Gov. Beshear: Kentucky Just Reported the Highest Annual Growth Rate in 31 Years

Governor delivers the highest and now the second-highest revenue surpluses in state history

FRANKFORT, Ky. (July 11, 2022) – Kentucky’s record-breaking economic momentum continues as Gov. Andy Beshear today announced that Kentucky’s fiscal year 2022 General Fund receipts grew at the highest rate in 31 years.

The Office of State Budget Director reported 14.6% growth over last year and noted that General Fund receipts totaled $14.7 billion, exceeding the budgeted estimate by $945.4 million. This is the second-highest revenue surplus ever – surpassed only by last year’s record amount – and the budget surplus is expected to be even higher once the books are closed on spending later this month.

“One of my most important jobs as Governor is to ensure the financial strength and solvency of our great commonwealth – essentially to make sure our financial house is in order,” Gov. Beshear said. “These receipts show that personal income, sales and business income are all going up significantly, and even our road fund is up. My administration has now delivered the highest and second-highest revenue surpluses in the history of Kentucky, thanks to strong fiscal management and a hot, record-breaking economy.”

The Governor also noted that, once the books are closed later this month, the state’s Rainy Day fund is expected to reach almost $2.7 billion. When Gov. Beshear took office, that fund was at $129 million.

“We’re seeing more jobs and better wages for Kentuckians, which allow more people to put food on the table and live the lives they want and deserve,” Gov. Beshear said.

To read the Office of State Budget Director’s report, click here.

Recent Economic Momentum
Today’s news further highlights the continued economic momentum in the commonwealth as the state builds back stronger from the effects of the pandemic.

In 2021, the commonwealth shattered every economic development record in the books. Private-sector new-location and expansion announcements included a record $11.2 billion in total planned investment and commitments to create a record 18,000-plus full-time jobs across the coming years. Kentucky’s average incentivized hourly wage for projects statewide in 2021 was $24 before benefits, a 9.4% increase over the previous year.

In the past year, the Beshear administration announced the two largest economic development projects in Kentucky’s history. In September 2021, Gov. Beshear and leaders from Ford Motor Co. and SK Innovation celebrated a transformative $5.8 billion investment that will create 5,000 jobs in Hardin County. And in April of this year, the Governor was joined by leadership at Envision AESC to announce a $2 billion investment that will create 2,000 jobs in Warren County. These announcements solidify Kentucky as the EV battery production capital of the United States.

This strong economic momentum has carried over into 2022, with both S&P Global Ratings and Fitch Ratings upgrading Kentucky’s financial outlook from stable to positive in recognition of the commonwealth’s surging economy.

And Site Selection magazine placed Kentucky at 6th in its annual Prosperity Cup rankings for 2022, which recognizes state-level economic success based on capital investments.

In April, the state reported a 3.9% unemployment rate, which was the lowest rate ever recorded. In May, the rate fell to a new record low of 3.8%.

Relief to Help Families Save
While the state’s economy is booming, the Governor understands that Kentucky families are still impacted by record gas prices and higher costs of consumer goods, and he is working to provide relief. To help families the Governor has recently:

  • Issued an executive order declaring a state of emergency and activating the state’s price gouging laws to protect families from grossly overpriced gasoline and motor fuels.
  • Issued an executive order to freeze vehicle taxes for two years at the January 2021 assessed value due to the pandemic-related rise in used car values, saving Kentuckians approximately $340 million in property tax reductions.
  • Stopped a 2-cents-per-gallon hike in the state’s gas tax that would have taken effect on July 1 and that would have resulted in a price hike on both regular and diesel fuel.
  • Issued an executive order declaring a state of emergency over the baby formula shortage that has impacted the nation and the commonwealth.

The Governor also supported legislation to cut the state sales tax from 6% to 5% temporarily, which would have saved Kentuckians $873 million in relief directly related to sales tax savings if the General Assembly had passed the measure.

He joined other Governors to send a letter to Congressional leadership asking them to pass federal legislation to suspend the federal gas tax until the end of the year. And he recently sent letters to the top administrators at the U.S. Environmental Protection Agency requesting they grant a waiver removing a requirement that more costly, “reformulated” fuel be sold in many urban areas and asking for a waiver that would allow cheaper butane to be used as an additive blend for gasoline.

Gov. Beshear continues to outline five assistance programs that Kentuckians should research to see if they could financially benefit their families.