The Kentucky House Committee on Appropriations and Revenue met on Tuesday, March 10, and heard several budget proposals.  

House Bill 501- House Transportation Budget  

The Commonwealth’s Transportation budget, HB 501, increases funding for the Local Assistance Road Program (LARP) in both fiscal years. Funding increased in FY 2026-27 to $68.2 million (from $19.2 million) and in FY 2027-28 to $28.6 million (from $18.2 million). The state share from the state gas tax, the Municipal Road Aid (MRA), was unchanged and provides $54.3 million in FY 2026-27 and $57.3 million in FY 2027-28. Included were appropriations for line items such as an online insurance verification system, street-legal-special-purpose vehicles, Kentucky Information Network for Driver Licensing (KINDL) debt and maintenance, and KAVIS upgrades. Language pertaining to single bid contracts and reporting for the services provided at regional driver licensing offices was also included. 

Read the full bill text here. 

House Bill 502- Two-Year Road Plan 

The Commonwealth’s 2026-2028 Biennial Highway Construction Plan provides a list of projects by county included in the plan. Unlike prior budgets, the Kentucky House opted to fund only the projects the Commonwealth currently has funding for, and at 92% of costs to create a cushion for potential cost overages or underestimates in project costs. As a result, the plan provides $481 million in funding of $490 million in total project costs within the plan. 

Read the full bill text here.  

House Joint Resolution 75- Six-Year Road Plan  

HJR 75 outlines the Commonwealth’s six-year road plan project list by county. The total appropriations within the plan are $5.2 million in FY 2029, $25.3 million in FY 2030, $24 million in FY 2031, and $2 million in FY 2032. 

Read the full resolution text ​here.  

House Joint Resolution 76- LARP List 

HJR 76 outlines the Commonwealth’s Local Assistance Road Program (LARP) project list by county. The total appropriations are $68.3 million in FY 2027. 26RS HB 501 fully funds these projects.  

Read the full resolution text here.  

House Bill 757- House Revenue Bill 

HB 757 is the House revenue bill. The legislation sunsets the state’s three TIF programs beginning on the effective day of the act. However, the sunset language only applies to new TIF projects and all projects that are currently under one of the state’s TIF programs will not be impacted.  The House did not include language that will permanently fix currently enacted TIFs that are impacted by the lowering of the state’s income tax. The bill also provides clean-up language for 25RS HB 606 from the prior session relating to regional economic development districts. It clarifies that city participation in a district is optional and that written notice is required to all local governments with territory within the boundaries of the region. Importantly, the amendments clarify that the provisions do not limit the authority of a city with territory within a district to levy and collect an occupational license tax unless the city has voluntarily joined the district and agreed to the imposition of the district’s occupational tax.  

Read the full bill text here.  

House Bill 647- GRANT Program 

HB 647, as amended, will increase the local match requirements for the Government Resources Accelerating Needed Transformation (GRANT) Program. The following local match requirements will apply to eligible projects based on the criteria set out in KRS 154.14-050. 

Read the full bill text here.  

House Bill 869 – Regional Economic Development Incentives 

HB 869 establishes an economic development tax credit against state income taxes imposed in a heritage county. A heritage county is determined by a combination of two factors: the population density ranking of the county and the ten-year percentage change in population ranking. Lower scored counties will qualify as heritage counties. The proposed bill specifies the eligibility criteria for the projects, such as the number of employees for a project, to be eligible to receive the tax credit, the total amount of eligible funds for a project, and outlines reporting requirements. The tax credit can be up to 1.5% of the wage paid to full-time employees who are subject to the tax and are maintained at a project located in a heritage county. The total cumulative amount of the credit claimed shall not exceed $2 million per taxable year or the annual maximum approved costs of the project. Finally, the proposed legislation amends the maximum funding available for development projects under the KPDI program to $2.4 million for heritage counties and $2 million for all other counties. HB 869 also directs the Cabinet for Economic Development to work closely with KCTCS to promote the jobs created because of the economic development programs and provide support for the retention and placement of students into new job and workforce training opportunities within the state. 

Read the full bill text here.  

All bills received final passage from the House and are awaiting action in the Senate.