Members of the Kentucky House on Thursday passed HB 500, the executive branch budget for the upcoming biennium. The measure now moves to the Senate, where lawmakers will make revisions before a final version is negotiated between the two chambers.
While the proposal includes across-the-board reductions – 4% in fiscal year 2027 and an additional 3% in FY2028 – most county programs were exempted from the cuts, including:
- Court security reimbursement remains at $15 per hour.
- Jail funding remains at same level as the current biennium. (Additional changes could occur as HB 557 continues moving through the process.)
- $10 million each fiscal year for grants to law enforcement and first responders for body armor, duty weapons, ammunition, electronic-control devices, and body-worn cameras.
The budget also provides a 2% salary increase each year for state employees, Commonwealth’s attorneys, county attorneys and property valuation administrators (PVAs).
Judicial and transportation budgets
The House also passed HB 504, the judicial branch budget. It includes a 2% annual salary increase for deputy circuit court clerks. Additionally, the bill provides $2.1 million in FY2027 and $4.3 million in FY2028 for inflationary increases to operating expenses paid to counties through the Local Facilities Fund. The spending plan also includes two judicial center projects for Bell and Boyle counties.
The transportation budget, HB 501, has not yet received a committee hearing in the House.
County jail legislation gains support
KACo’s government affairs team continues to meet with legislators to promote HB 557 and seek co-sponsors in the House. The comprehensive jail bill now has more than 50 co-sponsors.
County officials can access KACo’s HB 557 resource page for background information, a sample fiscal court resolution and a social media toolkit.
Thank you to everyone who has engaged their House legislators. We appreciate your continued engagement!
Revenue bill filed
HB 757, sponsored by House Appropriations and Revenue Chair Jason Petrie (R-Todd County), was filed this week as the annual revenue bill. The nearly 300-page measure addresses a variety of tax and revenue issues, including:
- Sunsetting tax increment financing (TIF) programs after the bill’s effective date. Existing TIFs would remain in place but could not be amended or have activation date extensions.
- Amending the regional industrial taxing district program established during the 2025 legislative session.
- Establishing guidance for rounding cash payments to local governments when pennies are unavailable.
Online occupational tax filing
HB 518, sponsored by House Local Government Committee Chair Rep. Patrick Flannery (R-Carter County), passed the House this week. The measure is a compromise bill on electronic filing and payment of occupational taxes. Unlike past bills, this proposal does not call for centralized collection of local occupational license fees by the state.
The bill requires all local governments with an occupational license tax to post on their website a fillable PDF for online returns and allow electronic payment of the tax due by July 1, 2029. Counties would be able to charge and collect an additional electronic processing fee and recover actual costs associated with electronic filing, processing, security, maintenance and payment acceptance. The bill now heads to the Senate for consideration.
Important legislative dates
March 2 – Last day for new Senate bills
March 4 – Last day for new House bills
April 2-13 – Veto recess
April 14-15 – Final two days of session
For questions or feedback, contact Shellie Hampton - shellie.hampton@kaco.org or Kayla Smith - kayla.smith@kaco.org.
