Election 2019

Adam Edelen is doing something most Democrats running for statewide office in Kentucky have avoided: running as a progressive. He wants Kentucky to invest in renewable energy, decriminalize possession of small amounts of marijuana and he supports abortion rights.

Edelen is one of four Democrats running for governor this year. He’s a businessman from Lexington and previously served as state auditor, before he lost reelection in 2015.

After that, Edelen established Edelen Strategic Ventures, a consulting firm where he has helped develop a solar power project in Pike County on top of a former coal mine.

Not as well-known as the presumed front runner Andy Beshear, Edelen has run an aggressive ad campaign to try and build his name recognition. His running mate is Gill Holland, a Louisville filmmaker and real estate mogul who has loaned the campaign $1.5 million out of a total $2.4 million raised so far. (Holland is also a board member of Louisville Public Media; per LPM policy he is on leave from the board for the entirety of the campaign.)

Before his term as state auditor, Edelen served as Gov. Steve Beshear’s chief of staff, as Kentucky’s director of homeland security and worked as a staffer in Gov. Paul Patton’s office.

Edelen sat for an hour-long interview with WFPL reporters in March. You can listen to his full interview below, or read and listen to highlights on some of the big issues facing Kentucky today. Transcripts have been condensed for clarity.

Edelen on what Kentucky should do to address its underfunded pension systems

Edelen on ways Kentucky could raise revenue

Edelen’s position on Kentucky’s Medicaid expansion

Edelen on recent anti-abortion laws passed by the Kentucky General Assembly

Edelen on possible solutions for the opioid crisis

Edelen’s position on school choice and charter schools

Edelen’s stance on climate change

Edelen on ways to spur economic development in eastern Kentucky

Pensions

Question: Kentucky has a $37 billion pension debt. Governor Bevin has proposed dealing with this by altering benefits for future state workers and putting lots and lots of money into the pension systems. Do you support his model of how he’s been dealing with it? And if not, what would you do?

Answer: “I don’t [support Bevin’s model]. As state auditor, I conducted a large audit of the Teachers Retirement System and found that it had a lot of safeguards in place that the other systems simply didn’t have. They’ve never used placement agents, which are essentially lobbyists employed by Wall Street to lure investments. They never used hedge fund managers. It was more politically independent from the governor. And it’s been well run. The problem is teachers had paid into the system and the politicians simply didn’t. The other side, with the other systems, particularly those governed by KERS. It was the Wild West. I mean, we had fund managers who were literally on the lam for a while. There was a large scale reliance on placement agents, clearly the system was victimized by Wall Street. And we didn’t have the right kind of people.

“What we need on these boards are qualified people who are credentialed and have the stature to govern systems that manage billions of dollars and investments and also protect us from Wall Street. So overlay that with the fact that we had the wrong people running the show, overlay that with the Great Recession that wiped out trillions of dollars of wealth globally. And and the fact that we missed something like 16 of 21 years of annual payments, that’s what got us into the mess that we got into; that we’re currently in. And it’s going to take 20 years for us to get out. But we need to make sure we fully fund the system. But we also need to make sure that that board is more politically independent.

“As Governor, I won’t appoint anyone to that board, who gave me a dime. I firmly believe that it has to be credentialed folks. We’ve got to reevaluate governance, so we don’t make the mistakes that we’ve made previously. And we’ve got to make the payment to get us out of the mess we’re in.”

J. Tyler Franklin | wfpl.org

Adam Edelen in the WFPL studio on March 22, 2019

Revenue

Question: So if fully funding the system part of it, how how’s the state going to keep up with putting these massive amounts of money into the into the system?

Answer: “Well, we simply have no choice and that’s why I’m I’m open to new revenue.

“So being able to come up with a direct line revenue source, whether it be expanded gaming, or whatever. I think we’ve got to be willing to have a conversation about most anything to help supplement the funding that’s required to make this system solvent and to reduce the long-term bottom line liability, which is driving up our debt cost, is it is the appropriate way forward.”

Question: Can you talk more about revenue? You mentioned expanded gambling — that that’s something you’re interested in. What’s your proposal? Kentucky’s… I think there’ve been budget shortfalls in 10 of the last 15 years…

Answer: “We have. And particularly in a period in which we’re supposed to see prosperity, it’s clear that we have a tax system that is that is both retarding the development of business, and also not meeting the demands of the treasury. And so the stab that the legislature took last year at modernizing our tax system was completely the wrong way to go.

“And the best indication of how far off the path we’ve gotten is that we’re literally taxing charities in Kentucky and that’s a clear demonstration of, I just think, how far afield we are and we’ve got to reevaluate this. And certainly with the Republican legislature, it will be difficult.

“People know that we are short changing a lot of things that we used to fully fund, and they’re seeing it in their daily lives. And I think Kentucky is ready for a conversation about how we modernize our tax system and how we fully fund those things we value, from healthcare and education to safeguards to protect workers.

“And I think my experience is that people in Kentucky are prepared to make investment, provided they know exactly where it’ll go to. And that’s going to require a different kind of leadership set in Frankfort, for sure.”

Medicaid Expansion

Question: So one of the big issues that’s been going on for the past couple years is with Medicaid expansion. Would you keep it?

Answer: “I would. And matter of fact, it’s a key issue I’m running on. We tried in this state, the strategy of having a large uninsured population for about 100 years, and it damn near bankrupted us. And it’s given us the worst healthcare outcomes in America. Certainly over the long term, it is cheaper to have people insured rather than not. And the fact that we lead the country in reducing our large uninsured population is something that we ought to be celebrating. And for the life of me, I can’t understand why the governor’s trying to retreat so quickly in the other direction.

“So, I’m a huge proponent of the Medicaid expansion. I think I know more about health care policy than anybody in this race.”

Question: The Medicaid budget takes up a huge amount of the state budget overall. How would you deal with that? Do you have any ideas on taking hold of that somehow?

Answer: “I do. So to your point, Medicaid is an issue that traditionally makes the eyes of governors glaze over. I’ve worked for them. I know that this is a complicated unsexy topic. But the Cabinet for Health and Family Services and the social network, the social safety net that they manage and administer represents a third of the budget in terms of both state government and manpower. This is hugely important.

“So, not only will I’ll be a hands-on governor in the health care space, because I care a lot about it. As state auditor, I conducted a huge review of Medicaid, I fought my own governor over his introduction of managed care into the Medicaid system. I stress tested the financial health of every rural hospital in Kentucky. This is a policy area that is one of two that really drives the whole state. The two most important issues are education and health care. And I happen to care a lot about them and will lead from the front on both.”

Question: But how do you do that in the short term?

Answer: “Well, there are a whole host of opportunities.

“I just think that Medicaid is something that we’ve got to fund and the shortfall is often reported by that cabinet, but it’s always all over the place. I mean, the shortfall predicted in Medicaid early in the year was a multiple of what it actually turned out to be. So I think when you have better leaders who actually have experience in health policy and health administration running that cabinet, we’ll be able to find economies and will be able to continue to make the system sustainable. But my belief is people who fundamentally don’t believe in the notion that everybody ought to have healthcare, can’t be trusted to run a system that’s designed to make sure that everybody has healthcare.”

Question: Would you increase the tax on hospitals that they pay?

Answer: “Well, I think that’s that’s certainly a conversation that has to be had, because there are some hospitals that are doing very well, under the Medicaid expansion. There are some that are just getting to sufficiency.

“My understanding of it is, is that you can’t treat people within the classes, right? That under Medicaid, there is no differentiation between a rural hospital and a large urban hospital that might be doing well. So this is very complicated stuff. It requires somebody with a skill set to drill down. I’ve got the ability to do that. And I think I’ve got the relationships to make it happen.”

Abortion

Question: The Kentucky General Assembly has passed several abortion laws in previous years and  this year, what’s your stance on this?

Answer: “Well, you know, I’m I am unapologetically a strong advocate of a woman’s right to make her own healthcare decisions. So that’s where I am on the issue. Beyond that, it galls me that in a time and place when we’re on the verge of laying off school teachers, that we’re hiring lawyers to fight lawsuits that have no chance of winning under the current law of the land.”

Opioids

Question: And what about the opioid epidemic? It seems to be getting better now. But how do you propose to sort of support families that are in that crisis?

Answer: “It’s like Whack-a-Mole. It’s getting better in some areas, but it it becomes exacerbated in others. So while the number of pills that people are taking is diminishing, the number of the the amounts of other drugs that we’re seeing, particularly meth is increasing.

“What I’m hearing is twofold. One, your chances of beating your addiction are nil unless you have insurance. So anybody who says they’re serious about winning the battle of addiction in Kentucky, who is also not expanding insurance is a charlatan; they’re just not serious about it. The other is that we have to offer medical marijuana as an alternative to people getting treated by these heroin-based opioids in the first place. This is really important, because not only do we need to treat the number of folks who become addicts, we have got to stop the addict factory. And you can’t meaningfully stop the addict factory without introducing medical marijuana is an alternative to these really ravenous drugs that that get people addicted for lifetimes.”

Charter Schools

Question: School choice has become a hot topic in Kentucky with legislation to create charter schools, but not yet to fund them, and discussions around scholarship tax credits to help support private school education. Generally, what is your position on “school choice?”

Answer: “I reject the term outright, because it’s school choice for people who can afford it. And so in a time and a place when the central challenge of our public school system is that they’re underfunded, anything that diverts resources from public school classroom, to me, is something that we don’t have the luxury of considering.”

Climate Change

Question: What priority will your administration place on climate change? And what will your administration do to combat those impacts?

Answer: “Climate change is real. And so are the thousands of jobs that can be created in fighting it. And so I would expand to say, not only is climate change real, there is much more opportunity to be produced in fighting it rather than in denying it. This is a critical issue, and it’s the critical issue of our time, but it’s not just about environmental stewardship; it’s about relevance to a 21st century economy. The fact that I was able to bring together a coal company with a renewable energy firm to do what will be the largest solar installation in Kentucky, among the largest in this part of the U.S. and the first in Appalachia, I think not only demonstrates my commitment to putting Kentucky on the right side of history here, but also to seizing these opportunities.

“I’m a believer in climate change. And I’m an advocate for fighting it. I am also an evangelist for the opportunities that Kentucky can seize by being relevant to the changes that are occurring in technology, economy and culture.”

Economic Transition

Question: So how will you manage this energy transition in a way that benefits disadvantaged communities, particularly those hit hardest by coal as a source of revenue?

Answer: “My partnership that I put together — I did the deal structure, I have developed the project — will put back together at least a couple hundred out of work coal miners in an industry of the future. And this is a big deal. Because had I suggested this five or six years ago, I might have been run out of Kentucky on a rail. But people know that while certainly we want to protect the coal jobs we have, the industry’s shoulders are never going to be so broad again to support an entire region, which requires diversification. And renewable energy isn’t the only answer. But it is one of the answers along with healthcare and technology and tourism, that will help us transform Appalachia.

“And this is going to be a big fight. And I hope that we can get everybody together to figure this out. But imagine living in a time and a place, particularly in Appalachia or West Louisville, where a lot of people are paying utility bills bigger than their damn mortgages. That’s a problem. And so as technology and leadership affords the opportunity to provide the democratization of power production, let’s harness that. And so I just believe that that the energy sector ought to exist for the benefit of the ratepayers and we need a strengthened Public Service Commission. And we certainly need a diversified energy portfolio in Kentucky.”

About this series: WFPL invited all eight Republican and Democratic gubernatorial candidates to sit down for an hour-long interview with a panel of our reporters on a variety of policy issues. Five responded in some way. We’ll be rolling out profiles of those five candidates in the coming days, along with a profile of Gov. Matt Bevin; while he wouldn’t sit for an interview, in his first term as governor he’s established a policy record from which voters can draw. You can read other profiles as they’re published here.

Disclosure: Edelen’s running mate, Gill Holland, is a member of the Louisville Public Media Board of Directors. Per LPM policy, as a candidate for public office he is on leave from the board for the entirety of the campaign.