House plan would make more than $1.74 billion in investments towards state’s priority areas

In addition to the state budget, we are also considering legislation that taps existing state resources to make significant one-time investments in infrastructure, public safety, and economic development, as well as paying down the state’s public pension liabilities.

The measure, HB 1, is different from the budget because it only includes one-time spending. We know there are those who would like to see us spend more money, and a few who would like to see us increase taxes to do so. Instead, we are considering several big investments in targeted areas that will improve the quality of life for Kentuckians today and strengthen the state’s fiscal position for the future.

The measure is based on a simple philosophy – you only make these kinds of investments with money you already have. HB 1 uses funds that are already in our possession. We have made saving a priority and now the budget reserve trust fund exists to ensure our state is both prepared to take advantage of opportunities as well as provide for the state during difficult times.

HB 1 includes one-time allocations totaling $1.74 billion over the current and next two fiscal years. The measure contains:

• $500 million towards the unfunded liability within the Kentucky Teacher’s Retirement System
• $300 million towards the unfunded liability within the Kentucky Employees Retirement System Non-Hazardous Pension Fund
• $150 million to pay down the unfunded liability within the Kentucky State Police pension fund
• $450 million to provide the necessary match to approved federal grants through the GRANT program created with the passage of HB 9/2023 Regular Session
• $150 million for drinking and wastewater infrastructure
• $75 million towards site development for economic development purposes under the Kentucky Product Development Initiative program
• $50 million towards the finance authority loan pool for economic development
• $6,395,000 for the purchase of lab equipment for use by the Kentucky State Police
• $15 million for the short line infrastructure preservation program within the Kentucky Rail Development Program
• $15 million for the industrial access and safety program within the Kentucky Rail Development Program
• $18.5 million towards the Riverport Asset Preservation Program
• $11.4 million in funding to provide $200,000 grants to each of the state’s general aviation airports

I cannot emphasize enough that these investments are one-time only and that funding for them already exists within the state’s budget reserve trust fund. If HB 1 passed into law, enough money still remains in our budget reserve trust to cover the cost of approximately 45 operating days. And, economists anticipate another robust budget surplus when the current fiscal year ends on June 30. Our goal is to maintain that healthy savings so that we may not only provide for the day-to-day, necessary functions of state government, but also continue lowering the individual income tax and looking for ways to invest in our future.