Legislators finalized the state budget Wednesday before adjourning for the veto recess, sending the executive branch budget (HB 500), transportation cabinet budget (HB 501), judicial branch budget (HB 504), and the one-time funding bill (HB 900) to the Governor’s desk.
Because these are appropriation bills, Gov. Andy Beshear has the authority to issue line-item vetoes. Lawmakers will return April 14–15 for the final two days of session, when they may override any gubernatorial vetoes.
Executive branch budget
The final executive branch budget, HB 500, includes across-the-board spending reductions for most state agencies, though many county-related programs were spared.
Overall, the plan delivers a mixed outcome for counties—maintaining funding in several key areas while failing to address longstanding gaps.
Reshaping the shared responsibility for county jails was KACo’s top priority this session; however, the final budget did not include significant increases in jail funding. The bill only includes a $1.5 million increase in the program completion and sentencing credit program from $12 million each year to $13.5 million each year. This program exhausted its funds last year at the previous $12 million level.
The court security officer reimbursement rate also remained stagnant at $15 per hour.
In addition, prior biennium funding assistance for audit costs were not continued. The final budget did not include funding for the outlier audit program, nor did it provide support to maintain county clerk and sheriff audits at the 50% cost level.
There were, however, some bright spots in the budget. Funding for 911 was increased, including $5 million each year for the completion of NextGen 911, and the body armor grant program continued at $10 million each year.
The budget also included 2% raises each year for most state employees. However, county attorneys, commonwealth’s attorneys, and their staff were excluded from the salary increment in the final version of the budget.
Other provisions in HB 500:
- Requires all PVAs to utilize the statewide aerial imagery and mapping program, KyFromAbove, as the source for aerial mapping and imagery services by June 30, 2028.
- Requires the Department of Military Affairs to provide a comprehensive list of anticipated FEMA reimbursements to counties by June 1, 2026.
Transportation cabinet budget
The transportation cabinet budget, HB 501, includes significant new investments in county road funding through both increased support for existing programs and the creation of new funding opportunities.
A full summary of the transportation budget’s county impact is available here.
Judicial branch budget
The final judicial branch budget, HB 504, includes slightly more funding than earlier House and Senate versions. Key provisions include:
- 2% raises in each year of the biennium for court personnel, including deputy circuit court clerks.
- A requirement that courts use video arraignment when available.
If a court does not use video arraignment when the system is available, the Administrative Office of the Courts (AOC) will be responsible for the costs associated with transporting prisoners to and from arraignment.
The budget further requires AOC to prepare a report on the utilization of the video arraignment system, including any impediments that may be reducing its use, with the data broken down by courtroom and judge. The report must be submitted to the Interim Joint Committee on Appropriations and Revenue by Oct. 1, 2027.
One-time funding bill
The General Assembly also passed a one-time funding bill, HB 900, with funds from the state’s Budget Reserve Trust Fund. The bill includes$1.77 billion in one-time investments over the biennium.
Included in the bill is funding for many grant programs available to counties:
- $45 million each year for Kentucky Water and Wastewater Assistance for Troubled or Economically Restrained Systems (KWWATERS) Program.
- $25 million each year for continuation of the Kentucky Product Development Initiative (KPDI).
- $50 million each year for the Government Resources Accelerating Needed Transformation (GRANT) fund.
The bill also includes one-time funding for multimodal transportation infrastructure, including $11.4 million in FY27 for general aviation airports and $15.1 million in FY27 and $14.5 million in FY28 for public riverports.
In addition, the bill includes line-item funding for many specific county projects. A full list of funded projects is available here.
Photo: Rep. Jason Petrie presents House Bill 500, an act related to the executive branch budget, on the House floor Wednesday. Photo by LRC Public Information.
