Democratic Gov. Andy Beshear said Thursday there’s “enough credit to go around” for Kentucky’s record-setting budget surpluses during his tenure, as he delved into economic issues amid Republican attacks over surging nationwide inflation that’s squeezing household budgets.
Beshear acknowledged the “challenging present” caused by escalating consumer prices, but said the causes are “more complex than a political talking point.” He continued pointing to economic development gains that he said are positioning Kentucky to offer unprecedented opportunities.
On Monday, Beshear’s administration reported that Kentucky’s General Fund receipts in the past fiscal year grew at the highest rate in 31 years. The General Fund pays for most state services, including education, health care and public safety. The surge left the state with its second-largest surplus ever, surpassed only by last year’s amount, the state budget director reported.
Beshear, who is seeking a second term in next year’s election, heralded it as another sign of the Bluegrass State’s economic momentum under his stewardship.
Republican House Speaker David Osborne pushed back, saying the massive budget surplus was the result of the GOP-dominated legislature’s “sound fiscal policies and responsible tax reforms.”
At his weekly news conference on Thursday, Beshear was asked to what extent GOP supermajorities in the legislature — which passed the state budgets — deserved credit for the bulging surpluses.
The governor replied that there’s “enough credit to go around. I’m not worried about sharing it.”
“We get into this ‘D’ or ‘R,’ or red or blue or left or right,” he added. “I’m just focused on moving this state forward. So anybody wants to take a little bit of credit … that’s fine. I think the facts are pretty clear that under this administration we have the two largest budget surpluses ever.”
Beshear is expected to make his management of the state’s economy a cornerstone of his campaign message. Kentucky last year posted records for job creation and investments and recently posted its lowest-ever unemployment rates. The state’s two largest-ever economic development announcements — related to battery production for electric vehicles — have come during his term.
But Republicans already involved in next year’s gubernatorial race are trying to link the governor to Democratic President Joe Biden’s handling of the economy. Recent polling showed the governor receiving high job-performance ratings from Kentuckians, but Beshear faces a tough reelection fight in a state trending heavily toward Republicans.
State Rep. Savannah Maddox, among the GOP gubernatorial hopefuls, spoke out this week after reports that U.S. inflation surged to a new four-decade high in June. Contrasting that news with the governor’s assessment of Kentucky’s economy, Maddox said it showed “just how out of touch Beshear’s administration is with reality” as many Kentuckians struggle to make ends meet.
Beshear on Thursday acknowledged the ongoing hardships, but also pointed to glimmers of improvement. He said prices have dropped for some food goods, and noted that gas prices have fallen by 50 cents a gallon, on average, over the last month in Kentucky.
After years of low prices, a swift rebound from the 2020 pandemic recession — combined with supply-chain disruptions — ignited inflation. Beshear also pointed to economic repercussions from Russia’s invasion of Ukraine.
“It’s more complex than a political talking point,” the governor said. “There is no one thing you can point to that any party did that caused inflation.”
U.S. Senate GOP leader Mitch McConnell, the state’s most powerful Republican, blames Democratic policies for inflation’s relentless surge. In a Senate speech Wednesday, McConnell said it was “fueled directly by the reckless spending spree that Democrats rammed through on party lines last year.”
Meanwhile, Beshear continued urging struggling Kentuckians to reach out for assistance. He announced a one-stop website to access available resources at governor.ky.gov/tipstosave.
The governor also said the state real property tax rate has decreased, dropping from 11.9 cents to 11.5 cents per $100 assessed value. It’s the second annual decrease in the real property tax rate, the governor’s office said. The state revenue department is required by statute to set the real property tax rate each year by July 1.