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KY Counties See Dark Days Ahead as Tax Revenue Drops

Experts say federal aid to Kentucky was essential for curbing the economic fallout from the Great Recession. (Adobe Stock)
Experts say federal aid to Kentucky was essential for curbing the economic fallout from the Great Recession. (Adobe Stock)
April 30, 2020

BOWLING GREEN, Ky. -- Counties across Kentucky say they've already seen a drop in tax revenue due to the COVID-19 crisis, and are bracing for cuts to law enforcement, transportation and other critical public services.

Early indicators hint that the economic fallout from the global pandemic could be worse than the Great Recession of 2008.

So far, nearly a half million Kentuckians have filed unemployment claims, around a quarter of the state's workforce.

Warren County Attorney Amy Milliken says tax revenue from the tourism industry in the Bowling Green area has vanished.

"We have lost and are going to lose about $40,000 or $50,000 worth of revenue just for our park system," she states. "That really trickles down through county government into the private business sector -- because then, our hotels are not full, our local eateries are not utilized."

Gov. Andy Beshear says beginning this Friday, some local county governments and public safety agencies may be eligible to apply for a portion of more than $9 million in grant funding.

It's part of the U.S. Justice Department's Coronavirus Emergency Supplemental Funding Program.

Milliken says it's also likely all of the state's 120 counties will feel the ripple effects of historic drops in the demand for oil.

"We are all going to see reductions in gas tax, and when that is reduced, our road fund gets reduced," she states. "So, the state money coming to each county is going to be affected. We will have less money to improve our county roadways."

During the Great Recession, the federal government padded Kentucky's budget with more than $3 billion.

According to the Kentucky Center for Economic Policy, the additional funding was essential to prevent the recession from sliding into a depression.

Nadia Ramlagan, Public News Service - KY