Measure to give local governments more tax options defeated

FRANKFORT, Ky. (AP) - A proposed constitutional change to give local governments more latitude to raise tax revenue was defeated by the Kentucky House on Friday, but the measure could still be revived.

The legislation fell 11 votes short of the 60-vote threshold needed for passage. Slightly more than one-third of the House members - mostly Democrats - didn’t cast votes on the proposal. Their abstentions sparked heated discussions between some Republican and Democratic members.

House Speaker David Osborne, a cosponsor of the measure, later told reporters that the constitutional amendment could potentially come up again later in the GOP-led House.

The measure, if added to Kentucky’s Constitution, would ease tight restrictions on the types of taxes that city and county governments can levy to meet their obligations.

Supporters include groups representing city and county governments. Current restrictions force local governments to rely heavily on property taxes and taxes levied on wages and business income, they say. Opponents include the Kentucky Retail Federation, which warns the constitutional change could lead to new sales taxes that it says would hurt consumers and retailers.

If voters ratified the constitutional change, the legislature could follow up by considering a new taxing framework giving local governments more flexibility in deciding which taxes to assess.