPING IN MIND THAT FOR GOVERNMENT TO HELP IT MAY BE NECESSARY TO TAKE FROM ONE TO HELP ANOTHER, BUT IF WE DO IT RIGHT, ALL OUR PEOPLE WILL GAIN.

THAT IS MY GOAL, A GOVERNMENT WHICH HELPS EVERYBODY, BY GROWING OUR ECONOMY AND GIVING OUR PEOPLE THE OPPORTUNITY TO SOLVE THEIR OWN PROBLEMS THROUGH WORK.

I SERVE ALL THE PEOPLE OF KENTUCKY BUT IN SO DOING I MUST IMPROVE THE ECONOMY OF THE COAL FIELDS OF KENTUCKY AND OUR FIRST RESPONSIBILITY IS TO SAVE WHAT WE HAVE AS LOOK FOR MORE.

IT IS A GREAT CHALLENGE BUT I THINK WE HAVE GREAT OPPORTUNITIES.

THANK YOU ALL FOR YOUR SUPPORT AND YOUR FRIENDSHIP.

GOOD NIGHT AND GOD BLESS YOU.