Beshear touts economic growth, weighs income tax reduction during NKY visit

BY KENTON HORNBECK AND MARK PAYNE | LINK nky REPORTERS

Gov. Andy Beshear wouldn’t say if he would veto House Bill 1, the income tax bill set to be taken up by the Senate when the Kentucky legislature reconvenes in Frankfort for the second part of the 30-day legislative session.

After recently speaking at the Government Forum for the Northern Kentucky Chamber, Beshear said he would look closely at the bill to further reduce the income tax from 4.5 to 4% on Jan. 1, 2024.

Beshear diverted attention to the sales tax — which increases in certain areas under House Bill 1 to compensate for lost revenue from reducing the income tax.

“Certainly, the best plan of action to provide people relief would be a temporary reduction of the sales tax,” Beshear said. “When we talk about inflation. It’s that things cost too much.”

Beshear, who is running for reelection, said that while the bill could potentially harm families in the long run, he will consider whether it helps families in the near future.

“While it may hurt our fiscal stability in the long run, I’m gonna have to look at how it can help our families now, so we’ll carefully consider it,” Beshear said.

The bill passed the House in early January before heading to the Senate, and codifies language from 2022’s House Bill 8, which sought to eliminate the income tax slowly.

Rep. Steve Rawlings (R-Burlington) said that the legislature could easily override a veto with supermajorities in both chambers.

Rawlings pointed out that Beshear focused on job growth and the economy in his comments, “so I would think that he would be quick to sign” the bill. At times, Beshear has said Kentucky’s economy “is on fire” and often highlights the state’s economic achievements.

The Brent Spence Bridge Corridor Project, which Beshear, along with President Joe Biden, announced funding for in January, is viewed as a key driver of economic growth in Northern Kentucky going forward.

Federal funding for the bridge came from Congress’ passage of the Infrastructure Investment and Jobs Act. $1.6 billion in federal grant money will go toward paying the estimated $3.3 to $3.8 billion price tag of the project.

When asked if he had any concerns about inflation, supply chain issues and workforce challenges relating to the remaining $2 billion needed to complete the project, Beshear remained optimistic and said he expects ground will be broken on the project later this year.

With inflation and rising construction costs, Beshear told reporters during his visit to the region that he believes the project will be completed on schedule, but likely not under budget.

“Thankfully, there’s a lot of smart people, both on the Ohio and the Kentucky side.

We already have a lead engineer that helps with the project,” Beshear said. “We believe that we can do this. We’ll get it done on schedule. We might not get it done under budget with inflation but we think we can get it done somewhere close to and we’re going to get it done without tolls regardless.”

Beshear said he toured the Amazon Air facility in Hebron Tuesday morning and came away impressed.

“I got to get a firsthand tour of that Amazon facility,” Beshear said. “Do y’all realize that the biggest investment in the history of Amazon was made right here in Northern Kentucky?”

In addition to Amazon, Beshear mentioned a number of other companies in Northern Kentucky which have invested into building larger operations and expanding their facility size. Some of those mentioned include Levi Strauss, 80 Acres Farms and Nucor Steel. Whitehorse Freight unveiled their new Crestview Hills facility Tuesday after a $5.4 million investment into their company. Last week, North American Stainless announced a $244 million investment into their Carroll County facility.

With the amount of new jobs created, Beshear acknowledged the workforce challenges the region has faced in being able to fill those jobs.

“We’ve been working with this chamber,” Beshear said. “We’ve talked about the initiatives repeatedly in a number of different ways.”

These initiatives include working with the Kentucky Community and Technical College System to ensure that specific programs are tied to employers in the region and also investing between $240 and $280 million in career and technical programs in Kentucky high schools.

Despite overall economic growth, Beshear cited the numerous unprecedented tragedies Kentucky has endured since he first took office in December 2019, specifically the COVID-19 pandemic, the Russia-Ukraine War’s effect on the national economy, western Kentucky tornados, eastern Kentucky floods and two ice storms. However, Beshear remained optimistic about the future of Kentucky.

“I truly believe we’ve moved on from that time of darkness and great difficulty and loss, into one of optimism, progress and prosperity,” Beshear said.