Kentucky lawmakers were back in Frankfort Tuesday for the start of a new legislative session.
One of the top priorities for the legislature is crafting the next two-year budget. This year comes with some changes, including changes at the federal level and a lower income tax rate here in Kentucky.
Both sides of the aisle want to make a budget that serves the needs of the Commonwealth but have different ideas on how to navigate the financial impacts.
Kentucky lawmakers began the 2026 session Tuesday in temporary chambers while the Capitol undergoes renovations.
The same old routine goes on, new and old faces dealing with issues old and new, including building the 2026-2028 state budget.
Republican leaders in both chambers feel confident in crafting that bill.
When the calendar turned to 2026, the state income tax rate decreased 0.5%, which will likely decrease the state’s revenue by more than $700 million.
This coincides with changes at the federal level, leaving state and local leaders to fund services like Medicaid and SNAP benefits.
Kentucky’s Legislature does have close of $4 billion in reserve funds, and the latest projections from the Consensus Forecasting Group estimate a budget shortfall of $156 million smaller than first anticipated.
The 2026 legislative session ends on April 15. That is when lawmakers have to get the budget passed and to Governor Andy Beshear’s desk.
It would then go into effect on July 1.
Source: WAVE
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