HB 75 update

FRANKFORT—A bill that would give local governments more ways to increase revenue is on its way to the Senate after passing the House by 95-0 vote.

House Bill 75, sponsored by Rep. Steve Riggs, D-Louisville, would allow cities, counties and other local entities to pursue more aggressive investment through mutual, closed-end and exchange-traded funds and high-quality corporate bonds, all within certain limits and under the guidance of a professional investment adviser.

Riggs said he expects local government investment returns to increase fivefold under the bill. He said local government investment returns are now only around half of 1 percent due to outdated laws.

Improving returns, he said, will improve revenues “which, in turn, keeps the pressure off any need they might have to raise taxes – it stops that from happening,” said Riggs.

Local governments “like the idea of being allowed to improve their investment portfolios to improve the return on the deposits that they make,” he said.

HB 75 would also tighten requirements for credit rating agencies that rate securities and other investments currently used by local government entities, or may be used by those entities should HB 75 become law.