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Legislators unveil eastern Kentucky flood relief bill

By Kayla Carter Smith, Policy Analyst
Wednesday, legislators introduced HB1 (Rep. John Blanton) and SB1 (Senate President Robert Stivers) that provide funding for flood relief in Eastern Kentucky.

The bills are identical and are making their way through each chamber so that the session can be wrapped up in three days. Legislators clarified during committee meetings that these bills are the first steps to providing relief to eastern Kentucky, and additional funding will likely be considered during the 2023 regular session once needs are more fully assessed.

The bills include immediate relief for eastern Kentucky counties affected by the flooding that occurred in July and more flexibility for the Western Kentucky relief fund established during the 2022 regular session. 

Relief for eastern Kentucky flood counties

The bills establish the Eastern Kentucky State Aid Funding for Emergencies (EKSAFE) fund to be administered by the Division of Emergency Management. The fund will provide financial assistance and support to counties named in the federal disaster declaration. 

Eligible recipients of EKSAFE funds include counties, cities, nonprofit or public utility service providers, state agencies and school districts. 

The funds can’t be used to cover any new construction inside the 100-year floodplain area. Funds may be used to provide advancements to counties experiencing strained finances while awaiting reimbursement from FEMA or insurance claims.

The bills appropriate $200 million from the Budget Reserve Trust Fund Account to the EKSAFE fund to be allocated:

  • $75 million to be used by the Division of Emergency Management to provide financial assistance.
  • $40 million to be used by the Division of Emergency Management for the advancement of monies to school districts and nonprofit or public utility service providers.
  • $40 million to the Department of Education to provide financial assistance to school districts.
  • $45 million to the Transportation Cabinet for reimbursement from federal emergency disaster assistance. The bills note that this allocation may be increased.

The bills appropriate an additional $12.6 million in state American Rescue Plan Act (ARPA) funds to repair water and sewer infrastructure.

Increased flexibility for western Kentucky relief fund

The bills change the name of the SAFE fund established during the 2022 regular session to the WKSAFE fund to distinguish between the two relief funds and increase the time period for expenditures of the WKSAFE fund from June 30, 2024, to June 30, 2026. 

The bills also create greater flexibility for the WKSAFE fund to allow funds to be used for revenue loss to counties to the extent the loss is directly caused by the December tornadoes. 

This provision will help counties that lost taxable property value from the destruction of the tornadoes. Revenue loss will be determined by the Department for Local Government quarterly, and counties will be eligible for 100 percent of lost revenue in FY2023, 66 percent of lost revenue in FY2024 and 33 percent of lost revenue in FY2025. 

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