# Bluegrass Institute > Freedom-forward Ideas for the Commonwealth of Kentucky Public Ghost content for AI and LLM tooling. This file includes a bounded export of public pages first, then recent public posts. Append `.md` to any post or page URL to get the content in Markdown (for example, `/example-post.md`). ## Pages ### About the Bluegrass Institute URL: https://www.bluegrassinstitute.org/about/ Last updated: 2026-07-11T16:20:04.000Z > **Vision: A Kentucky where liberty thrives, government is restrained, and free enterprise drives prosperity.** > **Mission: The Bluegrass Institute works with Kentuckians, pro-liberty coalitions, grassroots organizations and business owners to advance freedom and prosperity by promoting individual liberty, limited and transparent government, and free markets.** Founded in 2003, the Bluegrass Institute is a donor-supported nonprofit, nonpartisan organization dedicated to transforming the commonwealth into a beacon of freedom and opportunity. Working with pro-liberty coalitions, grassroots organizations and business owners, we advance freedom and prosperity by promoting individual liberty, limited government, and free markets. We operate independently of government funding and are affiliated with the State Policy Network. ### KY Public School Districts: Facts & Trends URL: https://www.bluegrassinstitute.org/ky-public-school-district-facts-trends-summary/ Last updated: 2025-09-08T21:48:29.000Z _No content available._ ### Learn More URL: https://www.bluegrassinstitute.org/get-involved/ Last updated: 2026-07-03T00:34:38.000Z ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/08/capitol_tulips.jpg) ## Advance policies that elevate liberty and prosperity in the Bluegrass State Subscribe to get regular updates about our work advancing individual liberty, limited government and free markets in the commonwealth. [Subscribe](#/portal/signup/free) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/09/krakenimages-Y5bvRlcCx8k-unsplash.jpg) ## Fuel Kentucky’s future of freedom Our partners help us create new opportunities in our beloved Old Kentucky Home. ****Learn what you can do to help advance freedom-forward policy.** [Donate Online Today](https://www.bluegrassinstitute.org/donate/) ## Prefer to mail your gift? Partner with us by mailing your donation. Your contribution is an investment in our efforts to advance free-market solutions for Kentucky’s future. Bluegrass Institute P.O. Box 1073 Shelbyville, KY 40066 **Tax ID #11-3691843* ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/07/scott-graham-5fNmWej4tAA-unsplash.jpg) ## Multiply your impact with a gift of stock Maximize your tax benefits and drive meaningful change in Kentucky by donating appreciated securities. ****For more information on the benefits of giving stock, e-mail us:** [****contact@bluegrassinstitute.org**](mailto:contact@bluegrassinstitute.org)****.** [Learn How to Give Stock](https://stockdonator.com/stock-information/?oid=cef476f6&ref=bluegrassinstitute.org) ### Staff Members URL: https://www.bluegrassinstitute.org/staff-members/ Last updated: 2025-11-22T08:58:47.000Z ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/08/4D0CBD86-3330-478A-A1AE-2D404C54CDB9-1.jpeg) #### Caleb O. Brown Chief Executive Officer [Profile](https://bluegrass-institute.ghost.io/author/calebobrown/?ref=bluegrassinstitute.org) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/07/1fdf4a_160a30fc27a348ce9b77cbffea88fa64-mv2.png) #### Cindy Kilduff Development Advisor ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/07/1fdf4a_3ea15dd23aa442d686ebde86e95659ca-mv2.png) #### Ethan Tackett Development Coordinator ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/11/image-1.png) #### Joseph L. Verruni Operations [Profile](https://www.bluegrassinstitute.org/author/joseph-verruni/) ### Home-Issues URL: https://www.bluegrassinstitute.org/home-issues/ Last updated: 2025-07-26T06:35:27.000Z _No content available._ ### School Choice URL: https://www.bluegrassinstitute.org/school-choice/ Last updated: 2025-09-07T18:37:19.000Z ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/07/7833d4_5fcf941a2c6740c990680360ab12a3e4-mv2.jpeg) ## Kentucky kids have a chance if Kentucky families have a choice Thirty-three states have nonpublic school choice programs ... Kentucky has none. Washington, D.C., has nonpublic school choice programs ... Louisville, Kentucky, has none. Puerto Rico has nonpublic school choice programs ... Kentucky has none. Forty-four states have charter schools ... Kentucky has none. Guam has charter schools ... Kentucky has none. Puerto Rico has charter schools ... Kentucky has none. Washington, D.C., has charter schools ... Louisville, Kentucky, has none. True improvement in public education is happening in other states where families can select the best fit for their children, driving innovation and accountability across the system. ****It can happen in Kentucky, too. It** ****must** **happen in Kentucky, too.** ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/07/7833d4_778e82c2f91f486596e256dec0f2228f-mv2-1.jpg) ## The Bluegrass Institute is Kentucky's leading voice for education freedom ****... at the statehouse** We provide data to assist policymakers in crafting effective policies that enhance Kentucky’s public education system, provide long-awaited alternatives for parents and prepare an educated workforce to boost Kentucky's competitiveness. Our analysts are at the table, assisting lawmakers in writing the best school-choice policy. By engaging with experts nationwide through the State Policy Network, we offer legislators the best education freedom and reform policies based on best practices of states whose families have enjoyed choices for decades. Kentucky students deserve the same opportunities. ****… and the courthouse** We’ve partnered with free-market-minded attorneys to ensure politicians don’t violate Kentucky’s nationally recognized open records and meetings policies. We also support lawmakers when they do the right thing, including filing amicus briefs defending the constitutionality of school-choice legislation they pass. ****... in the media** By packaging our research and policy ideas into media-friendly releases, we’re reaching more Kentuckians than ever with the need for – and the truth about – school choice while exposing the public-education establishment’s failure and fearmongering. Op-ed published by newspapers statewide. Debates on KET’s statewide television network. Quotes on the evening news. Educational segments on talk radio. …We're the media’s go-to source for advancing true education reform for Kentucky’s schools and more opportunities for our commonwealth’s students. We’ve shifted the narrative. When we opened our doors in 2003, Kentucky’s media coverage of education was dominated by the establishment’s push for increased taxpayer funding for a failing system. Today, the conversation centers on outcomes, spending, and choice – fueled by the Bluegrass Institute’s intellectual ammunition. ****…in the marketplace** We don’t draft dense white papers containing important data nobody knows about because they sit unread. Instead, we’re empowering Kentucky families, policymakers and stakeholders with the tools and information to choose the best educational paths for their children. Our School District Performance Tracker makes district spending, academic results and teachers’ compensation transparent, policy briefs and one-pagers inform policymakers about the latest academic outcomes in states with school choice options, collaborative events help us build a strong coalition of school-choice partners and allies and speaking engagements to civic organizations help raise the Bluegrass Institute’s profile. Additionally, we’re growing our presence on social media to share these resources, connect with families across the commonwealth and amplify our mission. Join us online to stay informed and help expand our influence as Kentucky’s education policy leader. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/09/shutterstock_1749702968.jpg) ### Pension Reform URL: https://www.bluegrassinstitute.org/pension-reform/ Last updated: 2025-09-08T21:43:02.000Z ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/07/Untitled-design---2024-03-25T102349_876.png) ## **'If you find yourself in a hole, stop digging.' -Will Rogers* Kentucky faces one of the nation's most severely underfunded public pension systems. We maintain that past pension commitments to retirees must be honored, despite the significant cost to the state. However, future benefits must be affordable, protect taxpayers and require beneficiaries to take greater responsibility for their own financial futures. No other issue better highlights the Bluegrass Institute's role in educating policymakers and the impact of making government transparent and accountable to citizens. By educating policymakers about how previous legislators from both parties leveraged public retirement systems to gain political favor with state workers through unaffordable - and unsustainable - benefits, and by insisting politicians’ pensions be subject to the Kentucky Open Records Act, we have fostered an environment conducive to meaningful reform. In 2021, the Bluegrass Institute's pension-reform proposal influenced legislation that established a new pension system for new teachers. This innovative approach combines defined-benefit and defined-contribution elements, ensuring Kentucky's teachers receive robust retirement benefits while safeguarding taxpayers from additional unfunded pension liabilities. [Explore All Insights](https://www.bluegrassinstitute.org/tag/pension-reform/) ### Our Work URL: https://www.bluegrassinstitute.org/home-support/ Last updated: 2025-09-08T21:33:16.000Z ![CTA Image](https://bluegrass-institute.ghost.io/content/images/2025/07/abstract-shape--12-.png) ****TRANSPARENCY** We expose the reality of government programs and policies through research, impact studies, open records requests and timely reporting on legislation related to our free-market objectives. ![CTA Image](https://bluegrass-institute.ghost.io/content/images/2025/07/abstract-shape--8-.png) ****TOOLS FOR ACTION** We empower constituents with fact-based data and educational resources to advance policy outcomes that promote human flourishing and defend individual liberties. ![CTA Image](https://bluegrass-institute.ghost.io/content/images/2025/07/abstract-shape--10-.png) ****ACCOUNTABILITY** We hold our elected officials accountable for proposals and votes on legislation affecting free-market policies and Kentuckians' individual liberties. ### Our Policy Pillars URL: https://www.bluegrassinstitute.org/our-work/ Last updated: 2026-07-23T14:15:42.000Z Our mission is anchored in advancing individual liberty, limited and transparent, government, and free markets through core policy pillars to promote lasting reform and unlock opportunity for all Kentuckians. ### [Educational Freedom](https://www.bluegrassinstitute.org/tag/education-freedom/) Every child deserves a high-quality education tailored to their needs. We champion choice, innovation, and accountability in education, empowering families and students to succeed. ![woman in black long sleeve shirt sitting in front of silver macbook](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/09/photo-1584697964358-3e14ca57658b.jpeg) Photo by [Annie Spratt](https://unsplash.com/@anniespratt?ref=bluegrassinstitute.org) / [Unsplash](https://unsplash.com/?utm%5Fsource=ghost&utm%5Fmedium=referral&utm%5Fcampaign=api-credit) **Key Priorities:** - Expand public and private education options. - Protect parental rights in education. - Promote charter schools and other innovative models. - Strengthen Kentucky's interdistrict transfer policies. - Ensure educator accountability for results. ### [Economic Competitiveness](https://www.bluegrassinstitute.org/tag/economic-competitiveness/) Kentucky must lead – not lag – in economic growth and innovation. We promote policies that boost economic freedom and enhance Kentucky's competitiveness by reducing government overreach, lowering taxes, cutting red tape, and eliminating wasteful spending to create a thriving environment for all Kentuckians. ![a large building under construction with scaffolding](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/09/photo-1673135957576-e450d4287e89.jpeg) Photo by [Jon McCallon](https://unsplash.com/@houseblend?ref=bluegrassinstitute.org) / [Unsplash](https://unsplash.com/?utm%5Fsource=ghost&utm%5Fmedium=referral&utm%5Fcampaign=api-credit) **Key Priorities**: - Increase access to diverse, affordable housing. - Provide regulatory relief for entrepreneurs, energy producers, and healthcare providers. - Reform Kentucky's tax code to encourage investment and jobs. - Enhance transparency in government spending. - Remove barriers to workforce participation. ### [Criminal Justice Reform](https://www.bluegrassinstitute.org/tag/criminal-justice-reform/) A fair and effective justice system is vital for a free society. We support reforms that uphold individual rights, enhance public safety, reduce recidivism, and eliminate wasteful policies, fostering liberty, justice, and opportunity. ![worm eye view of white concrete pillar during day time](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/09/photo-1454006639960-af9b6a303eae.jpeg) Photo by [Yume Photography](https://unsplash.com/@macu%5Fic?ref=bluegrassinstitute.org) / [Unsplash](https://unsplash.com/?utm%5Fsource=ghost&utm%5Fmedium=referral&utm%5Fcampaign=api-credit) **Key Priorities:** - Promote sentencing reform and alternatives to incarceration. - Ease reentry barriers for former offenders. - Ensure transparency and accountability in law enforcement. - Support proven practices to lower crime, reduce recidivism and increase safety. These pillars form the foundation of a freer, more prosperous Kentucky. The Bluegrass Institute is dedicated to transforming these principles into real-world policies that ensure liberty, limited government, and thriving free enterprise. ### Events URL: https://www.bluegrassinstitute.org/events3/ Last updated: 2025-09-11T01:07:06.000Z _No content available._ ### Board of Directors URL: https://www.bluegrassinstitute.org/board-members/ Last updated: 2025-12-15T12:46:13.000Z ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/07/ezgif-1a20df3cd8ec1b.png) #### Aaron P. Ammerman Cofounder, Alpha Financial Partners ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/07/7833d4_6af9088bc7da4eb580eed8e17a0f45d2-mv2.png) #### Chris Anderson American Trust Company ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/08/4D0CBD86-3330-478A-A1AE-2D404C54CDB9-1.jpeg) #### Caleb O. Brown CEO, Bluegrass Institute [Profile](https://bluegrass-institute.ghost.io/author/calebobrown/?ref=bluegrassinstitute.org) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/07/7833d4_767cb024b20d4f8d91e7b7805950a7cc-mv2.png) #### John Garen Emeritus Professor, University of Kentucky ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/07/1fdf4a_3945a1b8e506435bbbf9d8efcb3d56c1-mv2.png) #### Jenean Hampton 57th Lt. Governor of Kentucky (2015-2019) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/07/1fdf4a_bba0b809d35a4707a6aa8df16892865e-mv2.png) #### Caleb Taylor Virginia Institute for Public Policy ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/07/7833d4_1c36c95aac624e8bbac213a2b8a2d83c-mv2.png) #### Kyle Whalen Owner, BACK Construction ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/07/7833d4_359a61ec0bdc4a25b4f45bdbfe59213e-mv2.png) #### Tim Yessin Vice President, WealthSouth ### Scholars URL: https://www.bluegrassinstitute.org/scholars/ Last updated: 2026-03-28T05:04:07.000Z ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/09/Alger-1.jpg) #### Vicki Alger Education Choice Researcher [Profile](https://www.bluegrassinstitute.org/author/vicki-e-alger/) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/09/Cavanaugh-1-1.jpg) #### Jaimie Cavanaugh Regulatory Policy Analyst [Profile](https://www.bluegrassinstitute.org/author/jaimie-cavanaugh/) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/09/Angela-C.-Erickson-1.jpg) #### Angela C. Erickson Scholar [Profile](https://www.bluegrassinstitute.org/author/angela-erickson/) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/09/Franz-1-1.jpg) #### Caleb Franz Historian [Profile](https://www.bluegrassinstitute.org/author/caleb-franz/) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/09/Gardner-1.jpg) #### Charles Gardner Scholar [Profile](https://www.bluegrassinstitute.org/author/charles-gardner/) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/07/7833d4_767cb024b20d4f8d91e7b7805950a7cc-mv2.png) #### John Garen Economist [Profile](https://www.bluegrassinstitute.org/author/john-garen/) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/10/Ginn-1.jpg) #### Vance Ginn Economist [Profile](https://www.bluegrassinstitute.org/author/vance-ginn/) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/07/ezgif-1c963498c4f2d4.png) #### Stephan F. Gohmann Economist, University of Louisville [Profile](https://www.bluegrassinstitute.org/author/stephan-gohmann/) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/08/snag_69de7c25.png.png) #### M. Nolan Gray Housing Reform Researcher [M. Nolan Gray](https://www.bluegrassinstitute.org/author/mnolangray) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/10/Abigail-Hall-1-1.png) #### Abigail R. Hall Economist [Profile](https://www.bluegrassinstitute.org/author/abby-hall/) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/07/ezgif-1bf5d854bda413.png) #### Gary W. Houchens Educational Leadership [Profile](https://www.bluegrassinstitute.org/author/gary-houchens/) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/08/1fdf4a_9996b3ada47941de9e52eb98d4bf18d1-mv2.png) #### Richard G. Innes Education Analyst [Profile](https://www.bluegrassinstitute.org/author/richard-innes/) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/03/2025-05-16-Cato-Institute-Akiva-Malamet--10-1-1.jpeg) #### Akiva Malamet Scholar [Profile](https://www.bluegrassinstitute.org/author/akiva-malamet/) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/09/dierdre-mccloskey-pic-portrait-2.jpg) #### Deirdre McCloskey Scholar [Profile](https://www.bluegrassinstitute.org/author/deirdre-mccloskey/) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/07/1fdf4a_9aa7d6566ff246f8999d018b78d2f02e-mv2.png) #### Luke Milligan Criminal Justice Researcher [Profile](https://www.bluegrassinstitute.org/author/luke-milligan/) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/09/Mozena-1-1.jpg) #### John Mozena Economic Development Analyst [Profile](https://www.bluegrassinstitute.org/author/john-mozena/) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/10/CSMFO_5498f-3-1.jpeg) #### Mark Moses Scholar [Profile](https://www.bluegrassinstitute.org/author/mark-moses/) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/07/ezgif-1247731e8aa1c7.png) #### D. Eric Schansberg Economist [Profile](https://www.bluegrassinstitute.org/author/eric-schansberg/) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/09/Schwalbach-2.jpg) #### Jude Schwalbach Policy Analyst [Profile](https://www.bluegrassinstitute.org/author/jude-schwalbach/) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/09/7833d4_13dd10ae6b9941d9921480b5ea6bdc63-mv2.jpg) #### William F. Smith Pension Policy Analyst ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/09/Edward-Timmons-2016-web-profile-crop-1.jpg) #### Ed Timmons Regulatory Policy Analyst [Profile](https://www.bluegrassinstitute.org/author/edward-timmons/) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/09/ryan-young-profile-2.jpg) #### Ryan Young Economist [Profile](https://www.bluegrassinstitute.org/author/ryan-young/) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/02/image-2-2-1.png) #### Joseph L. Verruni Energy Policy Fellow [Profile](https://www.bluegrassinstitute.org/author/joseph-verruni/) ### Upcoming Events URL: https://www.bluegrassinstitute.org/events/ Last updated: 2025-09-11T01:16:35.000Z _No content available._ ### News Releases URL: https://www.bluegrassinstitute.org/media-releases/ Last updated: 2025-09-14T00:58:35.000Z Sign up below to receive news releases: You may unsubscribe at any time. ### Donate URL: https://www.bluegrassinstitute.org/donate/ Last updated: 2025-09-05T15:22:12.000Z ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/08/krakenimages-Y5bvRlcCx8k-unsplash.jpg) ## Fuel freedom and opportunity across Kentucky! Your donation enables the Bluegrass Institute to champion free-market solutions, ignite innovation and inspire Kentuckians to reclaim and protect their liberties. **The Bluegrass Institute is a 501(c)(3) nonprofit, nonpartisan research and education organization. Your donation is tax-deductible to the extent allowed by law.* ### calebobrown URL: https://www.bluegrassinstitute.org/calebobrown/ Last updated: 2026-06-22T21:13:04.000Z ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/08/4D0CBD86-3330-478A-A1AE-2D404C54CDB9.jpeg) ## Caleb O. Brown Caleb O. Brown is the Chief Executive Officer of the Bluegrass Institute. Caleb comes to the Bluegrass Institute from the libertarian Cato Institute in Washington, D.C. where he was director of multimedia and host and executive producer of the [Cato Daily Podcast](https://www.cato.org/podcast?ref=bluegrassinstitute.org), the institute’s lead public-facing product. He hosted the podcast for nearly 18 years, producing well over 4,000 episodes of daily interviews with policymakers, scholars and journalists. For his consistency and wide-ranging knowledge of policy issues, Brown was dubbed “The Voice of Liberty” by the late longtime Cato Institute leader and Kentucky native David Boaz. In 2005, Caleb directed the KentuckyVotes.org project for the Bluegrass Institute, which successfully pressured the state’s Legislative Research Commission to publish bill summaries and daily voting records online—a dramatic expansion of transparency for the commonwealth’s legislative branch. Caleb’s journalism background includes service to 840 WHAS-AM, **Snitch Newsweekly*, and WLKY in Louisville. His commentary has appeared in **USA Today*, **The Washington Examiner, Investor’s Business Daily*, **New York Press*, and **The Washington Times*. Brown holds degrees in economics from the University of Louisville and George Mason University. [Contact Us](mailto:contact@bluegrassinstitute.org) ### Contact Us URL: https://www.bluegrassinstitute.org/contact-us/ Last updated: 2026-06-18T17:19:58.000Z Email Address Full Name Subject Message Send Message ### Caleb Franz URL: https://www.bluegrassinstitute.org/caleb-franz/ Last updated: 2025-10-21T18:52:56.000Z ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/09/Franz-2.jpg) ## Caleb Franz Caleb Franz is a writer, researcher, storyteller and nonprofit professional residing in Lexington, Kentucky. He is the author of [**The Conductor: The Story of Rev. John Rankin, Abolitionism’s Essential Founding Father*](https://www.amazon.com/Conductor-Rankin-Abolitionisms-Essential-Founding/dp/1637589891?ref=bluegrassinstitute.org). Franz’s historical writing often highlights the forgotten people, places and events that help define the American story. His expertise spans multiple eras throughout American history, but he specializes in the early republic, antebellum and Civil War periods. His work has been featured in various outlets including TIME, RealClear History, the Washington Examiner, the Independent, Religion & Liberty and Louisville’s Courier-Journal, among others. Alongside his historical writing, Franz has served as program manager at Young Voices since 2021\. In this capacity, he helps mentor young journalists and policy writers by sharpening their storytelling skills and accelerating their career trajectory through various fellowships and networking opportunities. Before this work, he served in the U.S. Army through the Ohio National Guard for six years, which included a tour in Kuwait. ### Eric Schansberg URL: https://www.bluegrassinstitute.org/eric-schansberg/ Last updated: 2025-09-19T20:09:15.000Z ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/09/846_62cda6819bbd7_element_12_5ecc5fbdf5de5bb0dbaedc1efdecc727-534-most20recent20pic-2-2.jpg) ## Eric Schansberg Eric Schansberg, Ph.D., has been professor of economics at Indiana University Southeast in New Albany, Indiana, since 1992. Schansberg, who earned his Ph.D. at Texas A&M University, has authored two books on public policy – “Poor Policy: How Government Harms the Poor” and “Turn Neither to the Right nor to the Left.” He has also written “College 101: What Students and Parents Should Know About Universities” and hundreds of articles on public policy in outlets ranging from academic journals to newspapers. He’s also co-authored “Microeconomics for Managers: Principles and Applications,” a managerial economics textbook published by Cambridge University Press. Schansberg is an adjunct scholar at the Acton Institute and a former congressional candidate who focused on issues like reducing the national debt and constitutional principles. ### Gary Houchens URL: https://www.bluegrassinstitute.org/gary-houchens/ Last updated: 2026-01-26T16:21:40.000Z ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/01/Houchens-headshot-1-1.jpg) ## Gary Houchens Gary Houchens, Ph.D., is professor and director of the Educational Leadership Doctoral Program at Western Kentucky University. He's a former teacher, principal and district administrator in both public and private K-12 education settings. Houchens, who earned his Ph.D. at the University of Louisville, has published research on the intersection of leadership and school improvement. He provides regular analysis of education policy reforms for the Bluegrass Institute, and from 2016 to 2019, he served on the Kentucky Board of Education (KBE), where he was chair of the KBE’s Curriculum, Instruction, and Assessment committee. ## Posts ### Joseph L. Verruni discusses his article on Kentucky's energy costs on WVLK's Kruser and Krew URL: https://www.bluegrassinstitute.org/joseph-l-verruni-discusses-his-article-on-kentuckys-energy-costs-on-wvlks-kruser-and-krew/ Last updated: 2026-09-03T11:29:46.000Z On WVLK's Kruser and Krew, [Joseph Verruni](https://www.bluegrassinstitute.org/author/joseph-verruni/) discusses [energy costs and the challenges posed by data centers](https://www.bluegrassinstitute.org/hl-cre-jv/). ### Flock cameras aren't 'compromise;' they're gross overreach URL: https://www.bluegrassinstitute.org/flock-cameras-arent-compromise-theyre-gross-overreach/ Last updated: 2026-09-01T16:51:24.000Z *This article first appeared in the* [Louisville Courier-Journal](https://www.courier-journal.com/story/opinion/contributors/2026/09/01/flock-camera-shively-police-officer-abuse-public-pushback-privacy-mass-surveillance/91552520007/?ref=bluegrassinstitute.org). --- When Shively Police [Officer Asad Zahir was arrested](https://www.courier-journal.com/story/news/local/public-safety/2026/08/26/shively-police-officer-accused-of-using-flock-cameras-to-harass-woman/91471283007/?ref=bluegrassinstitute.org) for improperly using [Flock Safety](https://data.aclum.org/2025/10/07/flock-gives-law-enforcement-all-over-the-country-access-to-your-location/?ref=bluegrassinstitute.org)’s Automated License Plate Reader, it added yet [another data point](https://www.aclu.org/news/privacy-technology/other-alpr-vendors?ref=bluegrassinstitute.org) to the growing list of state and local police abusing surveillance technologies. The allegations against Sahir are particularly disturbing. Over the course of five months, Zahir is accused of carrying out more than 2,000 unauthorized searches to monitor and target his ex-girlfriend. More than 240 of these searches occurred while Zahir had an active order of protection against him. Falsifying official entry logs under the guise of "narcotics investigations," Zahir, like others in state and local government, turned a tool intended to promote public safety into a personal weapon of coercion. That much is alarming. The response of the Shively Police Department and other local officials is even more troubling. While discussing the arrest, officials were quick to frame Zahir’s arrest as a triumph of internal oversight and as the direct result of individual malfeasance. Police Chief Andre Bottoms, for example, [urged the public](https://www.cnn.com/2026/08/26/us/flock-kentucky-police-officer-arrest?ref=bluegrassinstitute.org#:~:text=%E2%80%9CIt%E2%80%99s%20a%20very%20effective%20tool%20and%20we%20don%E2%80%99t%20want%20to%20be%20judged%20on%20the%20poor%20decisions%20made%20by%20one%20officer.%E2%80%9D) not to judge the technology – or the department – on the "poor decisions made by one officer." In a town hall meeting at the University of Louisville, ULPD [Chief Bryan Luckett](https://www.youtube.com/watch?v=X5ymnQkegB8&ref=bluegrassinstitute.org) described Flock as a “great investigative tool” before quipping, “I believe Flock is safe … unless you’re dating a police officer.” To those who study policing, surveillance and governmental abuses, this is a familiar refrain. Whenever state-sanctioned technologies are weaponized against citizens, public officials predictably place full blame on specific actors. ## Flock cameras aren't worth the 'compromise' Without a doubt, the individuals who abuse these technologies deserve blame and should be prosecuted. But the "few bad apples" defense conveniently shifts public attention away from much deeper problems. By solely focusing on the actions of one person, officials work to [shield broader institutional failures](https://www.americanbar.org/groups/public%5Feducation/publications/insights-on-law-and-society/volume-21/issue-1/qualified-immunity/?ref=bluegrassinstitute.org) from meaningful scrutiny. This most recent incident is far from an isolated misstep. Since 2018, there have been [176 documented instances](https://ij.org/the-ij-database-of-alpr-abuse/?ref=bluegrassinstitute.org) of ALPR abuse across the country, from [surveilling protestors](https://ij.org/the-ij-database-of-alpr-abuse/?ref=bluegrassinstitute.org) to stalking current or former romantic partners. Importantly, this number is undoubtedly understated. Defenders of these surveillance technologies point to these system's measurable benefits – helping to [recover stolen vehicles](https://epcsheriffsoffice.com/flock-safety-cameras-enable-deputies-to-quickly-recover-stolen-vehicle-arrest-criminal/?ref=bluegrassinstitute.org), [locate missing children](https://www.flocksafety.com/blog/six-abducted-children-recovered-in-five-months-in-colorado-with-flock-lpr-technology?ref=bluegrassinstitute.org) or [assist in homicide investigations](https://www.cbsnews.com/texas/news/dallas-police-flock-cameras-crime-solving-privacy-surveillance-august-2026/?ref=bluegrassinstitute.org). These successes are real, and they form the backbone of the industry's sales pitch to municipal governments. However, these benefits hide a fundamental question: should routine public safety come at the expense of our privacy, civil liberties and constitutional protections under the Fourth Amendment? For some, the answer is clear. Flock CEO Garrett Langley, for example, stated in a recent interview that, “When people talk about just one of these, privacy or safety, they're prioritizing the wrong thing, and what we have to prioritize as a country is compromise." This notion of "compromise" is a dangerous sleight of hand. Framing universal tracking as a necessary tradeoff for “safety” normalizes a model where every citizen is treated as a suspect in waiting and one that tries to pass the buck on government abuse. Apparently, Mr. Langley and Chief Bottoms are content with a “compromise” that requires over 2,000 abusive searches before an automated algorithm flags an abuse of power. This is not a safeguard; it is a monument to passive and unchecked overreach. The pushback against this network is gathering steam. [At least 56 municipalities](https://www.theguardian.com/us-news/2026/aug/20/flock-cameras-surveillance?ref=bluegrassinstitute.org#:~:text=They%20also%20worry%20about%20police%20officers%20who,at%20addressing%20concerns%20about%20privacy%20and%20misuse.) have canceled their Flock contracts. Residents across the country continue to question the constitutionality of public-private mass surveillance. The Supreme Court’s recent [*Chatrie*](https://www.supremecourt.gov/opinions/25pdf/25-112%5F0am4.pdf?ref=bluegrassinstitute.org) decision is [already raising serious constitutional questions over a just-passed Kentucky law on this subject](https://www.bluegrassinstitute.org/scotus-flock/). All of this has culminated in widespread outrage, with many instances of individuals [obstructing](https://www.motorbiscuit.com/meet-floridas-flock-blocker-the-man-who-sits-in-front-of-alpr-cameras-all-day/?ref=bluegrassinstitute.org) or [destroying](https://www.courier-journal.com/story/news/local/public-safety/2026/08/31/flock-camera-vandalism-is-surging-in-louisville-police-records-show/91446340007/?ref=bluegrassinstitute.org) these cameras. ## Pushback is forcing policymakers to listen Stopping this expansion of mass surveillance requires dismantling the institutional incentives that make public-private tracking so lucrative and low-friction. Rather than relying on voluntary corporate restraint or AI-driven post-facto police audits, the burden is on citizens to send a clear message to local, state and federal lawmakers that these actions are unacceptable. As the recent [pushback](https://www.washingtonpost.com/nation/2026/08/18/vandals-are-destroying-license-plate-cameras-amid-anger-over-surveillance/?ref=bluegrassinstitute.org) against Flock has shown, when the public makes noise, [policymakers](https://www.courier-journal.com/story/news/local/public-safety/2026/08/31/shively-pd-adds-flock-camera-safeguards-after-officer-allegedly-harassed-woman/91545288007/?ref=bluegrassinstitute.org) are forced to listen. A reasonable starting point would be placing hard [statutory limits](https://www.aclumich.org/cases/federal-court-strikes-down-nsa-warrantless-surveillance-program/?ref=bluegrassinstitute.org) on warrantless collection and retention of ALPR data and barring public entities from contracting with networks that bypass judicial oversight. At the same time, courts must continue to apply Fourth Amendment protections to persistent technological tracking, recognizing that long-term digital surveillance is functionally identical to physical trespass. The lesson of Officer Zahir's arrest is not that the system worked because an officer was eventually caught. The lesson is that when governments partner with private contractors to monitor citizens with minimal friction and oversight, the question is not *if* abuse will occur, but how gross that abuse will be. Security purchased by giving up privacy is not safety – it is *conditional* liberty waiting for the wrong person to log into the database. [*Abigail R. Hall*](https://www.bluegrassinstitute.org/author/abby-hall/) *is a scholar at the* [*Bluegrass Institute*](https://www.bluegrassinstitute.org/) *and a professor of economics at the University of Tampa. She is a native of Louisville. Patrik S. Ward is an economics student at the University of Tampa and member of the Adam Smith Society.* ### The Supreme Court has a message for Kentucky on surveillance: Get a warrant URL: https://www.bluegrassinstitute.org/scotus-flock/ Last updated: 2026-08-22T23:36:54.000Z *This piece first appeared in the* [*Kentucky Lantern.*](https://kentuckylantern.com/2026/08/12/the-supreme-court-has-a-message-for-kentucky-on-surveillance-get-a-warrant/?ref=bluegrassinstitute.org) --- Kentucky’s [new license plate camera law](https://apps.legislature.ky.gov/record/26rs/hb58.html?ref=bluegrassinstitute.org) is now in effect, and it already looks out of step with the Constitution. Just before it took effect, the U.S. Supreme Court handed the commonwealth a warning its lawmakers cannot afford to ignore. On June 29, the Court ruled in [*Chatrie v. United States*](https://www.supremecourt.gov/opinions/25pdf/25-112%5F0am4.pdf?ref=bluegrassinstitute.org) that police conduct a Fourth Amendment search when they obtain a person’s location data — even from a private company, and even for a short window of time. In *Chatrie*, that window was two hours. Writing for the Court, Justice Elena Kagan explained that an individual “has a reasonable expectation of privacy in records about his cell phone’s location,” and that the government intrudes on that protected interest “even though for only a limited time, and from a third-party tech company.” That case was about cell-phone data. But the reasoning lands squarely on the surveillance network Kentucky’s local governments have spent the last few years building through a single vendor: Flock Safety. **A statewide dragnet, city by city** Flock’s automatic license plate readers now operate in at least three dozen Kentucky law enforcement agencies, by the Electronic Frontier Foundation’s count. It’s almost certainly more, since nobody keeps a complete list and several departments have fought to keep their deployments secret. ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) Louisville Metro Police run at least 240 of the cameras, the figure a deputy chief gave the Metro Council in February with 54 more awaiting installation, and can tap more than 400 additional shared cameras across Jefferson County. Fifteen departments in Boone, Kenton and Campbell counties operate 101 devices among them. Paducah has 32\. Vine Grove, a Hardin County town of about 7,000, signed a 10-year deal last November for 10 more readers and seven other cameras, most of them already installed. Kenton County and other localities are weighing their own contracts. The cameras are not targeted tools trained on suspects. They photograph every passing vehicle, read the plate, log the time and place, and pool it all into a cloud database that agencies far beyond Kentucky can search. The Court’s own words explain why that should trouble anyone who drives. Drawing on its 2018 decision in *Carpenter v. United States*, the majority warned against surveillance that lets police reconstruct a person’s movements after the fact, enabling “tireless and absolute surveillance” of anyone, anywhere. A network of Flock cameras does to drivers what location history did to the defendant in *Chatrie*: it builds what the Court, again quoting *Carpenter*, called “an intimate window into a person’s life,” capable of showing who visited a doctor, attended a protest or went to church. The majority also dismantled the government’s favorite fallback claim. The so-called “third party doctrine” states that once you hand information to a private company, you forfeit any privacy claim to it. The Court refused to let that doctrine swallow location data, holding that such records are “not truly shared” in any ordinary sense. Kentucky agencies that route their surveillance through a private camera vendor and then treat the resulting database as fair game should read that passage closely. At least one Kentucky city has already acted on that reasoning. In July of this year, Newport ended its Flock pilot and ordered the cameras pulled. Assistant City Manager Brian Steffen said the city had reviewed *Chatrie* with its attorney and concluded that the ruling’s concerns about tracking people’s movements could become a problem for Flock. The technology worked, he said. It “just leaves too many open questions where we’re at right now.” **The gap the new law left open** This is not a hypothetical risk. In early 2025, a federal Drug Enforcement Administration agent used a Louisville Metro Police detective’s login to run roughly 150 immigration-related searches of the city’s Flock system, without the detective’s knowledge. The searches did not become public until that November, and three officers were ultimately disciplined. But that agent was a fraction of the problem. Reporters at the Kentucky Center for Investigative Reporting found [Louisville’s Flock network had been queried roughly 1,700 times](https://www.lpm.org/investigate/2025-11-03/louisville-police-share-data-with-national-immigration-dragnet?ref=bluegrassinstitute.org) with immigration-related keywords in the first half of 2025 alone, by agencies in more than a dozen states. The problem was never one rogue agent. It was a system without guardrails that made the abuse possible. Louisville’s failure was a shared password. Elsewhere the vector has been Flock’s national lookup network, which lets out-of-state and federal agencies query a city’s data without local officials knowing. The result is the same either way, and dozens of cities have now canceled or rejected Flock contracts — 47 cancellations by the count of DeFlock, which tracks the industry — with federal and immigration-agency access a leading driver. Louisville’s response to all this has not been transparency. Metro Government went to court this year to keep surveillance records secret, and in April the [Metro Council voted to keep the cameras’ locations from the public](https://www.lpm.org/investigate/2026-04-28/in-louisville-flock-camera-locations-will-stay-secret?ref=bluegrassinstitute.org). Residents cannot learn where they are being photographed, much less who has been searching for them. Kentucky lawmakers took action this year, but new privacy protections are lacking. Some provisions are counterproductive. House Bill 58, from Rep. John Hodgson, was signed into law in April and is now in effect. It caps data retention, limits government use to public safety and a handful of transportation purposes, and bars agencies from selling the data. Those provisions are worth having. But the law is a weak half-measure that ultimately carved out special exemptions letting insurers, lenders and their agents reach the data — robbing the bill of its status as serious privacy protection. It is one thing to debate whether police should hold a searchable log of every driver’s movements; it is another to route that log to private companies whose interest in it has nothing to do with public safety. That is not a loophole around the edges. It is a channel built into the statute, and it deserves far more scrutiny than it got. Most importantly, the law stops short of the one protection the Supreme Court has now made unavoidable: it does not require a warrant before law enforcement — or a federal agency piggybacking on a local system — can query historical location data. That is precisely the search the Court just held the Fourth Amendment protects. A 90-day retention limit still leaves 90 days of every Kentuckian’s movements sitting in a searchable database, reachable without a judge’s sign-off. *Chatrie* left one question for another day — whether a properly limited warrant can satisfy the Constitution’s demands for probable cause and particularity. The officers in that case, it is worth noting, had at least gone to a magistrate first. What the Court settled is the question Kentucky’s Flock contracts have been dodging: government access to your location is a search. Searches, absent some recognized exception, require a warrant. House Bill 58 does not ask anyone even to try. Kentucky’s congressional delegation has noticed the problem even if Frankfort has not. Rep. Thomas Massie said in late July that he will soon sponsor a bill to withhold federal money from municipalities and police departments that “deploy Flock (and other style) cameras to surveil law abiding citizens.” The General Assembly should not wait for Washington to move first on a surveillance network Kentucky agencies built themselves. Used with real oversight, plate readers can help solve crimes and find missing people. Lexington police credited their cameras with recovering 283 stolen vehicles and locating 22 missing people in the program’s first two years. But Kentuckians should not have to choose between public safety and the right to move freely without being tracked, catalogued and made available for inspection by any agency or corporation that asks. Privacy is not a loophole for criminals. It is a precondition for a free society, and the Supreme Court just said so in as many words. The General Assembly took a small, flawed first step. Now it should finish the job. --- *Caleb O. Brown is CEO of the* [*Bluegrass Institute*](https://www.bluegrassinstitute.org/)*.* [*Dan Canon*](https://www.dancanonlaw.com/?ref=bluegrassinstitute.org) *is a civil rights lawyer and a professor of law at the Louis D. Brandeis School of Law.* ### Kentucky school choice will benefit all students — including those in public schools URL: https://www.bluegrassinstitute.org/school-choice-benefit-all-students/ Last updated: 2026-07-30T12:55:30.000Z *This piece originally appeared in the* [*Northern Kentucky Tribune*](https://nkytribune.com/2026/06/opinion-kentucky-school-choice-will-benefit-all-students-including-those-in-public-schools/?ref=bluegrassinstitute.org)*.* --- Kentucky took an important step forward this year when the General Assembly enacted House Bill 1, which will bring school choice (finally) to Kentucky. The new law, effective July 15, allows Kentucky to participate in a federal scholarship tax credit program that could bring hundreds of millions of dollars in privately funded educational assistance into the Commonwealth without requiring an appropriation from the Kentucky General Assembly or a reduction in state funding for public schools. Unfortunately, much of the public discussion has focused on whether the program helps private schools. That debate misses a critical point: public school students can benefit from this legislation as well. The federal program works through voluntary donations. Beginning in January 2027, taxpayers may receive a federal tax credit for contributions to qualified Scholarship Granting Organizations. Those organizations then provide scholarships and educational assistance to eligible students. The funding does not come from Kentucky’s education budget. Rather, it comes from private donations incentivized by a federal tax credit. A critically important fact for Kentucky families is that the program is not limited to private-school tuition. Scholarship funds may be used for a wide variety of educational expenses, including tutoring services, textbooks, internet access, technology, and other educational supports that can directly benefit students attending public schools. Consider a public-school student who is struggling with reading comprehension or mathematics. Under traditional funding mechanisms, many families simply cannot afford supplemental tutoring. Through the new scholarship program, qualifying students may be able to obtain assistance that helps them succeed while remaining enrolled in their neighborhood public school. The same is true for families who need help paying for educational technology, online learning resources, or other academic support services. This aspect of House Bill 1 deserves much more attention. For years, discussions about school choice have often been framed as a contest between public and private education. The reality is more nuanced. Educational success is not determined solely by the school building a child attends. It is also influenced by access to tutoring, technology, enrichment opportunities, and individualized support. House Bill 1 has the potential to provide those resources to students regardless of whether they attend a public or private school. The legislation also contains income-based eligibility requirements designed to direct assistance toward families with genuine financial need. Scholarship Granting Organizations must verify eligibility and devote the overwhelming majority of their resources to scholarships and educational assistance rather than administrative costs. The goal is to help students and families, not create another layer of bureaucracy. Reasonable people can disagree about education policy. They can disagree about charter schools, vouchers, and the proper role of government in education. But House Bill 1 is different from many of those debates. It does not divert money from Kentucky’s public-school funding formula. Instead, it simply allows Kentucky families to access a federal tax-credit program that already exists. At a time when Kentucky employers consistently emphasize the need for a better educated workforce, we should welcome additional educational resources wherever they can responsibly be found. Public-school students need tutoring. Public-school students need technology. Public-school students need academic support. House Bill 1 creates a new pathway to provide those resources. We encourage public school advocates to study the federal program and take steps to deliver the substantial benefit the program can provide to public school students. Twenty-seven states have opted into the federal program, including Colorado, whose Democratic Governor said, “I would be crazy not to \[opt in\].” --- *Mark Guilfoyle is a Covington lawyer at DBL Law who serves as Chairman of the Alliance for Catholic Urban Education in Northern Kentucky. Andy Vandiver is a Kentucky business attorney and education policy advocate. For over a decade, he has written and spoken on education reform and public policy and has been involved in efforts to expand educational opportunities for families across Kentucky.* ### Don’t want data centers spiking your power bill? Let them build their own grid URL: https://www.bluegrassinstitute.org/hl-cre-jv/ Last updated: 2026-08-04T17:25:25.000Z *This piece first appeared in the* [*Lexington Herald-Leader*](https://www.kentucky.com/opinion/article316674620.html?ref=bluegrassinstitute.org)*.* --- Kentuckians are right to worry that data centers will drive up their electric bills. When a single facility demands as much power as Owensboro, someone pays for the new plants and wires that serve it. The General Assembly is still arguing over how to make sure that someone isn’t the residential ratepayer. There is a simple answer, and Kentucky law currently forbids it: let large consumers build their own grid. Data centers have been clear they are willing to finance, build, and operate their own generation—just look at [President Trump’s Ratepayer Protection Pledge](https://www.whitehouse.gov/releases/2026/03/president-trump-secures-historic-commitment-to-keep-electricity-costs-down-amid-data-center-boom/?ref=bluegrassinstitute.org). Generally, it is good public policy to get out of the way of progress if it avoids harming others, and an islanded system imposes no costs on other ratepayers, adds no strain to the regional grid, and cannot shift a dollar of stranded infrastructure onto a family in Lexington or a factory in Bowling Green, because it never touches their wires. We call this [Consumer-Regulated Electricity](https://www.cato.org/briefing-paper/case-consumer-regulated-electricity-private-electricity-grids-offer-parallel-path?ref=bluegrassinstitute.org) (CRE), and it rests on three conditions: the system must be electrically islanded from the existing regulated grid, serve only sophisticated customers who voluntarily contract for service, and obey all the other environmental and safety laws already on the books. ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) The premise of a Public Service Commission is that ordinary consumers need protections from utilities acting as natural monopolies—these grids are inherently not natural monopolies, and these consumers are multi-billion-dollar companies. Letting these large consumers trade bureaucratic protection for speed-to-market is a win for all electricity customers. Currently, Kentucky law makes consumer-regulated electricity nearly impossible. Anyone generating and selling electricity to others risks becoming a “utility”—and with that label comes the obligation to obtain a certificate of public convenience and necessity before building anything, as well as a host of other regulations. Layered on top is the 1972 Certified Territory Act, which carved the Commonwealth into exclusive service territories and gave each incumbent supplier the sole right to serve customers within its boundaries. Companies wanting to build a private power system serving several willing industrial customers aren’t just trying to start a business: they’re initiating a lopsided turf war. These statutes were not written in bad faith. Even today, most economists view the electrical grid as a natural monopoly. But this consensus goes back decades, to a time before the kind of demand generated by data centers could be fathomed. The irony is that in many ways what we are advocating for is how the power grid began: large consumers and producers building wires. It wasn’t until later that residential customers and rural areas received service. For instance, the Tennessee Valley Authority grew from a single factory connected to a single power plant. Like modern day data centers, the 1883 Southern Exposition brought its own power plant to light up Louisville brighter than New York City. The policy we are proposing has been tested in other states. Legislation in Ohio has allowed private grids to pop up in New Albany, the data center hub outside of Columbus. New Hampshire, Utah and West Virginia all have passed similar laws. Kentucky, competing for the same investment, still tells these projects to get in line. [The fix is modest](https://alec.org/model-policy/act-to-allow-for-consumer-regulated-electric-utilities/?ref=bluegrassinstitute.org). The General Assembly can exempt islanded systems serving new, nonresidential customers from the definition of a public utility and from the certified territory framework. Such systems would remain fully subject to environmental, safety, and building codes—everything except economic regulation that exists to police a monopoly these systems do not have. CRE also keeps corporate energy politics off Kentucky’s grid. Many tech companies have made environmental pledges that Kentuckians never voted for. Under CRE, a company that wants to run on solar, battery storage, and small reactors can build exactly that without retiring a coal plant, lobbying for a renewable energy portfolio standard, or pressuring existing utilities. This is also a future-proof policy. While data centers are the current concern, these policies are technology-neutral. Any large industrial consumer can take advantage of these grids, and any new technology can power them. Data centers powered by gas turbines today, nuclear-powered future tech manufacturing tomorrow. Kentucky lawmakers have already shown they want data center investment and the resulting tax windfalls—now they’re working on how to protect ratepayers. The easiest way is also the simplest: let these companies build their own power, at their own risk, on their own dime. --- *Joseph Verruni is an energy policy fellow at the Bluegrass Institute.* [*Travis Fisher*](https://www.cato.org/people/travis-fisher?ref=bluegrassinstitute.org) *is director of energy and environmental policy studies at the Cato Institute.* ### Kentucky Officially Opts in to Federal Scholarship Tax Credit Program URL: https://www.bluegrassinstitute.org/kentucky-officially-opts-in-to-federal-scholarship-tax-credit-program/ Last updated: 2026-07-24T15:45:54.000Z On July 22, 2026, Kentucky officially opted into a scholarship tax credit program to benefit students. Bluegrass Institute CEO [Caleb O. Brown](https://www.bluegrassinstitute.org/author/calebobrown/) delivered remarks. Read more about the program from the Bluegrass Institute's [Gary W. Houchens](https://www.bluegrassinstitute.org/author/gary-houchens/): "[Preparing for Kentucky’s New Federal Scholarship Tax Credit](https://www.bluegrassinstitute.org/scholarship-tax-credit-faq/)" July 6, 2026 "[Scholarship tax credits can help more Kentucky students succeed](https://www.bluegrassinstitute.org/scholarship-tax-credits/)" January 29, 2026 ### Kentucky's Switch from the ACT to the SAT: Frequently Asked Questions URL: https://www.bluegrassinstitute.org/act-to-sat-faq/ Last updated: 2026-07-21T14:03:10.000Z *Based on research (*[*Part I*](https://www.bluegrassinstitute.org/evaluating-kentuckys-assessment-results-data-omissions-and-governance/) *|* [*Part II*](https://www.bluegrassinstitute.org/assessment-results-part-2/)*) by* [*Richard G. Innes*](https://www.bluegrassinstitute.org/author/richard-innes/) *for the Bluegrass Institute.* --- **Q: What changed?** Beginning in spring 2026, Kentucky replaced the ACT with the SAT as the state-funded, state-required college admissions exam for 11th graders. The Kentucky Department of Education (KDE) awarded a four-year contract to the College Board after a competitive bid process. The change ends an 18-year run in which every Kentucky junior took the ACT, starting with the 2007-08 school year. **Q: Why did KDE make the switch?** KDE has pointed to cost savings — the new contract is valued at roughly $30 per student and is projected to save the state up to $350,000 annually — along with the SAT's shorter, digital, adaptive format and free Khan Academy practice resources. ACT, Inc. challenged the contract award, but a state review found the protest lacked merit and allowed the switch to proceed. **Q: What are some central concerns about the switch?** Innes' research argues the change was managed poorly and threatens Kentucky's ability to track student performance accurately over time. He raises three main issues: (1) the process lacked transparency, including a lack of statutorily-required stakeholder consultation; (2) the ACT and SAT are different enough that switching [breaks](https://www.bluegrassinstitute.org/testing-kentuckys-high-schoolers-dropping-act-shifting-to-sat-is-the-wrong-move/) the Kentucky assessment program’s only long-term trend line in student achievement; and (3) the SAT does not appear to satisfy Kentucky's statutory testing requirements. **Q: Was the decision made transparently?** According to Innes' analysis, no. The procurement process for a college entrance examination began in early 2025, apparently without public discussion before the state board or any clear notice to stakeholders. A contract with the College Board was signed by June 13, 2025\. However, the Kentucky Board of Education wasn't informed until two weeks later — apparently by emails, not in a meeting open to the public — and district assessment coordinators didn’t learn of the change three days after that. A statewide public advisory wasn't issued by KDE until September 2025, more than three months after the contract was already signed. The Kentucky Council on Postsecondary Education apparently learned of the change only after the fact and apparently was caught off guard by the change, which among other things could impact the KEES state scholarship program. **Q: Did local school districts have input or advance warning?** Apparently not. District leaders reportedly learned about the change indirectly, through the email sent to assessment coordinators rather than by a direct announcement to superintendents. Superintendents indicated they were given little warning and faced a compressed timeline to prepare students and staff for a notably different test after years of investment in ACT-specific practice materials and training. **Q: Did the Kentucky Board of Education formally approve this change?** Innes was unable to locate any public record of a board vote authorizing the switch. State law places the Kentucky Board of Education, not the KDE, in charge of the statewide assessment system. KRS 158.6453 requires the board to consult several advisory bodies — the Office of Education Accountability, the School Curriculum, Assessment, and Accountability Council, the Education Assessment and Accountability Review Subcommittee, and KDE's technical advisory committee — in developing the college entrance exam program. Innes' analysis found no clear evidence that this consultation occurred before KDE signed the contract. **Q: Does the SAT meet Kentucky's legal testing requirements?** State law (KRS 158.6453) [requires](https://www.bluegrassinstitute.org/kentuckys-switch-to-the-sat-violates-public-trust-it-may-also-violate-state-law/) the statewide college admissions exam to separately assess English, reading, mathematics, and science. The SAT tests reading, writing, and math, but it does not report a standalone English score (covering spelling, punctuation and grammar) and has no dedicated science section. Publishers of the SAT claim a science-related score will be derived from questions embedded in the SAT’s reading, writing, and math sections. Innes argues this raises real questions about whether the SAT meets the requirements of statute. In addition, embedding science-focused questions into the areas the SAT does assess may skew those sections toward science content, disadvantaging students who are stronger in humanities or civics. **Q: Can Kentucky just convert old ACT scores into SAT-equivalent scores to preserve its trend line?** No — and this is a key finding in Innes' research. Even the testing organizations that create the ACT and the SAT caution against it. The official ACT/SAT Concordance document states that the two tests measure similar but not identical skills, and the Concordance states its tables are meant only for comparing individual student scores at roughly the same point in time — not for converting long-term aggregate trends. On top of that, the most recent issue of the ACT/SAT Concordance dates back to 2018, before the newest redesign of the SAT. Clearly, nearly two decades of Kentucky ACT data cannot be reliably translated into SAT terms with the existing Concordance, meaning the state's longest and most consistent testing trend line effectively ended. **Q: What has Kentucky's ACT trend line actually shown in recent years?** Kentucky's ACT composite scores for the 11th grade testing rose from the program's 2007-08 start through 2016-17 school year and then began a sustained decline across English, math, reading, and science. By 2024-25, the composite score had fallen to 18.1 (on the ACT’s 36-point scale) from a peak of 19.8 in 2016-17 — erasing the earlier decade’s gains. Innes also contrasts the most recent ACT trends with the more favorable trends shown by the state's own Kentucky Summative Assessment (KSA) between 2021-22 and 2024-25\. The two tests present conflicting pictures of how Kentucky students are actually performing. **Q: Why does Innes think the ACT decline matters for how the switch was communicated?** His research found that when the state released its November 2025 assessment results, the official communications emphasized KSA outcomes. There was no mention of any ACT results although the ACT was still a legally required part of the assessment system in 2025\. The ACT data were posted in the somewhat challenging to access Kentucky School Report Card site but weren't highlighted there, either. Innes reports that ACT results were also left out of presentations to the state board in December 2025 and January 2026\. When ACT data were finally presented to the board in February 2026, the presentation was incomplete, only covering the 201 to 2025 period. That omitted the earlier years that would have made the actual rise and fall of the scores apparent. Innes argues this pattern misleads about the seriousness of the state’s ACT decay after 2017. **Q: Is the new digital SAT the same test many parents remember?** No. Innes' research reveals it is a substantially redesigned assessment: shorter, digital, and adaptive, meaning students receive different questions depending on how they perform on earlier ones. Reading passages are shortened dramatically — from roughly 500-750 words down to as few as 25-150 words — which, per sources Innes cites, eliminates longer historical and foundational-document passages found in older SAT editions. With fewer total questions, each answer carries more weight, and score reports provide less detailed diagnostic breakdown than before. The few students who will still take a paper version (typically those with disabilities) may also face an assessment that isn't truly equivalent to the digital, adaptive format most students will take. **Q: Has there been any legislative action regarding the ACT to SAT switch?** Most definitely. Included in the 2026 legislative package is Senate Bill 197\. Even after the governor line item vetoed some of the language regarding the college entrance exam requirement, the bill stipulates that: ***The Kentucky Department of Education shall initiate a new competitive procurement process and shall award a contract only to a vendor or vendors whose assessment product satisfies all applicable state and federal statutory requirements for accountability and assessment purposes to be in place for the 2026 2027 school year.*** Clearly, legislators are aware of the many issues with the SAT contract and want the job redone, correctly and in accordance with all statutory requirements. **Q: What other things is Innes recommending policymakers do?** His research calls for action from both the Kentucky Board of Education and the General Assembly, including: - A formal state board review of whether the switch complied with KRS 158.6453 and whether required advisory bodies were actually consulted - A public determination of whether the SAT meets the statute's English, reading, math, and science testing requirements - Full, consistent and unbiased public reporting of all required assessment results, including complete (not truncated) trend lines - Legislative investigation into the procurement process and timeline - Considering creation of an independent assessment oversight body separate from the agencies (KDE and KBE) responsible for running education programs, to reduce conflicts of interest. **Q: Does this affect current high schoolers?** The class of 2027 became the first required to take the SAT as part of the state's spring assessment cycle, with testing delivered through the College Board's SAT School Day program during a six-week window beginning in March 2026\. If the rebid contract is awarded to the ACT, or possibly another suitable vendor, the class of 2028 and later could again take the ACT. **Q: Where can I read the full research?** Richard Innes' full analysis is published by the Bluegrass Institute in a two-part series, *Evaluating Kentucky's Assessment Results*, along with a related commentary piece on the legal questions raised by the switch. All are available at bluegrassinstitute.org. --- *This FAQ summarizes research (*[*Part I*](https://www.bluegrassinstitute.org/evaluating-kentuckys-assessment-results-data-omissions-and-governance/) *|* [*Part II*](https://www.bluegrassinstitute.org/assessment-results-part-2/)*)* [*and*](https://www.bluegrassinstitute.org/testing-kentuckys-high-schoolers-dropping-act-shifting-to-sat-is-the-wrong-move/)[*commentary*](https://www.bluegrassinstitute.org/kentuckys-switch-to-the-sat-violates-public-trust-it-may-also-violate-state-law/) *by Richard G. Innes for the Bluegrass Institute. It is intended for general informational and advocacy use and does not constitute legal advice.* ### Caleb O. Brown discusses solutions to Kentucky’s housing crisis on WHAS Radio's Terry Meiners URL: https://www.bluegrassinstitute.org/cob-terry-meiners-202607/ Last updated: 2026-07-22T20:40:41.000Z [Bluegrass Institute CEO Caleb O. Brown](https://www.bluegrassinstitute.org/author/calebobrown/?ref=bluegrassinstitute.org) joins the show to discuss the root causes of Kentucky's ongoing housing crisis. Brown explains how restrictive local zoning laws, regulatory barriers, and drawn-out approval processes have stalled new construction and priced many families out of homeownership. To combat these soaring costs, he advocates for statewide policy reforms like accelerated permitting "shot clocks" and the expanded legalization of accessory dwelling units (ADUs) to rapidly increase the housing supply. For more on housing policy, read our report [*A Menu of Options for Kentucky Housing Reform 2026*](https://www.bluegrassinstitute.org/a-menu-of-options-for-kentucky-housing-reform-2026-2/), or Brown's [analysis of the 2026 Kentucky legislative session](https://www.bluegrassinstitute.org/kentucky-general-assembly-failed-to-deliver-on-housing-affordability/). ### E pluribus unum at 250 URL: https://www.bluegrassinstitute.org/e-pluribus-250/ Last updated: 2026-07-16T12:01:34.000Z Every July 4th, Americans light fireworks, wave flags, and sing songs. This year, we do all of that and more: the nation turns 250, a milestone grand enough to demand something beyond the usual celebrations. So here is a question worth sitting with this weekend: What holds us together? Not what should hold us together in theory, but what actually does. What shared inheritance, what common story, what sense of mutual obligation binds 340 million people into something we can still honestly call one nation? Our national motto offers a clue, and a challenge. *E pluribus unum*: “from the many, one.” The Founders borrowed the phrase from a Roman poem, but they made it their own. They knew, as well as anyone, that the “many” they were working with was already deeply diverse: thirteen fractious colonies, competing economic interests, regional loyalties, and profound disagreements about the new nation’s soul. What made “unum” possible was not uniformity. It was a shared formation, a common set of texts, stories, principles, and heroes held in common memory and transmitted, generation by generation, through deliberate civic education. That transmission has broken down. Americans increasingly inhabit not just different political camps but different epistemic worlds. We do not merely disagree about conclusions, we disagree about premises, about history, about what the founding was and whether it deserves to be honored at all. The fracturing is cultural before it is political, and it runs deeper than any election can fix. Two failed responses have dominated our public argument about this crisis. The first insists that the founding was so irredeemably stained by slavery and conquest that nothing essential about it is worth recovering, that the honest American story is primarily a story of oppression, and that “patriotism” is little more than a cover for power. [](https://substackcdn.com/image/fetch/$s%5F!VHSj!,f%5Fauto,q%5Fauto:good,fl%5Fprogressive:steep/https%3A%2F%2Fsubstack-post-media.s3.amazonaws.com%2Fpublic%2Fimages%2Fb95d8708-cd04-4065-9f47-a68b3aba2fa8%5F651x900.jpeg?ref=bluegrassinstitute.org) The second responds with an uncritical nostalgia, demanding a return to a golden age that was never quite as golden as remembered, and dismissing every inconvenient complication as revisionism. Both responses, in their different ways, sever the connection between memory and hope. They leave us either with a past too poisoned to learn from, or a past too sanitized to tell the truth about. Neither produces citizens capable of self-governance. Neither is remotely adequate to the complexity of the American story. What we need instead is what the best civic education has always aimed at: an honest reckoning with both the gifts and the failures of our inheritance, what the political philosopher Patrick Deneen has called “temporal continuity,” a felt-presence of past and future in the present. Not nostalgia or condemnation, but the kind of engaged memory that allows a people to say: where we came from is good, these are the principles we have repeatedly failed to live up to, and this is why it still matters that we try. The classical tradition in education has always understood this. Students who read the Declaration of Independence alongside Frederick Douglass’s 1852 speech, “What to the Slave is the Fourth of July,” encounter the full, honest tension of the American experiment: founding principles magnificent enough to indict the nation’s own failures, and a tradition flexible and self-correcting enough to survive those indictments. Educating students that way is not indoctrination. It is formation. And it is precisely what e pluribus unum has always required. America at 250 does not need a verdict on whether our country is good or evil. It needs citizens who actually understand our founding, who know enough of the story to both love it and argue with it honestly. A republic of people who share nothing but grievances, or nothing but myths, cannot long govern itself. The fireworks are beautiful. But the harder and more necessary work, the work of forming citizens who can sustain a republic, happens in classrooms, at kitchen tables, in books read slowly and argued over freely. That work is never finished. At 250, it is more urgent than ever. --- *This piece originally appeared in the Bowling Green Daily News.* ### Beshear’s instincts on data centers are good but his tools are few URL: https://www.bluegrassinstitute.org/beshear-data-centers/ Last updated: 2026-07-13T19:14:32.000Z *This piece first appeared in the* [*Kentucky Lantern.*](https://kentuckylantern.com/2026/07/02/beshears-instincts-on-data-centers-are-good-but-his-tools-are-few/?ref=bluegrassinstitute.org) --- Gov. Andy Beshear [has a clear message on data centers](https://www.youtube.com/live/26JsrM9HN3U?si=UIfW390k9uVgBcep&t=3414&ref=bluegrassinstitute.org): Not one penny of Kentuckians’ electric bills should rise because of them. Any data center that wants to locate in Kentucky must pay for 100% of its own energy, including any new generation it requires. Companies that can’t meet that standard, he says, aren’t welcome. The principle is exactly right. The problem is that it’s easier said than done. There is no Kentucky law requiring data centers to cover their own costs. [House Bill 593](https://apps.legislature.ky.gov/record/26rs/hb593.html?ref=bluegrassinstitute.org) – which would have required new data centers to bring their own generation, prepay infrastructure costs, or buy power on the open market – never received a vote in the Senate, in spite of overwhelming support in the House (90-8). What Beshear offers instead is a series of pledges made to him in private meetings. A pledge to the governor is not a tariff. It is not a statute. It is not a Public Service Commission (PSC) order. When a project’s economics tighten three years in, a handshake in Frankfort with a now-former governor will not protect ratepayers. The governor’s authority is also thinner than his rhetoric. He says he won’t “let” a bad project come to Kentucky. But where facilities land is a local zoning question. The decision of how to set rates belongs to the PSC. His real leverage is incentive approvals and the bully pulpit, and his ability to appoint PSC commissioners. These are lagging or weak political weapons, at best. Beshear should, however, be praised for his political bravery in taking a measured view of data centers. The politics of data centers are currently grim: [most people blame them for rising electricity prices](https://heatmap.news/energy/data-centers-electricity-prices-blame?ref=bluegrassinstitute.org), and [vast majorities don’t want them](https://news.gallup.com/poll/709772/americans-oppose-data-centers-area.aspx?ref=bluegrassinstitute.org) (7 in 10 are opposed to local siting, with nearly half strongly opposed, and barely a quarter in favor). However, there are strong benefits to data centers. They are a cash cow for local governments. Beshear frames the windfall in terms of new spending–teacher raises chief among them, for a constituency that is among his strongest allies–when it could fund tax relief. He also notes not all data centers are for artificial intelligence. In other words, if you are reading this, it is coming to you from a data center. Choosing which disfavored industries are allowed the privilege of access to electricity is a dangerous game. Data centers have environmental costs and energy demands, but this is true of almost all industrial facilities. And banning data centers won’t mean an end to AI–it just means the facilities locate elsewhere, while other local economies reap the benefits. There is a moment of bipartisan support for legislation insulating ratepayers from paying data center costs. The current research is murky as to whether or not data centers raise electricity prices, but public perception is often more politically potent than economics. [The long run of electricity demand remaining flat is coming to an end](https://www.eia.gov/pressroom/releases/press587.php?ref=bluegrassinstitute.org), and Kentucky can’t rest on its laurels and hope electricity prices remain low and Kentucky’s competitive advantage continues. None of this is as simple as it sounds. It is essentially illegal for anyone other than the data center developer itself to build power generation and sell it to them off-grid–and few data center operators are in the power generation business – for example, if Google wants to build a data center, Google is the only company that can provide it with off-grid power, and Google is not a power generation company. Electrical utilities are government-protected monopolies, so any proposed changes become a dance between consumers and utilities refereed by the Public Service Commission and the regulations bestowed on them by the legislature–a data center cannot go to the electricity store and buy a box of electricity as though it were an office supply. Policies like [consumer-regulated electricity](https://www.cato.org/briefing-paper/case-consumer-regulated-electricity-private-electricity-grids-offer-parallel-path?ref=bluegrassinstitute.org)–in which entities can create their own electrical grid, generate and sell power, and avoid PSC regulation while insulating current ratepayers–are not currently the law of the land in the commonwealth (though [lawmakers should change that](https://alec.org/model-policy/act-to-allow-for-consumer-regulated-electric-utilities/?ref=bluegrassinstitute.org)). If Beshear wants to both protect ratepayers and make Kentucky a welcoming destination for large energy consumers and the tax windfall they can provide, he should work with lawmakers on legislation that gives data centers developers and utilities tools to do just that. --- *Joseph Verruni is an energy policy fellow at the Bluegrass Institute.* ### The State of Social Mobility in Kentucky Part I: Institutions and Rule of Law URL: https://www.bluegrassinstitute.org/social-mobility-in-ky-part-i/ Last updated: 2026-07-11T14:34:12.000Z When we think about the American Dream, we think about social mobility. Social mobility is a simple idea: Your life outcomes should largely be unrelated to your parents’ status. If you were born into poverty or another precarious situation, you should have the opportunity to achieve wealth and stability. At the same time, being born to rich parents should not guarantee success. When societal institutions are strong, fair, and transparent, they facilitate upward social mobility. Whether the American Dream is still alive today is widely debated, and those debates inevitably circle back to one thing: Success often does depend on where you were born and whom you were born to. [The State of Social Mobility in Kentucky Part I: Institutions and Rule of Law20260709 StateOfSocialMobility.pdf2 MBdownload-circle](https://www.bluegrassinstitute.org/content/files/2026/07/20260709-StateOfSocialMobility.pdf "Download") Harvard economics professor Raj Chetty and his research team at Opportunity Insights provide a simple example. The chances of someone born in the bottom quintile of the national income distribution charting a path to the top quintile vary widely by area. If you were born in Atlanta, your chances are 4.5%; however, your chances if you were born in San Jose (12.9%) are nearly three times higher. Individuals born in Salt Lake City (10.8%) have roughly the same chance as those born in Boston (10.4%) or Washington, DC (11%). Most areas in Kentucky, with chances ranging from 5.2% (Louisville) to 13.1% (Pikeville), fall in the bottom half of the national rankings. **Figure 1\. The Geography of Upward Mobility in the United States** ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/07/fig1.jpg) Archbridge Institute, a think tank focused on solutions to upward mobility, recently published its Social Mobility of the 50 States report that shows similar disparities (see figure 2). In the most recent edition (using mostly 2023–2024 data), Kentucky ranks 41st—in the bottom 10 of all states. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/07/fig2.jpg) In this three-part series on the state of social mobility in Kentucky, we will begin by examining the Institutions and Rule of Law pillar in the Social Mobility of the 50 States report. In the remaining series, we will focus on the Environment for Entrepreneurship and Economic Growth pillar, and the Education and School Freedom area. ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) ## Why Institutions and Rule of Law Matter Institutions provide the rules of the game to society, and decades of research show that legal systems, property rights protection, and the rule of law are among the strongest predictors of economic growth. Having strong and fair institutions, through low corruption, high quality legal systems, and less predatory state action, is essential for social mobility. When the rules favor one group over another, they usually benefit the group that already has a higher status. The disfavored group is often left with fewer opportunities, greatly lowering its chances of achieving upward mobility. Corruption is one manner in which elite groups benefit at the expense of the rest of society. A large body of evidence finds that corruption increases inequality and social exclusion, decreasing social mobility. Transparency International, a research institution focused on combatting corruption around the globe, puts it bluntly in a 2017 study: “Corruption leads to an unequal distribution of power in society which, in turn, translates into an unequal distribution of wealth and opportunity.” Predatory legal systems follow the same throughline: using state-sanctioned force at the expense of everyday citizens. For example, civil asset forfeiture schemes often make it possible for police agencies to confiscate assets without an official charge of the crime. Historically, this has come at the expense of those with less socio-economic status. This boosts the police agencies’ own revenue while taking property of its citizens. Similarly, overly burdensome fines and fees incentivize revenue collection over addressing public safety. A 2023 paper by the author (with economist Vincent Geloso) shows a similar conclusion: Places with greater economic freedom have notably higher social and income mobility, and the effect is stronger where legal systems are stronger and property rights are better protected. States with more just and less predatory legal systems allow for the development of skills, capital, and opportunities that make it more likely for individuals to achieve upward mobility. The opposite is also true. States with corrupt and predatory legal institutions lock the poor into their socioeconomic status, leaving opportunities to those with political connections and the skills needed to maneuver through an elaborate bureaucratic system. These skills are then used for “unproductive” entrepreneurship (lobbying and political favoritism) that decreases economic growth and prosperity. Kentucky, unfortunately, ranks low (39th) on the Institutions and Rule of Law pillar in the Social Mobility of the 50 States report. In a country whose judicial system is based on the principle of “innocent until proven guilty,” states that fail to uphold this ideal tend to harm the poor the most. ## Comparing Kentucky to Its Neighbors: Institutions and Rule of Law Compared to its seven bordering states—Illinois, Indiana, Missouri, Ohio, Tennessee, Virginia, and West Virginia—Kentucky has the second-lowest score on the Institutions and Rule of Law pillar—better only than Illinois (see figure 3). ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/07/fig3.jpg) The Institutions and Rule of Law pillar is made up of two subpillars. - **Predatory State Action:** The average of (1) total fines and fees collected by local governments per capita, (2) corruption perceptions, and (3) civil asset forfeiture policies. - **Judicial System Quality:** The average of (1) access to justice, (2) quality of the state liability system, and (3) tort costs as a share of GDP.8 ### Predatory State Action Among its neighbors, Kentucky performs poorly on Predatory State Action, again ranking above only Illinois. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/07/fig4.jpg) Kentucky’s brightest spot in this pillar is its exceptionally low level of fines and fees per capita (see figure 5). Fines are typically imposed upon conviction for failing to comply with an ordinance, from speeding tickets to lawn care citations. Fees, or “user fees,” are a form of revenue generation rather than a penalty for failing to follow some law. This includes costs associated with one’s right to due process, with some examples being courtappointed attorney fees, supervision fees, drug testing fees, and rental fees for electronic monitoring devices. These occur regardless of if the person was actually guilty of the crime that they committed. Such fees are more encumbering for someone with less economic means. Kentucky collects just $2.50 per person—the 3rd lowest in the country. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/07/fig5.jpg) ### Corruption Unfortunately, Kentucky scores the lowest in the country on corruption perceptions (see figure 6). These ratings come from a survey of journalists across the country who were asked to rate states on both “legal” and “illegal” corruption within the state they report on.9 - Legal corruption refers to political favoritism that is technically lawful—campaign contributions or endorsements exchanged for special benefits to groups and individuals—but is morally suspect. - Illegal corruption refers to public officials providing private gains (quid pro quos) in the form of cash, gifts, or other favoritism in return for specific benefits to others. Reporters were asked how common each type of corruption is—with five options ranging from “not at all common” to “extremely common”—across the executive, judicial, and legislative branches in each state. Corruption was perceived as very or extremely common in several areas within Kentucky: - Illegal corruption in the legislative branch was perceived as very common. - Legal corruption in the executive branch was perceived as extremely common (New Jersey was the only other state perceived this way). - Legal corruption in the legislative branch was also rated extremely common. - Perhaps most concerning, Kentucky was one of only a few states to be perceived as having moderately common legal corruption in the judicial branch. Kentucky had a famous instance of corruption through the FBI investigation Operation Boptrot, where 15 state legislators were convicted of various corruption-related charges. Despite this occurring in the early 1990s, the perception of corruption has not fully faded. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/07/fig6.jpg) ### Civil Forfeiture The final variable in the Predatory State Action subpillar is civil forfeiture—arguably the clearest example of state predatory behavior toward its citizens. Under civil forfeiture, states can seize and keep property—homes, cars, cash, even things like TVs and taxidermy pieces—based solely on probable cause, without ever securing a criminal conviction. Kentucky earns a D- from the Institute for Justice (IJ) for its civil forfeiture laws—tied with 28 other states for the 2nd lowest score. (Only Massachusetts received a lower grade, an F). Among Kentucky’s neighbors (see figure 7), all but two also received a D-. Indiana does slightly better with a D, while Missouri stands out with a B+, tied for the 3rd best grade nationally. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/07/fig7.jpg) Kentucky requires owners to prove their property’s innocence, not only flipping the standard of “innocent until proven guilty” but requiring an inanimate object, the seized property, to be the defendant in civil forfeiture cases. “Slight evidence of traceability” is enough to justify the government’s seizing property and keeping it. Only for real property—such as land—is the standard higher at “clear and convincing evidence.” Worse still, Kentucky allows forfeiture even if the owner is never convicted or even charged.12 Combined with the fact that agencies are able to keep 100% of the forfeiture funds, the state has created both a low barrier to seize property and a strong financial incentive to do so. Kentucky is one of the few states that combines all four of the worst possible features of a civil forfeiture regime: 1. Lowest evidentiary standard 2. Burden placed on innocent owners to prove their property is not guilty 3. 100% profit incentive for agencies 4. No conviction requirement From 2007 through 2023, Kentucky state and local agencies took over $65 million through civil forfeiture. From 2000 through 2023, they took another $152 million by circumventing state law to work with federal agencies under federal civil forfeiture law. ## Policy Proposals We offer two areas of reform to improve institutions and the rule of law in Kentucky, focusing on reasonable solutions in the areas where Kentucky scores nearest to the bottom nationally ### Unwind Kentucky’s Civil Forfeiture Scheme We recommend two reforms regarding civil forfeiture. First, Kentucky should end civil forfeiture altogether and replace it with a criminal forfeiture process. No one in the Commonwealth should lose their property without being found guilty of a crime. Due process preserves property rights without an increase in crime or a decrease in arrests. Short of that, Kentucky could adopt modest reforms by raising the evidentiary standard the government must meet to keep someone’s property. The current “slight evidence of traceability” should be changed to “beyond a reasonable doubt” or at least to a “moderate conviction” provision (which could hinge on the conviction of anyone tied to the property, not necessarily the owner). By shifting the burden back where it belongs—onto the state—these reforms would provide an avenue for wrongfully seized property to be returned to owners. Second, if Kentucky maintains a civil forfeiture scheme, we recommend improving transparency and accountability requirements. According to the Institute for Justice, Kentucky requires scant information collection for seized property and no information collection regarding how the funds from those seizures are spent. Kentucky law enforcement agencies should be required to track relevant data, including the following: - date that the property was seized - alleged crime that led to seizure - crime that the suspect was charged with (if any) - whether property was transferred to another agency (like the federal government) - value of property seized Given that agencies can self-fund through civil forfeiture, they should be required to report how those funds are spent and state law should require financial audits of such funds. ### Improve Corruption Perceptions by Strengthening Transparency and Accountability One durable way to reduce perceptions of corruption in Kentucky is to make the regulatory and permitting process transparent. Regulations, guidance documents, and permitting requirements are scattered across agencies, buried in hard-to-access formats, or unavailable altogether. This opacity creates opportunities for favoritism, discretionary enforcement, and unequal treatment—especially when well-connected actors can navigate informal channels while everyone else is left guessing. Establishing a centralized, machine-readable regulatory database would make all statutes, regulations, guidance documents, and interpretive materials publicly accessible in one place. That centralized database would allow citizens, businesses, journalists, and lawmakers to see exactly what rules govern private behavior, where they come from, and how they change over time. Transparency alone—without granting new enforcement power—can substantially limit the conditions under which corruption thrives. Permitting transparency would reinforce this effect by exposing how regulatory power is exercised in practice. A public permit-tracking portal would allow applicants and the public to monitor approval timelines, responsible offices, and agency performance across the state. When permit decisions and delays are visible, it becomes harder for agencies to favor politically connected applicants or stall disfavored ones. Crucially, both reforms operate entirely within Kentucky’s constitutional framework—they do not empower the legislature to veto executive actions, but instead make regulatory activity observable. By replacing opacity with visibility, Kentucky can meaningfully reduce corruption perceptions while strengthening accountability, fairness, and public confidence in state institutions. [The State of Social Mobility in Kentucky Part I: Institutions and Rule of Law20260709 StateOfSocialMobility.pdf2 MBdownload-circle](https://www.bluegrassinstitute.org/content/files/2026/07/20260709-StateOfSocialMobility-1.pdf "Download") --- [*Justin T. Callais, PhD*](https://www.archbridgeinstitute.org/justin-callais/?ref=bluegrassinstitute.org)*, is Chief Economist at the* [*Archbridge Institute*](https://www.archbridgeinstitute.org/?ref=bluegrassinstitute.org)*.* *The Bluegrass Institute works with Kentuckians, pro-liberty coalitions, grassroots organizations and business owners to advance freedom and prosperity by promoting individual liberty, limited and transparent government, and free markets* ### The Endurance of Our Declaration of Independence URL: https://www.bluegrassinstitute.org/franz-declaration-of-independence/ Last updated: 2026-07-09T15:23:43.000Z *This piece originally appeared in* [*National Review*](https://www.nationalreview.com/2026/07/the-endurance-of-our-declaration-of-independence/?ref=bluegrassinstitute.org)*.* --- Large-scale republics don’t have the best track record of longevity. Governments have historically been run by kings, emperors, or other systems of absolute authority. Rome itself lasted less than 500 years before giving way to an empire. As America celebrates our [250th year](https://www.nationalreview.com/tag/america-at-250/?ref=bluegrassinstitute.org) of independence as the most successful and powerful modern republic, a worrisome question lingers in many of our minds — *How long can America last as a liberal republic?* U.S. citizens and international observers alike have pondered this question time and again since the American Revolution ended. The American experiment has persevered against the fragility of the early republic, the threat of disunion through the Civil War, and the rise of 20th century totalitarianism and two world wars. Yet with each passing generation, the core principles of republican liberty have been maintained and even expanded — albeit imperfectly, and not without periods of regression. Despite the clouds of illiberalism forming in the early 21st century, we have good reason to keep our faith in the strength of the American republic, more so than any other that came before it. The uniqueness of our endurance stems not from a shared ethnicity, language, or ancestry, but rather from a shared creed first articulated in the Declaration of Independence. Following the War of 1812, the founding generation gave way to new, ambitious young leaders who had visions of national greatness. But those visions carried a fatal contradiction. The westward expansion that Thomas Jefferson optimistically thought would create an “empire of liberty” was becoming a vehicle for the spread of slavery instead. When the last surviving signer of the Declaration, Charles Carroll, died in 1832, the living link to those founding ideals was severed. American victory in the Mexican War of 1846–1848 brought the issue to a head, providing the United States with vast new territory, forcing Congress to contend with slavery’s territorial expansion and growing political influence. As Congress debated the fate of the new territory, some newer members looked back to the founding era for inspiration. In 1850, the newly elected senator from Ohio, Salmon P. Chase, considered slavery to be at odds with the Founders’ original vision for America. [He pointed to](https://nationalhumanitiescenter.org/pds/triumphnationalism/wakecounty/chase.pdf?ref=bluegrassinstitute.org) the Northwest Ordinance of 1787 — which expanded republican government in the territory acquired following the 1783 Treaty of Paris and prohibited slavery within its borders — as evidence “that the declaration of 1776 was not an empty profession, but a true faith.” Thus, in being consistent with that vision, Congress had a right and responsibility to prohibit slavery within federal territory and the District of Columbia, and prohibit the interstate slave trade. Chase’s colleague from Massachusetts, Charles Sumner, [made this argument](https://reader.library.cornell.edu/docviewer/digital?id=may838820%23page/17/mode/1up&ref=bluegrassinstitute.org) in even more vivid terms. “According to the true spirit of the Constitution, and the sentiments of the \[Founding\] Fathers, Slavery and not Freedom is sectional, which Freedom and not Slavery is national.” The presupposition of freedom in the United States, Sumner argued, predated the Constitution. “Earlier than the Constitution was the Declaration of Independence, embodying, in immortal words, those primal truths to which our country pledged itself with its baptismal vows as a Nation.” Sumner understood the Declaration to be the nation’s founding promise, one that Congress was obligated to honor in its legislative decisions. As slavery took center stage as the driving wedge issue throughout the 1850s, Abraham Lincoln looked to the Declaration as the key to our national survival. During one of[ his famous debates](https://mason.gmu.edu/~zschrag/hist120spring05/lincoln%5Fottawa.htm?ref=bluegrassinstitute.org) with Senator Stephen Douglas from Illinois, Lincoln affirmed that “all the natural rights enumerated in the Declaration of Independence, the right to life, liberty, and the pursuit of happiness,” were meant to be extended to black Americans, enslaved or otherwise. After being elected president, Lincoln stopped at Independence Hall [to speak on](https://teachingamericanhistory.org/document/address-in-independence-hall/?ref=bluegrassinstitute.org) the occasion of Washington’s birthday. “I have never had a feeling politically that did not spring from the sentiments embodied in the Declaration of Independence,” he told his audience in 1861\. The Declaration, he asserted, held “that in due time the weights should be lifted from the shoulders of all men, and that all should have an equal chance.” Lincoln’s appeal to the Declaration here was more than political strategy. He understood it as the spiritual foundation of the republic, the creed that was needed to preserve the integrity of the Union. As the Civil War ravaged the country from the outset of his administration, it was the Declaration that continued to be his guiding light. Citing it in his Gettysburg Address, he described America as a nation “conceived in liberty, and dedicated to the proposition that all men are created equal.” The United States officially divorced itself from the institution of slavery in 1865 with the ratification of the 13th Amendment. Throughout the late 19th and early 20th centuries, Americans had new and challenging issues to confront — from Reconstruction, to rapid industrialization, to world war. In the midst of all the dramatic change associated with the turn of the century, many of the most prominent voices of the age urged bold progressive ideas to lead the United States throughout the 20th century. In contrast, President Calvin Coolidge believed that the ideas that were already articulated in the Declaration would be a sufficient anchor against the prevailing and chaotic social and political winds of the day. Serving as president during the 150th anniversary of American independence, Coolidge had a unique opportunity to reflect on the Declaration and its enduring relevance. In [a speech](https://www.presidency.ucsb.edu/documents/address-the-celebration-the-150th-anniversary-the-declaration-independence-philadelphia?ref=bluegrassinstitute.org) given to mark the occasion in Philadelphia on July 5, 1926, he asserted that it was not “to proclaim new theories and principles that this annual celebration is maintained, but rather to reaffirm and reestablish those old theories and principles which time and the unerring logic of events have demonstrated to be sound.” “We live in an age of science and of abounding accumulation of material things,” he said in closing. “These did not create our Declaration. Our Declaration created them. The things of the spirit come first. Unless we cling to that, all our material prosperity, overwhelming though it may appear, will turn to a barren scepter in our grasp.” A hundred years later, on the 250th anniversary, we run that same risk. As in Coolidge’s day, political factions on the left and the right are happy to suggest new, bold ideas that reject the liberal tradition of the United States and its republican system of government. But also as it was in Coolidge’s day, and in Lincoln’s before him, the Declaration will help us navigate new challenges while preserving the ideas that brought us here. We look to the Declaration not just to honor the past, but to understand how to navigate our future. Its endurance is no accident — it’s the defining feature of our republic. All we need to do is cling to it. --- *This piece originally appeared in* [*National Review*](https://www.nationalreview.com/2026/07/the-endurance-of-our-declaration-of-independence/?ref=bluegrassinstitute.org)*.* [Caleb Franz](https://www.nationalreview.com/author/caleb-franz/?ref=bluegrassinstitute.org) is the Contributor Program manager at Young Voices, a scholar with the Bluegrass Institute, and the author of [*The Conductor: The Story of Rev. John Rankin, Abolitionism’s Essential Founding Father*](https://www.amazon.com/Conductor-Rankin-Abolitionisms-Essential-Founding/dp/1637589891/ref=sr%5F1%5F1?crid=3C49JHCEUKMNX&dib=eyJ2IjoiMSJ9.TxsSAyEINC0wGzExgua13XIGOWfNWidtpQJjIBNghsSh8cwaEPzA2eiNU9lgN9%5FgHKWan0ZW4iiFmGAUQGJrQjs6ENyn-JRF6qiZj0-4FNzQZ9XA8bNPgiPQ0TfAbJQfKxhxLoPlCgiSFgzNj2wK0qpPfr2-cELun7LpN1enUkCf6tKNoWhyhJKoiqYJzLwEsOik4BMf3KFBCcuEpC9Ldh8q6vF-qBAF37ZX2gLKIBn7wka2arDjwWlp0b6ITGhep3nvEthBLX2J3UtcXhs0q46N5pfGgvG22xXudRpAYGY.VOlx8krAKiBaBeFKR7Oo9oJfWgaBpJDX2k%5FIVWRYgnc&dib%5Ftag=se&keywords=the+conductor+by+franz&qid=1721325503&sprefix=the+conductor+,aps,118&sr=8-1&ref=bluegrassinstitute.org). ### Preparing for Kentucky’s New Federal Scholarship Tax Credit URL: https://www.bluegrassinstitute.org/scholarship-tax-credit-faq/ Last updated: 2026-07-06T12:08:25.000Z *What HB 1 and the federal Education Freedom Tax Credit mean for your school — and what to do right now.* --- | $1,700Federal tax credit per donor, per year | 90%Of SGO funds that must go to scholarships | 300%Area median income ceiling for eligibility | Jan. 1, 2027Program launch date | | -------------------------------------------- | -------------------------------------------- | ---------------------------------------------- | ------------------------------- | ### **What is the federal Education Freedom Tax Credit?** A provision of the One Big Beautiful Bill Act (OBBBA), signed into law in July 2025, gives individual donors a dollar-for-dollar federal tax credit of up to $1,700 per year for contributions to approved Scholarship Granting Organizations (SGOs). Married couples filing jointly can each claim the credit, for up to $3,400 per household, and unused credit carries forward up to five years. The key thing to understand is who is who: the *donor* makes the gift and claims the credit; the *SGO* pools those gifts and awards scholarships; and the *family* receives a scholarship for a child’s education. Your school is not the donor and will not be the SGO. Your school is where families can spend the scholarship. ### **What did Kentucky’s House Bill 1 do?** HB 1 opted Kentucky into the federal program. It became law on March 17, 2026, after the General Assembly overrode Governor Beshear’s veto. The law designates the Kentucky Secretary of State (currently Michael Adams) as the state’s SGO registrar, responsible for publishing regulations, approving SGOs, and reporting Kentucky’s participation to the U.S. Treasury. Without HB 1, Kentucky donors could still have claimed the credit — but only by giving to SGOs in other states, leaving Kentucky students out. ### **Has SGO registration opened in Kentucky yet?** Not yet, as of this writing. The Secretary of State’s office is still developing the regulations and application process for SGOs. HB 1 included an emergency clause allowing this work to begin immediately, and Secretary Adams has publicly supported the program. Kentucky’s first list of approved SGOs is due to the federal government by January 1, 2027 — the date scholarships can begin receiving donations. ### **If registration isn’t open, what should our school do right now?** Prepare. The schools that act now will be ready to move the moment the state’s process opens. Concretely: - **Confirm your tax-exempt status.** Confirm that your school’s affiliated nonprofit holds current 501(c)(3) status — and is not classified as a private foundation — or begin that application now, since IRS determinations can take months. - **Identify a path to affiliation.** Most schools cannot serve as their own SGO (see below) and will need to partner with an existing or emerging SGO, or join with other schools to help establish one. - **Engage legal counsel early.** Have counsel review the federal requirements and Treasury guidance, your options for SGO affiliation or formation, and what participation does and does not obligate your school to do (see “Will participating put our school’s independence at risk?” below). - **Track the local landscape.** [EdChoice Kentucky](https://www.edchoiceky.com/?ref=bluegrassinstitute.org) is monitoring the program as the state’s SGO landscape develops and is the best single source for Kentucky-specific updates. - **Educate your community — donors and families.** Tell potential donors about the $1,700 credit so they’re ready to give once an approved SGO exists, and tell parents, alumni, and prospective families that scholarships are coming. These are two different audiences with two different asks. - **Monitor the Secretary of State’s office.** Watch [sos.ky.gov](https://www.bluegrassinstitute.org/con-faq/) for proposed regulations and the SGO application process. ### **Can our school become its own SGO?** Generally, no. Federal rules require an SGO to spend at least 90% of contributions on scholarships and to serve students who do not all attend the same school. A school directing funds only to its own students would not meet that test. Most private schools will instead partner with an existing or newly forming SGO, or work with other schools to help establish one. ### **What are the basic requirements for an SGO?** - Be a 501(c)(3) public charity — not a private foundation. - Spend at least 90% of contributions on scholarships; cap administrative costs at 10%. - Serve at least 10 students who do not all attend the same school. Students in a minimum of two schools must be served by each SGO. - Maintain separate accounting for scholarship funds. - Verify family income and student eligibility. - Prioritize returning scholarship recipients, then their siblings. - Prohibit earmarking donations for specific students, and exclude board members and major donors from receiving scholarships. ### **Which students are eligible for scholarships?** Students who are eligible to enroll in public school and whose household income does not exceed 300% of the area median income where they live. This threshold is deliberately broad: the Urban Institute estimates that roughly 90% of U.S. households qualify nationally. The program is built for working- and middle-class families, not only the lowest-income households. ### **What can scholarship funds be used for?** - Private school tuition and fees - Books, supplies, and classroom materials - Tutoring and special-needs services - Computers, tablets, and technology - Internet access for learning - School uniforms and required attire - Transportation to and from school ### **Will participating put our school’s independence at risk?** Most likely not — but it is worth understanding why, and staying alert. Because the benefit flows as a federal tax credit to *donors*, who give to an *SGO*, which then awards scholarships to *families*, your school is not a direct recipient of federal funds the way it would be under a government grant or a public voucher. Federal law for this program also includes provisions intended to protect the autonomy of participating private and religious schools and to limit government control over their operations. Even so, scholars at the Cato Institute and others rightly caution that federal involvement in private education can invite federal regulation over time, conditions that are modest today can be expanded by a future Congress or administration. The practical takeaway: have your counsel confirm exactly what participation requires, keep your role as an SGO partner rather than a federal grantee, and watch for changes in Treasury guidance and the underlying statute. Going in clear-eyed is the best protection for the independence that makes your school worth choosing. ### **Does this cost Kentucky any tax dollars?** No. The program uses a federal tax credit, not state appropriations. HB 1 does not spend state tax dollars, does not reduce SEEK funding, and does not create a new state spending program; donor contributions are redirected federal tax liability, not new public spending. It also helps to say plainly what the program is not: it is not a state voucher, it does not pull money out of public-school classrooms, and — given the 300% income ceiling — it is aimed at ordinary working families, not the wealthy. ### **What is the single most important thing to do this summer?** Confirm your nonprofit status and start the conversation with legal counsel about SGO affiliation. Everything else — donor and family education, identifying eligible families, watching for state regulations, protecting your autonomy — follows naturally once that foundation is in place. Schools that wait until registration opens in late 2026 may not be ready to participate in the program’s critical first year. ### Certificate-of-Need Laws in Kentucky: Frequently Asked Questions URL: https://www.bluegrassinstitute.org/con-faq/ Last updated: 2026-07-01T13:02:32.000Z *Based on the Bluegrass Institute policy brief "*[*Certificate-of-Need Laws in Kentucky: Current Status and Opportunities for Evidence-Based Reforms*](https://www.bluegrassinstitute.org/certificate-of-need-laws-sigaud-orozco/)*" by Liam Sigaud and Edgar Orozco.* --- ### **1\. What is a certificate-of-need law?** A certificate-of-need, or CON, law requires health care providers to obtain state approval before starting certain projects, such as opening a facility, adding beds or services, or buying major medical equipment. The state must determine that the project is "needed" before it can move forward. ### **2\. Why were CON laws created?** CON regulations were intended to lower health care costs by preventing the unnecessary duplication of medical services and ensuring equitable access to care. The policies were well-intentioned, but the evidence overwhelmingly indicates they have not achieved those goals. ### **3\. How restrictive are Kentucky's CON laws compared with other states?** Kentucky retains some of the country's most restrictive CON rules. Its laws constitute one of the most extensive regulatory gatekeeping systems in the nation, covering 19 specific types of facilities. On a measure comparing Kentucky with its seven bordering states, Kentucky scored 100 out of 100, indicating CON barriers in every category measured. Only two bordering states received the same maximum score, while Indiana and Ohio have eliminated most of their CON regulations and received the lowest, or best, scores. ### **4\. What kinds of facilities and activities does Kentucky's CON law cover?** Kentucky's CON law covers 19 types of facilities, ranging from hospitals and psychiatric facilities to highly specialized facilities such as kidney disease centers, hospices and home health agencies. Existing providers must also obtain a new CON for a range of activities, including capital expenditures above certain thresholds, substantially increasing bed capacity or services, acquiring major medical equipment, or altering a location designated on a previous CON. ### **5\. What does it cost and take to apply for a CON in Kentucky?** Depending on the proposed project's capital expenditure, CON application fees can reach $25,000\. The process is so bureaucratic and convoluted that applicants often find it necessary to partner with expensive law firms that specialize in CON law. ### **6\. How often are CON applications approved?** An analysis of every CON application submitted in Kentucky from 2019 to mid-2023 found that 98 complete applications underwent substantive review, of which 71% were approved. But when would-be competitors opposed an application, the approval rate fell to 43%, and the average time to a final decision nearly doubled, from 5.4 months for unopposed applications to 10.2 months for opposed ones. Still more applications were likely never submitted because of the costly, time-consuming process. ### **7\. How do CON laws let competitors block new providers?** Incumbent providers are given broad latitude to challenge CON applications from potential competitors or to demand additional hearings to delay entry. This lets existing businesses use the process to protect their market share rather than serve patients. ### **8\. What is the connection between CON laws and Kentucky's provider shortages?** Shortages of critical providers, made worse by CON laws that make it costly to expand services, have lengthened wait times and forced patients to drive long distances for specialty care. Of Kentucky's 120 counties, 114 are classified as primary care health professional shortage areas and 115 as mental health shortage areas, with rural counties hit hardest. Kentucky needs more than 420 additional primary care and mental health professionals to resolve these shortages. ### **9\. Are there real examples of Kentucky's CON laws denying care?** Yes. In 2017, two Nepali immigrants tried to open a Louisville home health agency serving Nepali-speaking residents who could not find care in their native language; the application was opposed by one of Kentucky's largest home health providers and rejected because existing supply already met the state's numeric standard of "need." In 2019, a $24 million ambulatory surgical center in Fort Mitchell was derailed after more than two years of litigation by a rival hospital system, depriving about 170,000 Kenton County residents of additional outpatient surgical options. In 2022, the state denied a UofL Health application to convert 33 acute care beds into 33 adult psychiatric beds, even though the hearing officer acknowledged the formulas used to determine community need were likely flawed. ### **10\. Do CON laws actually improve access to care?** Research consistently finds that CON laws restrict supply and protect existing providers, with little evidence that they expand access. States that repealed hospital CON laws saw hospital facilities increase by about 3.8% in rural areas and 3.9% in urban areas over the following two decades, a pattern consistent with stronger competition and broader patient choice. ### **11\. How do CON laws affect behavioral health and substance use treatment?** CON restrictions on substance use disorder treatment facilities are associated with higher emergency department use and worse outcomes for vulnerable populations, and substance abuse CON laws can reduce facilities' acceptance of private insurance, shaping who can access care. Kentucky has about 70 residential substance use disorder treatment beds per 100,000 residents, one of the highest rates in the country, roughly 3 to 4 beds in a community of 5,000\. Policymakers continue to debate whether CON rules help maintain that capacity or limit how quickly providers can expand when demand rises. ### **12\. Do CON laws improve health care quality?** Supporters argue CON laws improve quality by concentrating procedures in high-volume facilities, but the evidence offers little support. Comparisons of CON and non-CON states find worse outcomes on several measures: the 30-day mortality rate for heart failure is about 0.2 percentage points higher in CON states (about two more deaths per 1,000 discharges), the pneumonia rate is about 0.38 points higher (about four more deaths per 1,000), and mortality among surgical inpatients with serious treatable complications is about six deaths per 1,000 discharges higher. ### **13\. What did the COVID-19 pandemic reveal about CON laws?** During the pandemic, states with bed-specific CON requirements had higher hospital bed utilization and were more likely to operate near or at full capacity. In states with high bed utilization, temporary CON reforms were associated with reductions of roughly 20 COVID-19 deaths and 30 deaths from natural causes per 100,000 residents, plus about 3 fewer deaths per 100,000 from other respiratory conditions needing similar resources. Kentucky issued temporary emergency orders easing some requirements to expand capacity. ### **14\. Do CON laws reduce health care spending?** No. The literature concludes that CON laws have not reliably reduced health care spending and may instead limit competition without delivering clear cost savings. ### **15\. Don't CON laws protect rural hospitals?** Supporters say limiting entry protects thin-margin rural hospitals and preserves their ability to cross-subsidize uncompensated care. But the empirical evidence on whether CON laws prevent cost shifting or strengthen financial stability is mixed, and the literature does not clearly show these laws protect access for vulnerable populations. Because states that repealed CON laws saw hospitals increase in both rural and urban areas, entry restrictions may not be necessary to preserve rural facilities. ### **16\. Is there a link between CON laws and mortality?** On average, states with CON programs have 8% higher premature mortality than states without them. Premature mortality measures the gap between a person's age at death and their life expectancy, reflecting early deaths from causes such as unmanaged chronic disease and drug overdoses that better access to care could prevent. On this measure, Kentucky ranks seventh worst in the United States. ### **17\. What reforms does the brief recommend?** The brief proposes six evidence-based reforms, none of which requires immediate, full repeal: raise the project review thresholds so intensive review is reserved for high-dollar projects; streamline the review, hearing and appeal process with clear guidance and firm timelines; prevent conflicts of interest by limiting who can trigger hearings and basing decisions on patient needs rather than incumbents' market share; exempt high-need services such as mental health and substance use treatment, as well as rural providers, from CON review; eliminate CON requirements for lower-cost alternatives to hospital care such as ambulatory surgical centers, dialysis centers, home health agencies and hospice; and codify emergency flexibility through an automatic suspension of CON requirements during declared public health emergencies. ### **18\. Has Kentucky made any progress on CON reform?** Yes. Kentucky has already taken an important step by easing CON restrictions on birth centers, which the brief cites as an example of the kind of targeted exemption that can expand access to high-need services. ### **19\. Why does this issue matter for Kentuckians?** Kentucky's CON laws are among the most restrictive in the nation and have reduced access to vital health care services. The real impact is not just inconvenience or higher costs but a lower quality of life. A large body of evidence indicates that straightforward, incremental reforms would reduce the power of entrenched interests, encourage entrepreneurship and investment, and better align Kentucky's health care rules with its population's needs, all while maintaining safety oversight. --- *Based on the Bluegrass Institute policy brief "*[*Certificate-of-Need Laws in Kentucky: Current Status and Opportunities for Evidence-Based Reforms*](https://www.bluegrassinstitute.org/certificate-of-need-laws-sigaud-orozco/)*" by Liam Sigaud and Edgar Orozco.* ### Caleb O. Brown discusses tax reform and solutions to Kentucky’s housing crisis on Kentucky’s Voice URL: https://www.bluegrassinstitute.org/caleb-o-brown-discusses-tax-reform-and-solutions-to-kentuckys-housing-crisis-on-kentuckys-voice/ Last updated: 2026-06-29T14:52:40.000Z Tom Fawbush of Kentucky's Voice interviews Caleb O. Brown on housing reform, tax reform, and educational freedom in Kentucky. ### Caleb O. Brown discusses Kentucky’s housing crisis and education reforms on Kentucky Politics Weekly URL: https://www.bluegrassinstitute.org/video-kentuckys-housing-crisis-and-education-reforms/ Last updated: 2026-06-24T12:38:29.000Z Caleb O. Brown discusses Kentucky’s housing crisis and education reforms on the Kentucky Politics Weekly program. ### Richard Innes’ op-ed is read on WVLK’s Kruser & Krew program URL: https://www.bluegrassinstitute.org/richard-innes-op-ed-is-read-on-wlvks-kruser-krew-program/ Last updated: 2026-06-22T12:45:08.000Z Richard Innes’ op-ed, “[How Did Audits Miss FCPS’ Financial Woes for So Long?](https://www.bluegrassinstitute.org/fcps-financial-woes/),” was read on-air on WVLK’s Kruser & Krew program. ### Cassius Marcellus Clay: Kentucky’s Original Free Speech Champion URL: https://www.bluegrassinstitute.org/cassius-marcellus-clay/ Last updated: 2026-06-19T14:00:49.000Z The Declaration of Independence’s pledge of liberty to all people was only effective if there were those willing in subsequent generations to fulfill that promise. It was not yet a matter of fact in 1776\. Liberty required champions—often obscure and endangered—who forced the promise into practice. Within a generation of the founding, Kentucky gave the nation one of the most fearless of them. [Cassius Marcellus Clay](https://archive.org/details/lifeofcassiusmar00inclay/page/n5/mode/2up) didn’t fit the mold of an abolitionist firebrand. He was born into great wealth. His father, Green Clay, was a Revolutionary War veteran, a settler of Kentucky, a surveyor, a delegate in both the Virginia and Kentucky legislature, and a representative to the Virginia Ratifying Convention for the U.S. Constitution—and a prominent slave owner. The younger Clay was surrounded by slavery as a child. His initial objections to the institution were on economic grounds more than moral concerns. This was especially emphasized as he traveled to study at Yale University, where he could clearly see the contrast in economic prosperity between a free state and a slave state like Kentucky. ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) After hearing William Lloyd Garrison speak at a church near Yale, Clay engaged himself fully as a fierce and fearless opponent of slavery, and he brought the fight home to the front lines of Kentucky. Clay’s encounter with Garrison also solidified another instinct he held, whether he realized it at the time or not. Free and open dialogue was the key to defeating such a powerful institution as slavery. If people were free to debate and engage in open discourse, as Garrison did during his lectures and through *the Liberator*, the defense of slavery would be revealed as shallow and antithetical to the principles of the American founding. Clay returned to Kentucky in 1832 and found himself in the state legislature by 1835\. Alongside Robert J. Breckenridge, Clay was slavery’s most vocal opponent in the Kentucky House of Representatives. He boldly denounced it as evil—“morally, economically, physically, intellectually, religiously, politically—evil in its inception, in its duration, and in its catastrophe.” As Clay continued to force the issue of slavery on Kentuckians, he left politics in 1841 and entered directly into the arena of ideas. He reveled in the opportunity to debate slavery, in spite of the increasingly common episodes of violence that the issue provoked. In 1843, at a public debate, Clay barely survived an assassination attempt. A hired gunman, Samuel Brown, shot him in the chest, aiming at his heart. He only survived because, as Brown approached, Clay quickly withdrew his Bowie knife, raising his silver-tipped sheath in the bullet’s path by doing so. A bloody brawl resulted, and Clay slashed Brown’s nose in two and removed one of his eyes. For his part, Clay thought he was mortally wounded, but walked away with a mere red mark over his heart. It was a gruesome affair, but friend and foe alike now understood that Clay would not be intimidated or coerced into silence. Clay grew in his defiance against the slavocracy and the mob alike. In June 1845, he started an anti-slavery newspaper in Lexington called [*The True American.*](https://www.lexpublib.org/digital-archives/collection/true-american?ref=bluegrassinstitute.org#:~:text=The%20True%20American%20was%20an%20anti%2Dslavery%20newspaper,printing%2C%20and%20his%20press%20shipped%20to%20Cincinnati.) He received death threats almost immediately. He received one letter calling him “meaner than the autocrats of hell” and warning that his life “cannot be spared. Plenty thirst for your blood—are determined to have it.” Rather than discarding the note, he publicized it, intending to show the depravity of the slave power. Clay was constantly armed by this point with two pistols and his trusted bowie knife. He also bought two brass four-pounder cannons and armored the doors of the press to keep the mobs out. In August, he published an incendiary editorial entitled “What is Become of the Slaves in the United States?” The public was completely outraged and called for the *True American* to cease publication. On August 18th, after obtaining a court injunction against the paper, a mob of 60 seized and dismantled the press. Clay, suffering from typhoid fever at the time, was too sick to stop it. Despite this setback, Clay was not deterred. By October, he reopened his press in Cincinnati and still edited the paper in Kentucky. It continued operation for the next two years. He also used the incident as one of the clearest examples of how slavery is incompatible with a free, constitutional republic. “For they did well see,” remarked Clay in reflection of the incident, “from a brief experience, that slavery and a free press could not live together.” August 18th marked the day that “the Constitutional liberties of Kentucky \[were\] overthrown; and an irresponsible despotism of slaveholding established in their ruins.” Clay’s name would continue to grow in prominence throughout the nineteenth century. Though never to the level of his cousin, Henry Clay, he went on to serve in the Mexican-American War, the Civil War, and as Ambassador to Russia. He was even considered as Lincoln’s Vice President in 1860\. He lived the life of a fighter, always prepared to defend the principles of liberty as he understood them. Today, Cassius Marcellus Clay is remembered mostly for his commitment to the cause of emancipation. It’s an appropriate legacy to honor. But it’s equally appropriate to honor Clay for his commitment to and understanding of the principles of free speech. Today, as we navigate our own challenges to free speech, we should heed Clay’s fearless example. --- [*Bluegrass Institute*](https://www.bluegrassinstitute.org/) *scholar* [*Caleb Franz*](https://www.bluegrassinstitute.org/author/caleb-franz/) *is the Program Manager at* [*Young Voices*](https://www.joinyv.org/staff/caleb-franz?ref=bluegrassinstitute.org)*, and the author of* [The Conductor: The Story of Rev. John Rankin, Abolitionism’s Essential Founding Father](https://www.amazon.com/Conductor-Rankin-Abolitionisms-Essential-Founding/dp/1637589891/ref=sr%5F1%5F1?crid=3C49JHCEUKMNX&dib=eyJ2IjoiMSJ9.TxsSAyEINC0wGzExgua13XIGOWfNWidtpQJjIBNghsSh8cwaEPzA2eiNU9lgN9%5FgHKWan0ZW4iiFmGAUQGJrQjs6ENyn-JRF6qiZj0-4FNzQZ9XA8bNPgiPQ0TfAbJQfKxhxLoPlCgiSFgzNj2wK0qpPfr2-cELun7LpN1enUkCf6tKNoWhyhJKoiqYJzLwEsOik4BMf3KFBCcuEpC9Ldh8q6vF-qBAF37ZX2gLKIBn7wka2arDjwWlp0b6ITGhep3nvEthBLX2J3UtcXhs0q46N5pfGgvG22xXudRpAYGY.VOlx8krAKiBaBeFKR7Oo9oJfWgaBpJDX2k%5FIVWRYgnc&dib%5Ftag=se&keywords=the+conductor+by+franz&qid=1721325503&sprefix=the+conductor+%2Caps%2C118&sr=8-1&ref=bluegrassinstitute.org)*.* ### Tobacco policy should reflect the world as it is URL: https://www.bluegrassinstitute.org/tobacco-world-as-it-is/ Last updated: 2026-06-15T12:08:17.000Z *This piece first appeared in the* [*Washington Examiner*](https://www.washingtonexaminer.com/restoring-america/fairness-justice/4602411/tobacco-policy-should-reflect-world-as-it-is/?ref=bluegrassinstitute.org)*.* --- If [reports](https://theconversation.com/flavored-vapes-led-to-a-major-shake-up-at-the-fda-3-health-policy-analysts-explain-the-science-behind-the-controversial-products-283048?ref=bluegrassinstitute.org) are correct that Food and Drug Administration Commissioner Marty Makary resigned under pressure from the White House to approve flavored nicotine [vaping](https://www.washingtonexaminer.com/tag/vaping/?ref=bluegrassinstitute.org) products, the episode says a great deal about the state of American [tobacco](https://www.washingtonexaminer.com/tag/tobacco/?ref=bluegrassinstitute.org) policy. Cigarettes remain legal, ubiquitous, and extraordinarily deadly. Yet smoke-free alternatives that may help adults move away from combustible tobacco continue to trigger political panic out of proportion to the actual public health trade-offs involved. There is something deeply unserious about how Washington talks about nicotine. Cigarettes, the most dangerous products in the category, remain widely available. Smoke-free alternatives, however, are often treated as if their very existence is beyond the pale. That disconnect has fueled a regulatory debate that is too often driven by [moral panic](https://www.cato.org/blog/what-causing-nicotinophobia?ref=bluegrassinstitute.org) over nicotine rather than by outcomes. The debate has drifted far from outcome-based [public health](https://www.washingtonexaminer.com/tag/public-health/?ref=bluegrassinstitute.org) policy. The FDA’s recent [approval of several flavored](https://www.fda.gov/tobacco-products/market-and-distribute-tobacco-product/e-cigarettes-vapes-and-other-electronic-nicotine-delivery-systems-ends-authorized-fda?ref=bluegrassinstitute.org) smoke-free products has sparked outrage from [familiar quarters](https://www.nbcnews.com/health/vaping/trump-flavored-vapes-fda-authorization-backlash-maha-health-officials-rcna345192?ref=bluegrassinstitute.org), with critics arguing that any legal pathway for flavored alternatives is inherently reckless. Sen. Dick Durbin (D-IL) [posted on X](https://x.com/SenatorDurbin/status/2057122145575055485?ref=bluegrassinstitute.org) that “these products addict children & expose them to harmful chemicals.” An adult smoker standing at a convenience-store counter does not face an abstract policy debate. That person faces real choices: continue smoking cigarettes, buy an illicit product of uncertain origin, or try a legal alternative that has undergone review. Any regulatory system that ignores those real-world choices loses touch with reality. The public health standard Congress created recognizes exactly that reality. The FDA is supposed to assess effects on the population as a whole, not pretend that adult smokers do not exist. That requires regulators to weigh risks to youth while also accounting for the possible benefits of moving adult smokers away from combustible cigarettes, which remain uniquely deadly. Studies suggest that nicotine e-cigarettes are the [most effective](https://www.nejm.org/doi/full/10.1056/NEJMoa1808779?ref=bluegrassinstitute.org) tobacco cessation tools. [Surveys of adult tobacco smokers](https://pmc.ncbi.nlm.nih.gov/articles/PMC8500174/?ref=bluegrassinstitute.org) reveal that they find it easier to quit with flavored vapes. Much of the [evidence suggests](https://pubmed.ncbi.nlm.nih.gov/33991190/?ref=bluegrassinstitute.org#affiliation-1) that vaping has displaced rather than expanded youth tobacco use. Youth smoking rates [fell dramatically](https://filtermag.org/teens-vaping-smoking/?fbclid=IwAR24El3vuFpo0MKtMvRMFo%5FU1k0v-bcbVpYLKlhd1zzfv7y9vtilW7rCSUE&ref=bluegrassinstitute.org) during the rise of e-cigarettes, and both youth smoking and youth vaping have declined in recent years, reaching an [all-time low](https://clearingtheair.eu/en/post/us-youth-vaping-continues-to-fall-as-cigarette-smoking-nears-historic-low/?ref=bluegrassinstitute.org) in 2025. A credible regulatory system requires a legal, science-based pathway for the appropriate review of smoke-free products. Without such a pathway, the market moves into the shadows. Unauthorized products continue to flood convenience stores, gas stations, and online sellers. Adults are left with fewer regulated options, and youth protections become harder to enforce. In this scenario, the government signals that legal compliance is for suckers, while the illicit market sets the terms. Few would support allowing children access to nicotine products. That is why strict enforcement, age-verification measures, marketing restrictions, and retailer accountability all matter. But public policy for adults should not be built around standards designed for minors. Nor should the response be to erase all distinctions between legal and illegal products or between combustible cigarettes and smoke-free alternatives. Public health is not advanced by pretending those differences are meaningless. Too much of this debate has devolved into performance and moral signaling. Support a lawful pathway for smoke-free alternatives, and you are accused of not caring about kids. Suggest that adults should have access to lower-risk options, and you are treated as if you have abandoned public health entirely. That framing may generate applause and outrage, but it is no substitute for serious policymaking. Adults who smoke deserve a system that is honest, consistent, and grounded in evidence. They need a government that can distinguish between products that meet the legal standard and those that do not. And they need policymakers willing to admit that reducing smoking-related disease sometimes requires embracing imperfect solutions that are better than the status quo. The FDA should be judged on whether it builds a system that protects youth, respects the law, and gives adult smokers a realistic pathway away from combustible cigarettes. That is what serious regulation looks like. The country needs policymakers willing to confront the realities of nicotine use, consumer behavior, and illicit markets. --- *Caleb O. Brown is chief executive officer of the Bluegrass Institute. Jeffrey A. Singer, MD, practices general surgery in Phoenix and is a senior fellow at the Cato Institute.* ### How did audits miss FCPS’ financial woes for so long? URL: https://www.bluegrassinstitute.org/fcps-financial-woes/ Last updated: 2026-06-11T12:08:35.000Z *This piece first appeared in the* [*Lexington Herald-Leader*](https://www.kentucky.com/opinion/article316075568.html?ref=bluegrassinstitute.org)*.* --- By now, a Lexington resident would have to be a recluse to not know that the area’s public school system is facing major financial problems. Coverage of issues like a [$16 million budget shortfall](https://www.kentucky.com/news/local/education/article311755144.html?ref=bluegrassinstitute.org#storylink=cpy) and a contingency fund that might be only around $15 to $22 million — not the supposed $42 million — has gotten just about everyone’s attention. You cannot avoid paying attention when the district’s 2024-25 general fund budget deficit was on the order of [$38.9 million](https://www.kentucky.com/news/local/education/article315157768.html?ref=bluegrassinstitute.org), according to a CPA interviewed by the Herald-Leader to examine the district’s financials. One can only wonder what is going on when the district’s new, chief interim financial officer admits [the district grossly overestimated revenue](https://www.kentucky.com/news/local/education/article315921212.html?ref=bluegrassinstitute.org#storylink=cpy) from property, motor vehicle and occupational taxes. Things got more odiferous when the Herald-Leader reported “[Emails show suspended FCPS budget director warned of needed cuts](https://www.kentucky.com/news/local/education/article312113792.html?ref=bluegrassinstitute.org)” after former district Budget director Ann Sampson-Grimes’ lawsuit broke. The suit alleges she was improperly removed from her position after trying to inform district leadership about serious budget issues. All of this has been covered well in area media. But a closely related issue that might stretch well beyond Lexington has received no attention, so far. It is reported that [fiscal reporting problems for Fayette County Public Schools stretch back to 2008](https://www.kentucky.com/news/local/education/article315509154.html?ref=bluegrassinstitute.org). How can that be? [State law](https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=3159&ref=bluegrassinstitute.org) requires every school district’s financials to be audited annually. In fact, there is even a high-level [State Committee for School District Audits](https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=3159&ref=bluegrassinstitute.org), chaired by the Auditor of Public Accounts and staffed by other state leaders — including the governor — that meets at least quarterly and is charged with overseeing this process. However, Fayette County’s problems were not discussed in the committee’s meeting minutes from [March 13, 2025](https://www.auditor.ky.gov/cpatools/PublishingImages/Lists/SCSDA%20Meeting%20Minutes/AllItems/SCSDA%20Minutes%20for%20March%2013,%202025%20FINAL.pdf?ref=bluegrassinstitute.org), or [June 12, 2025](https://www.auditor.ky.gov/cpatools/Documents/SCSDA%20Minutes%20for%20June%2012,%202025%20Minutes%20FINAL.pdf?ref=bluegrassinstitute.org). The [December 3, 2025, meeting minutes](https://www.auditor.ky.gov/cpatools/PublishingImages/Lists/SCSDA%20Meeting%20Minutes/AllItems/SCSDA%20Minutes%20for%20December%203rd,%202025%20-%20FINAL.pdf?ref=bluegrassinstitute.org) only say FCPS had submitted its annual report. There is no other mention and [there are no minutes posted for meetings shown as tentatively scheduled for March 2026](https://www.auditor.ky.gov/cpatools/Pages/SCSDA.aspx?ref=bluegrassinstitute.org). To be sure, [Annual Financial Revenues and Expenditures](https://www.education.ky.gov/districts/FinRept/Pages/Fund%20Balances,%20Revenues%20and%20Expenditures,%20Chart%20of%20Accounts,%20Indirect%20Cost%20Rates%20and%20Key%20Financial%20Indicators.aspx?ref=bluegrassinstitute.org) reports from the Kentucky Department of Education explicitly indicate that Fayette County’s fiscal reports were indeed audited from at least 2010-11 and later. So, how did such a long series of annual audits miss the fiscal issues FCPS now faces? Why were the audits ineffective? Is anyone even questioning this obvious problem — KDE or KBE? How about that State Committee for School District Audits? Anyone? What’s more, if the audit process failed to spot issues in Fayette County, how can the public be sure that similar issues don’t exist in other districts? Clearly, it’s time for the legislature and that State Committee for School District Audits to take a serious look at this. Maybe other agencies need to get involved, too. After all, a lot of tax money might have vanished, but right now, when the quality of audits is in question, who can tell? ### Kentucky’s open door on government transparency is closing URL: https://www.bluegrassinstitute.org/open-door-transparency/ Last updated: 2026-06-09T14:50:59.000Z *This piece first appeared in the* [*Kentucky Lantern*](https://kentuckylantern.com/2026/06/08/kentuckys-open-door-on-government-transparency-is-closing/?ref=bluegrassinstitute.org)*.* --- Kentucky built its Open Records Act on a simple, powerful premise: that free and open examination of public records is in the public interest. For nearly 50 years, that premise provided a basic guarantee that Kentuckians could see what their government was doing in their name. That premise is now under a growing threat — from the legislature, and increasingly from the courts. Two recent developments, taken together, reveal how quickly a transparency framework can erode. Last year [House Bill 520 took effect](https://kyopengov.org/blog/hb-520-takes-effect-june-27-get-your-requests-investigative-records-now?ref=bluegrassinstitute.org), fundamentally restricting Kentuckians’ right to access records in a criminal investigation. In April the [Kentucky Supreme Court issued a ruling](http://opinions.kycourts.net/sc/2023-SC-0524-DG.pdf?ref=bluegrassinstitute.org) narrowing the definition of what constitutes a “public record” in ways that open a significant loophole for officials who wish to conduct government business out of public view. **The legislative retreat: HB 520** The story of [HB 520](https://kyopengov.org/blog/hb-520-takes-effect-june-27-get-your-requests-investigative-records-now?ref=bluegrassinstitute.org) begins with a court victory for transparency. In Shively Police Department v. Courier-Journal, the Kentucky Supreme Court reaffirmed that law enforcement agencies could not simply invoke the secrecy of an open investigation to withhold every record in a file. The court rejected the long-held view that a separate statute authorized blanket nondisclosure of entire files while ignoring the required showing of actual harm, simply because the files relate to an open investigation and possible prosecution. ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) The court’s logic was sound: a blanket presumption of harm from disclosure of any record in an ongoing investigation would turn on its head the Open Records Act’s basic presumption of openness and relieve law enforcement agencies of their statutory obligation to separate excepted materials from unexcepted materials. The legislature’s response was swift and telling. Six months after the Kentucky Supreme Court clarified the law enforcement exception, legislators moved to restore the upper hand to law enforcement — relieving them of the statutory duty to separate excepted materials from unexcepted materials. The critical mechanism was a subtle but devastating change in language. [HB 520 substitutes “could” for “would”](https://kyopengov.org/blog/kentucky-open-government-coalition-statement-hb-520?ref=bluegrassinstitute.org) — a hypothetical or speculative risk of harm, rather than an actual risk of concrete harm based on the individual record’s content, is now sufficient to deny the public access to records in an open investigation. This word swap is not a technicality. It is a philosophical reversal. Under the old standard, an agency had to demonstrate that a specific record’s release would cause concrete harm. Under HB 520, any agency can point to the fact that an investigation is open and speculate that disclosure could “taint the jury pool” or “influence witness testimony.” Those phrases can apply to virtually any investigation, at any stage. Some investigations are deemed open for decades — in one extreme case, for 25 years, and another, in excess of 40 years. A standard based on “could” rather than “would” is no standard at all. [Open government advocates](https://kyopengov.org/?ref=bluegrassinstitute.org) pointed this out plainly during the legislative process. No open government advocate opposed HB 520 on the grounds that it allows agencies to articulate reasons for denial or that it enables a requester to appeal to the Attorney General — these protections have existed for decades. The objection was precisely to the dilution of the harm requirement. Sen. [Greg Elkins](https://legislature.ky.gov/Legislators/Pages/Legislator-Profile.aspx?DistrictNumber=128&ref=bluegrassinstitute.org), a Republican from Winchester, voiced discomfort during committee, saying the word “could” seemed too broad. Sen. [Cassie Chambers Armstrong](https://legislature.ky.gov/Legislators/Pages/Legislator-Profile.aspx?DistrictNumber=119&ref=bluegrassinstitute.org) echoed concerns that HB 520 could shift the power to decide whether an open records exemption applies from courts to law enforcement agencies themselves. Those concerns did not prevail. It is rarely curiosity — and almost never a desire to compromise an investigation — that drives the public to submit open records requests for law enforcement records. It is far more often the public interest in ensuring that law enforcement agencies are properly executing their statutory functions, in gauging the threat to community safety, and in the most compelling cases, in enabling a grieving family to search for and find answers in the face of official silence over long years. HB 520 makes that search harder. **Private devices and public business** If HB 520 represents the legislature’s assault on transparency, the [Kentucky Supreme Court’s April 2026 ruling](http://opinions.kycourts.net/sc/2023-SC-0524-DG.pdf?ref=bluegrassinstitute.org) in Kentucky Department of Fish and Wildlife Resources Commission v. Kentucky Open Government Coalition represents a different kind of threat — one born not of bad faith, but of legal formalism that produces troubling practical results. The facts were revealing. Commission members were not provided with governmental email accounts; instead, the Commission’s own website listed members’ private email addresses as their contact information. When the [Kentucky Open Government Coalition](https://kyopengov.org/?ref=bluegrassinstitute.org) requested communications between commission members and legislators, the Commission declined to produce records on private devices, citing an Attorney General opinion that documents solely in the possession of individuals on their personal devices are not public records. The Supreme Court ultimately agreed. The court concluded that private records in the exclusive ownership and control of individual commission members on their private cell phones and in their private email accounts are not “public records” held by a “public agency” for purposes of the Open Records Act. The reasoning rested on constitutional distinctions between “members of boards and commissions” and “inferior state officers” — a distinction formalized by a 1992 constitutional amendment — and on the logic that commission members can only officially act when meeting together as a body. The court was candid about the risk it was accepting. It acknowledged the concern raised by the lower courts that bad actors with nefarious intent might subvert the Open Records Act by using private devices to conduct government business, but concluded this alleged “loophole” cannot justify reclassifying private documents as public ones in contravention of the clear language of the ORA. The court passed the problem to the legislature, noting it is within the General Assembly’s authority to require all governmental volunteers to be issued government email accounts, or to declare that each commission member constitutes a “public agency” for purposes of the law. That deference may be legally appropriate. It is nonetheless deeply unsatisfying. The court itself acknowledged that this case exposed the problems inherent in not providing commission members with the means to conduct government business in a way that would automatically create records the Commission can review and use to respond to open records requests. When the same legislature that passed HB 520 is also the body the court is relying upon to close this loophole, there is little reason for optimism. **A pattern, not an accident** The [Bluegrass Institute](https://bluegrassinstitute.org/?ref=bluegrassinstitute.org), the [Kentucky Open Government Coalition](https://kyopengov.org/?ref=bluegrassinstitute.org), the [ACLU of Kentucky](https://www.aclu-ky.org/?ref=bluegrassinstitute.org), and [Americans for Prosperity Kentucky](https://ky.americansforprosperity.org/?ref=bluegrassinstitute.org) share a commitment to the principle that government must be transparent and accountable. For some of us, that principle begins with making government at all levels more transparent and responsive to the taxpayers who fund it, shining light on corrupt contracts and illegal secret meetings. For some of us that principle begins with expanding public awareness of open records and open meetings laws and to preserving what remains of these once robust laws. In any case, those commitments reflect a broader understanding: government secrecy is not a conservative, progressive or libertarian value. It is a government value — one that serves government institutions instead of people. What is happening in Kentucky is a pattern. Proposals have emerged to eliminate the court appeals process for denied requests for legislative branch records, replace the Attorney General with the Legislative Research Commission as decision-maker on open record petitions, and exclude non-Kentucky residents from accessing records under the Open Records Act. State legislatures watch one another. If a state succeeds in passing laws that decrease transparency and accountability, they become an example for another state to follow. The machinery of accountability does not break all at once. It rusts quietly — through word changes in statutes, through the practical consequences of court rulings, through the slow accumulation of loopholes that each, in isolation, seem defensible. When transparency advocates urge Kentuckians to [file open records requests before new laws take effect](https://kyopengov.org/blog/hb-520-takes-effect-june-27-get-your-requests-investigative-records-now?ref=bluegrassinstitute.org), they are not being alarmist. They are being realistic about how access disappears: not with a proclamation, but with a deadline. Kentucky’s Open Records Act has survived for nearly half a century because successive generations understood this: The public’s right to know is not a mere courtesy extended by government. It is a condition of self-governance. That condition is now being renegotiated — and the public, by and large, is not at the table. The time to insist on a seat is now. --- [*Caleb O. Brown*](https://www.bluegrassinstitute.org/author/calebobrown/) *is CEO of the*[ *Bluegrass Institute*](https://www.bluegrassinstitute.org/)*. Amye Bensenhaver, a director at the* [*Kentucky Open Government Coalition*](https://kyopengov.org/?ref=bluegrassinstitute.org)*, is a retired assistant attorney general whose 25-year career in the Kentucky Attorney General’s Office focused exclusively on the Open Records and Meetings laws.* [*Kate Miller*](https://www.aclu-ky.org/bios/kate-miller/?ref=bluegrassinstitute.org) *is advocacy director at the*[ *ACLU of Kentucky*](https://www.aclu-ky.org/?ref=bluegrassinstitute.org)*. Heather LeMire is state director for*[ *Americans for Prosperity Kentucky*](https://ky.americansforprosperity.org/?ref=bluegrassinstitute.org)*.* ### There's no reason to keep KY laws limiting healthcare access URL: https://www.bluegrassinstitute.org/con-cj/ Last updated: 2026-05-28T12:03:52.000Z *This piece first appeared* [*in the Louisville Courier-Journal*](https://www.courier-journal.com/story/opinion/contributors/2026/05/27/kentucky-healthcare-provider-hospital-certificate-of-need-general-assembly/90195273007/?ref=bluegrassinstitute.org)*.* --- In 2017, [two Nepali immigrants](https://ij.org/case/kentucky-con/?ref=bluegrassinstitute.org) in Louisville tried to open a home health agency to serve neighbors who couldn't find care in their own language. The state turned them down. Louisville already had enough home health providers by the state's count — never mind that none of them spoke Nepali. Two years later, a proposed $24 million ambulatory surgical center in Fort Mitchell [collapsed](https://law.justia.com/cases/kentucky/court-of-appeals/2019/2018-ca-001096-mr.html?ref=bluegrassinstitute.org) after a rival hospital tied it up in court for more than two years. About 170,000 Kenton County residents lost out on additional outpatient surgery options. Kentucky has [less than half](https://www.beckersasc.com/uncategorized/first-ever-ranking-of-all-50-states-by-asc-per-capita/?ref=bluegrassinstitute.org) the national average of ambulatory surgical centers per capita. In 2022, UofL Health [asked to convert](https://ij.org/wp-content/uploads/2023/07/ME-final-order.pdf?ref=bluegrassinstitute.org) 33 acute care beds into 33 adult psychiatric beds. The state said no, even after the hearing officer acknowledged the formulas used to measure "need" were probably flawed. These are the predictable results of Kentucky's certificate of need laws, which require state permission before a provider can open a clinic, add beds or buy major equipment. On one widely used measure of CON stringency, Kentucky [scores](https://ciceroinstitute.org/wp-content/uploads/2024/12/50-State-CON-Rankings-Report-12-5-2024.pdf?ref=bluegrassinstitute.org) a perfect 100\. Indiana scores 15\. Ohio scores 5\. Both are adding health care capacity [faster than Kentucky](https://onlinelibrary.wiley.com/doi/10.1002/soej.12686?ref=bluegrassinstitute.org). **The cost of CON regulations** CON laws were sold in the 1970s as a tool to control costs and prevent duplication. After 50 years, the evidence shows they did neither. What they reliably do is give incumbent hospitals leverage over potential competitors. When an existing provider formally opposes a CON application in Kentucky, the [approval rate drops](https://ij.org/wp-content/uploads/2023/08/Kentucky-CON-Report-Aug.-2023.pdf?ref=bluegrassinstitute.org) from 71% to 43% percent, and the average decision takes nearly twice as long. Plenty of would-be providers look at that process and never bother applying. The costs show up in the data. States with CON programs have 8% higher premature mortality than states without them. Kentucky ranks seventh-worst in the country on years of life lost before age 75\. Heart failure patients in CON states are [more likely](https://www.mdpi.com/1911-8074/15/6/272?ref=bluegrassinstitute.org) to die within 30 days. So are pneumonia patients. So are surgical patients with treatable complications. Meanwhile, 114 of Kentucky's 120 counties are [federally designated](https://www.kff.org/other-health/state-indicator/primary-care-health-professional-shortage-areas-hpsas/?currentTimeframe=0&selectedRows=%7B%22states%22:%7B%22kentucky%22:%7B%7D%7D%7D&sortModel=%7B%22colId%22:%22Total%20Primary%20Care%20HPSA%20Designations%22,%22sort%22:%22desc%22%7D&ref=bluegrassinstitute.org) primary care shortage areas. 115 are mental health shortage areas. Kentucky needs more than 420 additional primary care and mental health providers just to meet basic adequacy benchmarks. The current regulatory regime makes it harder, not easier, for providers to set up in the counties that need them most. Fixing this doesn't require dismantling the whole system at once, even if we’d encourage that. There are a handful of straightforward steps the General Assembly can take. **An unkept promise** Raise the dollar thresholds that trigger CON review so routine renovations and equipment upgrades aren't dragged through months of paperwork. Set firm timelines for decisions and limit the ability of competitors to weaponize hearings against rivals. Exempt mental health and substance use treatment from CON entirely — given the overdose toll across Eastern Kentucky and the Ohio River counties, there is no defensible reason to keep gatekeeping psychiatric beds and treatment facilities. Exempt rural providers so investment can flow where shortages are worst. End CON requirements for lower-cost alternatives to hospital care, including ambulatory surgical centers, dialysis, home health and hospice. And codify emergency flexibility, so the next public health crisis doesn't require an executive order to let hospitals add beds. Most of these reforms have already been tried elsewhere. Indiana and Ohio didn't fall apart when they pared back their CON programs. Their patients ended up with more choices and shorter drives. The defense of Kentucky's CON regime rests on a promise it has not kept: that restricting supply lowers costs and protects rural hospitals. The research doesn't support either claim. What CON actually does is protect the providers who got there first. It is common sense that we shouldn’t let McDonalds decide if a Chick-fil-a is allowed to open nearby. We should follow this to its logical conclusion. Kentuckians deserve a health care system built around patients, not incumbents. The evidence is clear: the General Assembly should start dismantling the worst of these laws in the coming session. --- *Caleb O. Brown is the CEO of the Bluegrass Institute. Liam Sigaud is a research analyst with the Knee Regulatory Research Center working within the fields of health and labor economics. Edgar Orozco is a third-year Ph.D. student in economics at West Virginia University concentrating in health and urban economics.* *This piece is based on the recent Bluegrass Institute report* [*Certificate-of-Need Laws in Kentucky: Current Status and Opportunities for Evidence-Based Reforms*](https://www.bluegrassinstitute.org/certificate-of-need-laws-sigaud-orozco/)*.* ### Certificate-of-Need Laws in Kentucky: Current Status and Opportunities for Evidence-Based Reforms URL: https://www.bluegrassinstitute.org/certificate-of-need-laws-sigaud-orozco/ Last updated: 2026-05-21T12:03:35.000Z ## Executive Summary Certificate of need (CON) laws artificially restrict the supply of health care services, causing shortages, reducing quality, and increasing prices by stifling competition. These laws require health care providers to obtain state approval before initiating certain projects. CON regulations were intended to decrease health care costs by preventing the unnecessary duplication of medical services and ensuring equitable access to care. While these policies were well-intentioned, the evidence overwhelmingly indicates that CON laws have not achieved their goals. Informed by decades of research and practical experience, many states are rolling back their CON laws or repealing them altogether. Yet, despite the growing recognition that these laws are counterproductive, Kentucky retains some of the country’s most restrictive CON rules. This policy brief describes Kentucky’s health care challenges, examines its current CON laws, summarizes relevant empirical research, and discusses evidence-based CON reforms that would improve access and competition in Kentucky’s health care system. [Certificate-of-Need Laws in Kentucky20260521\_CON.pdf1 MBdownload-circle](https://www.bluegrassinstitute.org/content/files/2026/05/20260521%5FCON.pdf "Download") ## Kentucky’s Health Care Landscape: Shortages, Affordability Challenges, and Infrastructure Needs While health insurance coverage in the commonwealth has reached historic highs over the past decade, Kentuckians still struggle to receive timely, high-quality care. Shortages of critical health care providers, exacerbated by CON laws that make it costly to expand services, have lengthened wait times for routine appointments and forced patients to drive long distances for specialty care. Low levels of competition in the health-care sector have also led existing providers to raise prices, exacerbating access problems for people with low incomes. ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) These shortages are such a critical problem—and not just in Kentucky—that the federal government has labeled and studied them. Health professional shortage areas (HPSAs) are areas that lack the health care infrastructure to provide adequate services to the local population. Of Kentucky’s 120 counties, 114 are classified as primary care HPSAs and 115 are classified as mental health HPSAs. Shortages are particularly common in rural counties. Kentucky needs more than 420 additional primary care and mental health professionals to resolve these shortages. Figure 1 shows Kentucky’s HSPAs. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/05/figure1-1.png) Making care inaccessible does not reduce Medicaid spending. Kentucky’s Medicaid budget is one of the fastest-growing components of state spending, with these dollars often spent on expensive, late-stage interventions in traditional hospital settings rather than less-costly preventive and earlier-stage care. Without a regulatory environment that encourages primary care clinics and lower-cost surgical centers to open, Kentuckians will continue to face a health care system that is difficult to access, expensive for both patients and taxpayers, and increasingly unable to meet the needs of an aging population. On average, states with CON programs have 8% higher premature mortality than states without these regulations. Premature mortality quantifies the gap between a person’s age at death and their life expectancy. As such, it reflects early deaths from causes such as unmanaged chronic diseases, certain infectious diseases, and drug overdoses that could have been prevented through better access to health services and supports. On this measure, Kentucky ranks seventh worst in the United States. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/05/figure2-1.png) There are many real-world examples of Kentucky’s CON laws undermining access to care. Here are three that illustrate the laws’ care-denying consequences. In 2017, a pair of Nepali immigrants attempted to open a home health agency in Louisville to provide services to Nepali-speaking residents who could not find services in their native language. The entrepreneurs’ CON application was opposed by one of Kentucky’s largest providers of home health care. Because Louisville’s existing supply of home care services already met the state’s standard of “need” based purely on number of patients, state officials rejected the CON application. The importance of customized services to accommodate language-specific communities had not been contemplated in the state health plan, so officials deemed this critical aspect of the project irrelevant in deciding whether to grant a CON. In 2019, an effort to obtain a CON to build a $24 million ambulatory surgical center in Fort Mitchell was derailed after more than two years of litigation initiated by a rival hospital system. This action, which deprived about 170,000 residents of the surrounding Kenton County of additional outpatient surgical options, was taken despite the fact that Kentucky, on a population-adjusted basis, has less than half as many ambulatory surgical centers as the U.S. average. In 2022, Kentucky denied a CON application by UofL Health to convert 33 acute care beds into 33 adult psychiatric beds, despite the hearing officer acknowledging that the arbitrary formulas used to determine community need were likely flawed. These incidents reveal how well-intentioned regulations can be manipulated to serve corporate interests rather than advance the common good. ## Certificate-of-Need (CON) Laws in Kentucky Kentucky’s CON laws constitute one of the most extensive regulatory gatekeeping systems in the nation. They cover 19 specific types of facilities, from hospitals and psychiatric facilities to highly specialized facilities like kidney disease centers, hospices, and even home health agencies (see table 1). ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/05/table-1.png) Depending on the proposed project’s capital expenditure, CON application fees can reach $25,000\. In addition, Kentucky’s CON process is so bureaucratic and convoluted that applicants often find it necessary to partner with expensive law firms specializing in CON law. A recent analysis examined every CON application submitted in Kentucky from 2019 to mid-2023\. During that time, 98 complete applications underwent substantive (formal) review, of which 71% were approved. However, incumbent providers are given broad latitude to challenge CON applications from potential competitors or to demand additional hearings to delay entry. When would-be competitors opposed the CON application, the approval rate plummeted to 43% and the average time to reach a final decision nearly doubled, from 5.4 months for unopposed applications to 10.2 months for opposed applications. Still more applications were likely never submitted due to the costly and time-consuming process. Further, Kentucky does not merely require CON approval to open a new health care facility. Existing providers must obtain a new CON for a wide variety of activities, including capital expenditures that exceed certain thresholds, substantially increasing bed capacity or health services, acquiring major medical equipment, or altering a location designated on a previous CON. Figure 3 compares Kentucky’s CON restrictions to those in its seven bordering states. Kentucky’s score of 100 out of 100 indicates CON barriers in every category measured. Only two bordering states received the same maximum score for CON stringency. By contrast, Indiana and Ohio have eliminated most of their CON regulations and received the lowest (best) scores. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/05/figure3-1.png) ## How CON Laws Affect Patients’ Access to Health Care Research consistently concludes that CON laws restrict supply and protect existing providers. It offers little evidence that CON laws expand access. Rather, states that repealed hospital CON laws saw an increase in hospital facilities of approximately 3.8% in rural areas and 3.9% in urban areas over the ensuing two decades. This pattern is consistent with stronger competition and broader choices for patients. Research also suggests that CON laws can be consequential in high-need areas such as behavioral health. CON restrictions on substance use disorder treatment facilities are associated with higher emergency department use and worse health outcomes for vulnerable populations. Other work finds that substance abuse CON laws impact how treatment facilities structure payment, including reduced acceptance of private insurance, which may shape who can access care. In Kentucky, behavioral health capacity remains a central policy concern. The state has about 70 residential substance use disorder treatment beds per 100,000 residents, one of the highest rates in the country and well above the national average, highlighting the scale of treatment demand and infrastructure in the state. This translates to roughly 3 to 4 treatment beds in a community of 5,000 residents, emphasizing both the importance of treatment infrastructure and the challenges small rural areas face in maintaining access to care. While this reflects substantial treatment capacity, policymakers continue to debate whether existing regulatory structures, including CON requirements, help maintain this capacity or instead limit how quickly providers can expand services when demand increases. ## How CON Laws Affect Health Care Quality Another longstanding claim is that CON laws improve health care quality by preventing “excess capacity” and concentrating services in high-volume facilities, The argument is that when providers perform certain procedures more frequently, they gain experience and achieve better patient outcomes, so limiting the number of providers may help ensure that services are delivered by higher volume facilities. However, the empirical evidence offers little support for this argument. Analyses comparing hospitals in CON and non-CON states find that several mortality measures are worse in CON states. The 30-day mortality rate for heart failure is about 0.2 percentage points higher, meaning that for every 1,000 heart-failure patients discharged from the hospital, an additional two die in CON states. For pneumonia patients, the 30- day mortality rate is approximately 0.38 percentage points higher in CON states, implying four additional deaths per 1,000 discharges. Mortality among surgical inpatients with serious treatable complications is also higher in CON states, averaging about six more deaths per 1,000 discharges. In short, the research does not show consistent quality improvements attributable to CON regulations, and in some cases it suggests the opposite. ## How CON Laws Affect Health System Capacity and Costs During the COVID pandemic, states with bed-specific CON requirements experienced higher hospital bed utilization rates and were more likely to operate near or at full capacity, suggesting tighter supply conditions. Separate research finds that in states with high hospital bed utilization, temporary CON reforms during the pandemic were associated with reductions of approximately 20 COVID-19 deaths and 30 deaths from natural causes per 100,000 residents, along with roughly 3 fewer deaths per 100,000 from other respiratory-related conditions requiring similar hospital resources. Kentucky issued temporary emergency orders that eased certain regulatory requirements to expand hospital capacity in response to surging demand. These temporary waivers highlight that existing regulatory requirements can limit flexibility during sudden surges in demand and may require emergency intervention to allow providers to expand capacity quickly. More broadly, the literature concludes that CON laws have not reliably reduced health care spending and may instead limit competition without delivering clear cost savings. ## How CON Laws Affect Cost-Shifting and Rural Hospital Stability Many states, including Kentucky, face hospital closures that have significant community impact. CON supporters argue that limiting entry helps protect small rural hospitals from competition that may threaten already thin operating margins and reduce their ability to sustain essential services. The concern is that if new providers enter the market and concentrate on higher-margin services, rural hospitals may struggle to operate profitably. A frequent concern among policymakers is that repealing CON laws may encourage new entrants to focus on the most profitable service lines, such as cardiac, orthopedic, or imaging services, while leaving full-service hospitals responsible for treating uninsured patients and providing less profitable services such as emergency or trauma care. Under this view, CON laws help preserve hospitals’ ability to cross-subsidize uncompensated care and to maintain broader service offerings. However, empirical evidence on whether CON laws effectively prevent cost shifting or strengthen financial stability is mixed, and the broader literature does not clearly demonstrate that these regulations reliably protect access to care for vulnerable populations. Empirical research also does not consistently support the claim that CON laws improve rural access or stability. Evidence from states that repealed CON laws shows increases in the number of hospitals in both rural and urban areas, suggesting that entry restrictions may not be necessary to preserve rural facilities. ## Evidence-Based Reforms to Kentucky’s CON Laws Kentucky’s CON laws represent barriers to entry that prioritize the protection of incumbent businesses over patient access and market innovation. The commonwealth has an opportunity to modernize Kentucky’s approach while preserving appropriate health and safety oversight. The reforms below would ensure the state’s health system can expand and respond when and where patients need care. Many of these changes have been successfully implemented in other states. None of these reforms requires an immediate, full repeal of Kentucky’s CON program. ### 1\. Raise project review thresholds. Kentucky should reserve intensive CON reviews for high-dollar projects most likely to affect regional capacity planning and public spending. Raising the capital expenditure and major medical equipment expenditure thresholds that trigger CON review would reduce red tape for routine expansions, renovations, and upgrades that can improve access and reduce wait times—especially in underserved communities. ### 2\. Streamline the review, hearing, and appeal process. Clear guidance, accessible advisory opinions, and firm timelines for review would reduce administrative burdens and encourage investment. When providers do not know how rules will be applied—or fear that projects will be stalled in extended hearings or appeals— many choose not to proceed. Improving predictability and transparency can help restore confidence in the process. ### 3\. Prevent conflicts of interest in the CON review process. Reforms should limit who can trigger hearings and prolong proceedings. Instead of allowing existing providers to formally oppose new applicants, decisions should be based on clear evidence and consistent rules that focus on the needs of patients and communities rather than protecting the market share of existing providers. ### 4\. Exempt high-need services from CON regulations. Exempting mental health and substance use treatment services from CON regulations would help ease Kentucky’s persistent shortages in psychiatric hospital care and chemical dependency programs. Similarly, exempting rural providers from CON review would help direct investment to underserved communities. Kentucky has already taken an important step in this direction by easing CON restrictions on birth centers. ### 5\. Eliminate CON laws for lower-cost alternatives to hospital care. Kentucky should eliminate CON requirements for services that are unlikely to be overused and that frequently provide lower-cost alternatives to hospital care. This includes ambulatory surgical centers, dialysis centers, home health agencies, hospice care, and other specialized treatments. Access to these services is already constrained by insurance oversight and medical standards, making additional entry barriers unnecessary. ### 6\. Codify emergency flexibility. Introduce greater CON flexibility to improve health system resilience during public health emergencies. Kentucky’s ad hoc CON policy changes during the pandemic allowed providers to expand services and capacity more rapidly than usual but also created significant uncertainty for providers. Establishing a statutory automatic suspension of CON requirements during declared public health emergencies would help ensure that providers can scale capacity quickly when it is needed most. ## Conclusion Kentucky’s CON laws are among the most restrictive in the nation and have reduced access to vital health care services. The real impact of these laws is not just inconvenience or increased costs, but a lower quality of life for Kentuckians. A large body of evidence indicates that straightforward reforms to Kentucky’s CON laws would yield tangible benefits for patients. Modest, incremental changes can reduce the power of entrenched interests, empower entrepreneurship, attract investment to the health care sector, and better align Kentucky’s health care regulations with the current needs of its population—all while maintaining safety oversight. [Certificate-of-Need Laws in Kentucky: Current Status and Opportunities for...20260521\_CON.pdf1 MBdownload-circle](https://www.bluegrassinstitute.org/content/files/2026/05/20260521%5FCON-1.pdf "Download") --- *Liam Sigaud is a Research Analyst with the* [*Knee Regulatory Research Center*](https://knee.wvu.edu/?ref=bluegrassinstitute.org) *working within the fields of health and labor economics.* *Edgar Orozco is a third-year Ph.D. student in economics at West Virginia University concentrating in health and urban economics.* ### The bill for Fayette County school mismanagement was always going to come due URL: https://www.bluegrassinstitute.org/the-bill-for-fayette-county-school-mismanagement-was-always-going-to-come-due/ Last updated: 2026-05-13T12:51:31.000Z The headlines coming out of Fayette County Public Schools this week are painful. Library technicians shown the door. Technology staff let go. Work calendars slashed for librarians, child nutrition workers, and school law enforcement. [Holly Brooks](https://www.kentucky.com/news/local/education/article315574021.html?ref=bluegrassinstitute.org), an instructional resource technician, says her entire five-person team was eliminated–a team that processed more than 20,000 library books last year and logged nearly 5,100 visits to the Teacher Resource Center. Eight technology employees were let go the same day. Another [laid-off employee estimates around 100 Central Office positions](https://www.kentucky.com/news/local/education/article315584044.html?ref=bluegrassinstitute.org) were cut for the coming school year–a figure the district has declined to confirm. These are real people who had nothing to do with how the district got here. ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) Interim Chief Financial Officer Kyna Koch [now acknowledges](https://www.kentucky.com/news/local/education/article315561270.html?ref=bluegrassinstitute.org) that FCPS financial records have been misstated for years. Some of the failures have now been traced as far back as 2008\. But misreporting alone does not explain how a district arrives at this moment. The deeper problem started well before anyone touched the books. **More Staff, Fewer Students, Lower Scores** The Bluegrass Institute published a [detailed analysis of FCPS staffing trends](https://www.bluegrassinstitute.org/but-what-about-staffing/) last fall. From 2010-11 to 2023-24, certified staff grew 18% and classified staff grew 12%–even as average daily attendance declined after COVID-19\. Over the same period, the average ACT composite for 11th graders fell from 20.1 to 18.9\. More staff, fewer students attending, lower scores. The analysis found that the district continued increasing staff even as post-pandemic attendance dropped, resulting in approximately 314 more employees than enrollment trends would have justified. That mismatch was always there, accumulating--it was simply invisible as long as the books said otherwise. [Koch noted pointedly that not three years ago, FCPS carried a contingency balance of more than $90 million--and it has nearly disappeared](https://www.wkyt.com/2026/04/23/fayette-county-schools-provide-financial-operations-update/?ref=bluegrassinstitute.org). That did not happen because of bad bookkeeping alone. It happened because the district was spending it, on a payroll that had grown disconnected from the students it was meant to serve. **The Ratchet** Public school districts operate in a political environment that makes staffing reductions extraordinarily difficult. Union contracts, job rights, and understandable sympathy for people who work with children create powerful resistance to any headcount reduction–even when enrollment shrinks. The result is a ratchet: staffing goes up readily and comes down only under duress, in exactly the kind of emergency that inflicts the most harm on the employees those protections were meant to shield. Laid-off employee Tia Brown [put it plainly](https://www.kentucky.com/news/local/education/article315584044.html?ref=bluegrassinstitute.org): while there is extensive bloat at the top, many low-level Central Office employees were working tirelessly to help schools. State Rep. Adrielle Camuel, herself an FCPS employee, called the layoffs devastating–dedicated public servants shown the door through no fault of their own, facing one of the tightest job markets in recent memory as casualties of financial mismanagement involving tens of millions in taxpayer dollars. **The Right Lesson** The current crisis is being framed almost entirely as a bookkeeping failure. That framing is incomplete. If Lexington focuses only on the accounting irregularities and not on the staffing structure that made this crisis so severe, the same story will repeat itself once the auditors leave. [I recommended last fall that the FCPS board conduct a comprehensive staffing audit,](https://www.bluegrassinstitute.org/but-what-about-staffing/) establish metrics linking hiring to student outcomes, and create transparent reporting to keep staffing and enrollment aligned. That recommendation is more urgent today. The people losing jobs this week are paying for decisions made long before them, across multiple administrations, in a governance culture that never required staffing to justify itself against enrollment. That has to change--before the next crisis, not during it. --- Read Richard's October 25, 2025 analysis *But What About Staffing?: Comparing Fayette County Public Schools’ staffing trends to enrollment and academic performance* [here](https://www.bluegrassinstitute.org/but-what-about-staffing/). ### Evaluating Kentucky’s Assessment Results: Part 2, The SAT Switch URL: https://www.bluegrassinstitute.org/assessment-results-part-2/ Last updated: 2026-05-05T12:01:24.000Z *This paper is Part 2 of a series; Part 1 is available* [*here*](https://www.bluegrassinstitute.org/evaluating-kentuckys-assessment-results-data-omissions-and-governance/)*.* ## Executive Summary Kentucky’s decision to replace the ACT with the SAT as its statewide 11th-grade college admissions exam represents a significant and poorly managed change to the state’s assessment system—one that weakens accountability, raises questions about statutory compliance, and demands immediate legislative and state school board attention. For nearly two decades, Kentucky’s annual administration of the ACT college entrance test to all 11th grade students has produced the longest continuous and comparable measure of student performance in the state. That trend line shows a sustained decline in achievement since 2016-17, including across English, mathematics, reading, and science (see Figures 1 & 2). These results stand in sharp contrast to more favorable outcomes reported on the Kentucky Summative Assessments (KSA) for high schools, raising serious concerns about how accurately current state assessments reflect true student performance. Figure 1 ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/05/figure1.png) Figure 2 ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/05/figure2.png) Despite the importance of this information, ACT results were omitted from key public communications and largely excluded from state board discussions in late 2025\. At the same time, the Kentucky Department of Education (KDE) moved forward—without required stakeholder involvement—to replace the ACT with the SAT beginning in 2026, effectively ending an 18-year trend line. This is not a routine substitution. The ACT and SAT are fundamentally different tests, and widely accepted concordance methods do not support constructing a valid longterm trend across them. As a result, Kentucky is losing its most reliable tool for tracking changes in student performance over time—particularly at a moment when policymakers need clear evidence about recovery from the impacts of COVID. ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) The process used to make this decision also raises serious governance concerns. Kentucky law requires the Kentucky Board of Education to oversee the assessment system and mandates consultation with multiple advisory bodies. Available evidence suggests that these requirements were not fulfilled prior to the decision to switch tests. In addition, the SAT does not directly assess all subject areas required by statute— specifically English and science—as distinct tested domains. This raises unresolved questions about whether the new assessment complies with Kentucky law. The consequences of this decision extend beyond governance. The abrupt transition gives districts and students limited time to adjust to a different test format, potentially disadvantaging students who had been preparing for the ACT, particularly in less-resourced districts. Taken together, these issues point to a breakdown in transparency, oversight, and accountability in Kentucky’s assessment system. The state is losing its most valuable long-term performance measure at a time when that information is most needed, while the replacement assessment is not directly comparable and does not appear to meet statutory requirements. Legislators and the Kentucky Board of Education should act to restore proper oversight, ensure compliance with state law, and preserve the ability to accurately measure student performance over time. Without such action, Kentucky risks operating an assessment system that provides less clarity, less accountability, and less confidence for policymakers and the public alike. ## Background Kentucky law clearly establishes both the structure of the state’s assessment system and the responsibilities for overseeing it. Those requirements are especially important in light of findings from Part 1 of this report series, which raised concerns about incomplete data presentation, omitted results, and inconsistencies in trends between state and national assessments. Under KRS 158.6453, the Kentucky Board of Education is responsible for creating and implementing a balanced statewide assessment program. The statute also requires that all 11th-grade students take a college admissions examination that assesses four specific subject areas: English, reading, mathematics, and science. This requirement is explicit. However, as discussed in Part 1 and expanded upon here, the SAT does not directly assess all of these areas as distinct components. While it includes reading, writing, and mathematics, it does not provide a standalone science assessment and does not report a separate English score, either. No clear explanation has been provided to date demonstrating how the SAT can fully satisfy the statutory requirements. KRS 158.6453 also requires that the assessment system be developed with input from multiple entities.5 Specifically, the Board must seek advice from: - the Office of Education Accountability (OEA), - the School Curriculum, Assessment, and Accountability Council (SCAAC), - the Education Assessment and Accountability Review Subcommittee (EAARS), and - the department’s technical advisory committee. These consultations are not optional. They are built into statute to ensure that major decisions about the state’s assessments are transparent, well-informed, properly coordinated with other interested parties and subject to appropriate oversight. The role of the Education Assessment and Accountability Review Subcommittee (EAARS) is particularly significant. Under KRS 158.647, EAARS is charged with advising the Board on implementation of the state’s assessment and accountability system, providing an additional layer of legislative oversight. A change as significant as replacing the ACT with the SAT—especially one that eliminates nearly two decades of comparable performance data—would reasonably be expected to involve the EAARS and all of the other entities. However, available evidence indicates that such involvement did not occur. There is no clear record of meaningful consultation with EAARS or the other required groups, and the Kentucky Board of Education itself does not appear to have substantively reviewed or approved the change in its 2025 meetings. The importance of these safeguards is underscored by events during the state board’s December 2025 meeting, as discussed in Part 1\. That report showed that discussion of key assessment data—the ACT results—was completely omitted from the results presented to the state board in December 2025\. This likely occurred because the ACT trends conflicted with the more favorable picture the Kentucky Department of Education presented based primarily on the Kentucky Summative Assessments (KSA). Clearly, the board was denied a full and thorough picture of the state’s real performance. In light of those omissions, the role of advisory bodies and the Board itself becomes even more critical to ensuring that decisions are based on complete and accurate information about the 2025 assessment results. Findings from Part 1 raise broader concerns: major decisions affecting Kentucky’s assessment system appear to be occurring without full transparency, without complete consideration of available data, outside of compliance with state law and without the level of oversight required by law. ## The Limits of Comparing the ACT and SAT Replacing the ACT with the SAT is not a simple substitution. The two tests differ in design, content, and scoring—and those differences have important implications for accountability. *Both testing organizations acknowledge these limitations. According to the Guide to the 2018 ACT®/SAT® Concordance:* > **The ACT and the SAT are different tests.* The ACT and the SAT measure similar, but not identical, content and skills. A concorded score is not a perfect prediction of how a student would perform on the other test.* The guidance further explains the concordance is intended only for comparing individual performances at approximately the same point in time—not for constructing long-term trends. It explicitly warns: > **Concordances are used to compare individual scores, not aggregate scores.** Users should avoid converting aggregate scores (e.g., mean, median, ranges) using concordance tables, as this could introduce additional sources of error*.* This has direct implications for Kentucky. Nearly two decades of ACT data cannot be reliably converted into SAT equivalents. The state’s most consistent measure of student performance cannot be preserved using the concordance. The problem is compounded by timing. The most recent concordance was developed in 2018, before very recent major changes to the SAT occurred. Even if the revised SAT Kentucky is going to use wasn’t going to be different from earlier SAT versions, the available concordance is dated. The result is clear: switching to the SAT breaks Kentucky’s only long-term, comparable trend line—at a time when policymakers most need consistent data to evaluate recovery from the impacts of COVID. ## The SAT Kentucky Will Use Is a Redesigned Assessment The SAT Kentucky plans to administer is not simply a different version of a familiar test. It is a redesigned, digital, adaptive assessment that differs in structure, content, and reporting. ### Digital and Adaptive Format Under the state’s contract, the SAT will be administered primarily in digital form, with paper testing limited to certain students with disabilities or exceptional circumstances.9 This represents a fundamental shift in testing conditions that is going to favor students with better digital skills. Per KDE’s News Advisory 25-237, the new SAT is also adaptive. Students do not all receive the same questions. Instead, performance on the first set of questions determines the difficulty of later questions. As a result, early mistakes can limit a student’s opportunity to demonstrate higher-level proficiency. Obviously, students will not all receive the same test. This will complicate–perhaps totally prohibit–the ability to provide truly equitable scoring. Left unexplained is how special students who take a paper and pencil test can possibly take anything close to an equivalent to the predominant digital test. Equivalent scoring for these students is even more unlikely. The new SAT is also shorter than past versions, with fewer questions overall. This increases the impact of each response. As one analysis notes: > With fewer questions on the test, small mistakes have a bigger impact. This is especially true for students aiming for high scores—missing just one or two additional questions can shift a score significantly. ### Changes in Rigor and Content The shorter format of the new SAT raises concerns about the depth and rigor of what is being assessed. According to the James G. Martin Center for Academic Renewal: > …in the new ‘Reading and Writing’ section of the test, they shortened reading passages from 500-750 words all the way down to 25-150 words, or the length of a social-media post, with one question per passage. The same analysis notes that these changes necessarily resulted in the removal of longer, more complex reading material: > This resulted in the elimination of significant portions of SAT’s previously used reading material, including “passages in the U.S. founding documents/Great Global Conversation subject area,” because of their “extended length.” Nevertheless, the College Board takes the view that the rigor of the Reading and Writing segment is 7 unchanged. They claim in the assessment framework that the eliminated reading passages are “not an essential prerequisite for college” and that the new, shorter content helps “students who might have struggled to connect with the subject matter. These changes raise legitimate questions about whether the new SAT assesses reading comprehension and analytical skills at the same depth as earlier formats. ### Reduced Diagnostic Value At the same time, reporting from the SAT has become less detailed. According to Open Door Education: > The lack of detailed breakdowns makes it harder for students to identify specific areas for improvement. This means that targeted prep requires additional assessment tools beyond the official reports. This reduction in diagnostic information limits the usefulness of the test for educators and students seeking to improve performance. ### Subject Coverage and Validity Concerns The shift to the SAT raises important questions about how required subject areas are assessed. Kentucky law requires testing in English, reading, mathematics, and science. The SAT directly assesses reading, writing, and mathematics, but it does not include a standalone science test. #### Limited science testing Instead, the SAT proposes to generate a science-related score based on performance on selected questions embedded within other sections. This differs from the ACT, which includes a dedicated science assessment designed specifically to measure those skills. This distinction matters. A derived score based on a limited number of embedded items is not equivalent to results from a separate and focused assessment. Concerns are heightened by the digital SAT’s shorter format. With fewer total questions, and questions of shorter length than previous SAT versions, any science-related score will be based on a very limited evidence base, raising serious questions about reliability and validity. In addition, due to the limited number of questions on the digital SAT, it seems inevitable that deriving anything close to a valid science score will require a large number of questions in the reading and writing sections to be biased towards science topics. That puts students better versed in subjects like civics, history and other non-science areas at a disadvantage, making the reading and writing sections more like a science test than a true evaluation of reading and writing in general. #### No unique English score The SAT does not report English as a distinct subject area. This further complicates compliance with statutory requirements which are aimed at producing a specific score for student performance in areas such as grammar and punctuation. This statutory requirement was likely inserted because of experiences in the early days after the Kentucky Education Reform Act of 1990 was passed. Back then, progressive educators downplayed the importance of the technical aspects of writing. It became clear to legislators that was not a good idea. Taken together, these differences make it difficult to determine whether the new digital SAT fully meets Kentucky’s legal requirements. More importantly, there is a more fundamental concern: will the assessment system continue to measure the subjects the state needs to assess, and will the resulting scores provide a sound basis for accountability? ## How the Transition Occurred The transition from the ACT to the SAT was not only a major policy change—it was carried out in ways that raise concerns about transparency, data reporting, and oversight. These issues involve both how the decision was made and how student performance has been communicated. Together, they call into question whether policymakers have been given a complete and accurate picture of educational outcomes. ### 1\. Lack of Transparency in the Transition The transition from the ACT to the SAT was not conducted in a transparent, collaborative or well-documented manner. The process began in early 2025, when the Kentucky Department of Education initiated procurement for the state’s required 11th-grade college admissions examination. This apparently occurred without public discussion with the state board or clear notice to other key stakeholders. By June 13, 2025, a contract had already been executed to replace the ACT with the SAT. Two weeks later, June 27, 2025, the Kentucky Board of Education was informed by email (not in an open meeting of the board) and another three days went by before district assessment coordinators were informed. At this point, there was little to no awareness among district leaders, the media, or the public that such a significant change was under consideration—let alone finalized. This lack of transparency extended to entities identified in statute, including the Kentucky Board of Education and advisory bodies such as EAARS, OEA, and SCAAC, none of which appear to have been meaningfully involved prior to the decision—despite statutory requirements. Also left uninformed until after the contract was signed was the Kentucky Council on Postsecondary Education. The council’s Amanda Ellis wrote on July 1, 2025, that higher education leaders “were unaware of this change and are surprised to learn of the quick implementation.” Ellis also stated that in the past the council had been advised about the requests for proposals, so “this has become a very big deal for our campuses.” Ellis additionally wanted to know which higher education representative had served on the assessment review committee required to advise on such issues by state law. She also mentioned that the change in tests would impact the Kentucky Higher Education Assistance Authority, which has an important role in awarding state-funded scholarships. Coverage in the Courier-Journal made it clear that local school districts were also left out of the process. Awareness of the change emerged gradually and informally. District personnel first learned of the shift through the email sent to assessment coordinators— not through formal communication to superintendents or a public announcement. At least some district leaders were highly unhappy about the change. Elizabethtown Independent Schools superintendent Paul Mullins pointed out that KDE’s change would impact many years of investment in ACT support activities for things like practice exams and training. Jim Flynn, with the Kentucky Association of School Superintendents, said, “there really wasn’t any warning about it.” He added that districts now faced “a pretty short runway” to get students up to speed on a new assessment. Public disclosure followed only well after the decision had effectively been made. A statewide advisory was not issued until September 2025—more than three months after the contract was signed. This rushed and non-transparent sequence of events has practical consequences. The ACT and SAT differ in structure, pacing, and content. Preparing students for one does not fully prepare them for the other. Adjusting instructional strategies, test preparation, and student expectations requires time and resources—both of which were constrained by the delayed communication of this change. Districts with fewer resources are particularly challenged under such conditions. In short, a major change to Kentucky’s assessment system—one that affects every public high school student—was implemented with limited transparency, minimal stakeholder involvement, and a compressed timeline for adaptation. ### 2\. Limited Disclosure of ACT Results At the same time the transition to the SAT was unfolding, the presentation of assessment data raises additional concerns about transparency and completeness. When statewide results were released in November 2025, official communications focused heavily on Kentucky Summative Assessment (KSA) outcomes. However, the official news release did not include any ACT results even though those results are a required component of the state’s assessment system and represent its longest-running trend line of student performance. The ACT data were technically available through the Kentucky School Report Card system, but that availability was not prominently reported or emphasized in official releases. As a result, the ACT results received limited attention from both policymakers and the media, who were largely left unaware that such data was even available. This omission is significant. At the same time the state was preparing to discontinue this assessment, the most recent ACT results showed continued declines, not the improvement KDE tried to claim in the December 2025 state board meeting. Through January 2026, ACT results continued to be omitted from state board discussions, even as other data—including even NAEP results from prior years—were presented. As documented in Part 1 of this report series, this selective omission occurred in a context where ACT trends conflicted with the more favorable picture presented by the KSA. As earlier discussed, the ACT results did show a sustained decline in student performance since 2016–17 across English, mathematics, reading, and science (see Figure 2). In contrast, KSA results suggest modest improvement. Presenting one set of results without the other creates an incomplete—and potentially misleading—understanding of system performance. The timing of these omissions is also notable. The state minimized the visibility of ACT results at the same time it was preparing to replace the ACT entirely. As a result, one of the few independent and longitudinal measures of student performance was both underemphasized and ultimately removed. The pattern extended into early 2026\. At its January meeting, the Board did not review ACT results and deferred further discussion until May—after the legislative session had concluded. ### 3\. Incomplete Presentation of Trends Despite the state board’s January announcement that the ACT results would not be examined until May, the February 2026 board agenda included a presentation on the ACT. However, the ACT scoring information presented to the board in February was incomplete. The materials provided to the Board focused only on results from 2017 to 2025, totally omitting earlier years when performance had improved (see Figure 3). Figure 3 ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/05/figure3.png) The truncated presentation provided to the state board removes really important information. The full ACT trend shows there were notable earlier gains followed by subsequent, serious declines that have completely erased those earlier gains. By excluding the earlier period, the materials presented to the board prevented the members from understanding the full, and very disappointing, trajectory of student performance. Given the ACT’s 36-point scoring scale, the decline from a peak composite score of 19.8 in 2016–17 to 18.1 in 2024–25 is substantial. Without the full trend in view, the magnitude and persistence of that decline are not apparent. Kentucky lost a decade of earlier progress on ACT, but the state board was denied that information. For policymakers responsible for oversight, access to complete trend data is essential. Partial presentations can obscure important patterns and weaken informed decision-making. This situation raises an important concern: whether Kentucky’s assessment system is providing a full and balanced picture of student outcomes, or whether key, but disturbing, data are being suppressed at the moment they are most relevant. ## A Pattern That Raises Concern Each of these issues—the lack of transparency in the transition process, the limited visibility of ACT data, and the incomplete presentation of trends—raises concerns on their own. Taken together, they point to a broader pattern. A major policy decision was made with limited public explanation and minimal stakeholder involvement. At the same time, key performance data were not consistently presented or emphasized. Oversight processes required by statute do not appear to have functioned as intended. An appearance has been created that troubling assessment data has been discarded to portray a brighter picture than the full evidence can support. Some of these issues may simply reflect poor administrative decisions or communication problems. However, the cumulative effect creates a picture of a system in which decision-making, data reporting, and oversight are not fully aligned with expectations for transparency and accountability. For legislators and the Kentucky Board of Education, the central issue is not simply which test is used. It is whether the state’s assessment system continues to provide a clear, accurate, and trustworthy picture of student performance. At present, that question remains unresolved. ## Recommended Actions The issues outlined in this report point to a major problem: Kentucky’s assessment system is not operating with the level of transparency, stability, and oversight required to support sound policymaking and may not be in compliance with state law. At a time when lawmakers and education leaders most need clear and reliable information—particularly to understand recovery from the impacts of COVID—the state has eliminated its longest-running and most consistent measure of student performance. At the same time, key data have been underemphasized or omitted, and a major change to the assessment system appears to have been made without the full involvement of the entities required by law. These concerns require action from both the Kentucky Board of Education and the General Assembly. ### For the Kentucky Board of Education The Board should immediately reassert its statutory responsibility over the state’s assessment system. First, the Board should conduct a formal review of the decision to replace the ACT with the SAT, including whether the process complied with KRS 158.6453 and whether required advisory bodies were consulted. Second, the Board should require a clear and public determination of whether or not the SAT fully meets statutory requirements to assess English, reading, mathematics, and science. If that standard cannot be met, the Board should reconsider the use of the SAT. Third, the Board should ensure full transparency in the reporting of assessment data. All major statewide results—including college admissions testing—should be consistently presented in board meetings and included in official public releases. Presentation of partial, and slanted, results must not continue. Finally, the Board should establish clear expectations for complete and accurate data presentation going forward, including the use of full trend lines and appropriate statistical interpretation. In short, the Board must move beyond a passive role and actively govern the assessment system it is charged with overseeing. ### For the Kentucky General Assembly The legislature, which holds ultimate responsibility for education in the commonwealth, should take steps to restore accountability, clarity, and public confidence. First, the General Assembly should investigate the process that replaced the ACT with the SAT, including the timeline, procurement process, level of board involvement, and whether statutory consultation requirements were followed. Second, legislators should determine whether the SAT complies with existing statutory requirements. If it does not, corrective action should be required. Third, the legislature should act to preserve or restore meaningful longitudinal accountability. This may include requiring a return to the ACT or establishing a clear, legislatively approved plan to maintain comparable performance measures over time. Fourth, the General Assembly should consider creating an independent assessment oversight body to develop assessments, evaluate results and report directly to policymakers and the public. Separating responsibility for assessment from responsibility for the programs to improve education would reduce conflicts of interest and improve credibility. Finally, legislators should clarify governance roles within the assessment system to ensure that major decisions cannot be made without proper oversight and transparency. ## Conclusion Kentucky cannot afford an assessment system that obscures more than it reveals. Without clear, consistent, and credible measures of student performance, neither policymakers nor the public can accurately judge whether the state’s education system is improving. Restoring transparency, preserving meaningful trend lines, and enforcing proper oversight are essential steps toward ensuring that Kentucky’s assessment system serves its intended purpose: providing an honest and reliable picture of how well the state’s students are being prepared for the future. [Evaluating Kentucky’s Assessment Results: Part 2, The SAT Switch202605 Bluegrass\_ACT to SAT.pdf2 MBdownload-circle](https://www.bluegrassinstitute.org/content/files/2026/05/202605-Bluegrass%5FACT-to-SAT.pdf "Download") ### Would Jacqueline Coleman bring sound education policy into the governor’s office? URL: https://www.bluegrassinstitute.org/would-jacqueline-coleman-bring-sound-education-policy-into-the-governors-office/ Last updated: 2026-04-27T14:36:16.000Z Kentucky Lt. Gov. Jacqueline Coleman is running for governor. She’s spent years as Governor Andy Beshear’s point person on education both as lieutenant governor and Secretary of the Education and Workforce Development Cabinet. As a long-time participant in education policy for the commonwealth, it is appropriate that the Bluegrass Institute discuss and assess gubernatorial candidate Coleman’s positions in this regard. We conclude that, examined carefully, her record raises serious questions about the policies she would bring to the Governor's office. ## **The Good News** Lt. Gov. Coleman has championed a handful of education-related policy reforms that are worthy of praise. She has advocated for making the GED free for first-time test takers, which is now law. The cost of [GED testing](https://kyae.ky.gov/Students/Pages/earn-ged-diploma.aspx?ref=bluegrassinstitute.org) is a small but real hurdle to Kentuckians seeking employment absent a high school diploma. ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) More broadly, Coleman appears to recognize some key factors limiting workforce development: inadequate consideration from Kentucky’s public schools to help meet private sector workforce needs, and the proliferation of bureaucratic hurdles that can impede individuals seeking education to boost their employment prospects. Given Kentucky’s status as [one of the most restrictive states with respect to occupational licensing](https://www.bluegrassinstitute.org/boost-kentuckys-labor-market-reform-occupational-licensing/), Coleman could be amenable to dismantling the regulatory barriers that hinder employment for a wide variety of skilled workers. ## **The Pre-K Letdown** Coleman has been the Beshear administration’s [most vocal advocate for universal pre-kindergarten](https://www.courier-journal.com/story/opinion/contributors/2025/10/03/kentucky-school-pre-k-for-all-kids-family-beshear/86435666007/?ref=bluegrassinstitute.org). The political appeal is obvious: Who could be against helping Kentucky’s youngest learners get a head start? But the [research on universal pre-K programs is far more sobering than rhetoric suggests](https://www.bluegrassinstitute.org/universal-pre-k-is-an-expensive-experiment/). Many studies of the federal Head Start program, such as [a randomized research effort released in 2012](https://files.eric.ed.gov/fulltext/ED539264.pdf?ref=bluegrassinstitute.org), have shown that “[positive impacts on literacy and language development demonstrated by children who entered Head Start at age 4 had dissipated by the end of 3rd grade.](https://www.edweek.org/teaching-learning/head-start-advantages-mostly-gone-by-3rd-grade-study-finds/2012/12?ref=bluegrassinstitute.org)” A more recent, [rigorous study of a scaled, statewide public pre-K program](https://www.npr.org/2022/02/10/1079406041/researcher-says-rethink-prek-preschool-prekindergarten?ref=bluegrassinstitute.org) in Tennessee that extended findings to upper grades found that children who attended pre-K actually scored lower on state achievement tests in third and sixth grade than comparable children who did not attend. The negative effects grew larger over time. By sixth grade, pre-K participants were more likely to be placed in special education. Lead researcher Dale Farran, who had spent half a century studying early childhood education, said the findings forced her into a profound reconsideration of everything she had assumed about the subject. The so-called “fade-out effect,” in which any initial academic gains from pre-K programs typically evaporate by third grade, is well-established across multiple evaluations. And the cost of doing this poorly at scale is enormous. National estimates for quality universal pre-K programs run roughly $12,500 per child annually. For Kentucky, that is hundreds of millions of dollars annually for a program whose flagship examples in other states have produced disappointing or even harmful outcomes. Coleman has also championed a dramatic expansion of pre-K as an economic development strategy and workforce solution. Those projections deserve the same skepticism we would apply to any government program whose promised returns consistently fail to materialize. If Coleman wants to put universal pre-K at the center of her policy agenda, she owes Kentuckians a forthright accounting of the Tennessee and Head Start data — not a pivot around them. ## **An Agency That May Have Broken the Law — With the Education Board’s Blessing** If there is a single education issue that should concern every parent, legislator, and taxpayer in the commonwealth regardless of political persuasion, it is what the Kentucky Department of Education has done with student assessment — and what the Kentucky Board of Education apparently allowed to happen without so much as a public vote. For nearly two decades, every Kentucky high school junior took the ACT college entrance test. Whatever one thinks of standardized testing, the ACT provided something invaluable: an 18-year trend line of college-readiness data that could not be massaged by the state, could be compared across a number of other states, and revealed the unvarnished truth about where Kentucky students stood. What that trend line showed was uncomfortable. As [Bluegrass Institute research has documented extensively](https://www.bluegrassinstitute.org/testing-kentuckys-high-schoolers-dropping-act-shifting-to-sat-is-the-wrong-move/), ACT scores in reading, math, and science have declined since 2016–17\. The ACT is the sole long-term education trend line the state possesses — the one measure that has remained consistent through four different state-assessment regimes. Rather than confronting those declines, the Kentucky Department of Education scrapped the ACT and switched to the SAT. [This is not a harmless administrative choice.](https://www.bluegrassinstitute.org/kentuckys-switch-to-the-sat-violates-public-trust-it-may-also-violate-state-law/) It destroys the only continuous source of college-readiness data Kentucky has, eliminates the one state-funded metric that cannot be curved or inflated by the state, and violates both the structure and the requirements of state law. On this point, the Bluegrass Institute has been unambiguous about the legal problem. [KRS 158.6453 is explicit: the college entrance exam must assess English, reading, math, and science. The SAT simply doesn’t do that.](https://www.wkyufm.org/news/2026-01-02/lawmakers-could-be-asked-to-revisit-kentuckys-switch-to-sat-in-26-legislative-session?ref=bluegrassinstitute.org) The SAT has no separate English section and no separate science score. KDE’s response — that the law requires assessment of science but not a separate science section — is precisely the kind of bureaucratic hairsplitting that should concern a legislature that wrote the Kentucky Education Reform Act to ensure a stable, trustworthy assessment system. Worse, [the department’s switch to the SAT appears to have no public record of state board approval. KDE’s December 2025 briefing to the board on 2025 assessment results omitted](https://www.bluegrassinstitute.org/kentuckys-switch-to-the-sat-violates-public-trust-it-may-also-violate-state-law/) any discussion of the [legally mandated ACT’s results](https://www.bluegrassinstitute.org/evaluating-kentuckys-assessment-results-data-omissions-and-governance/). Those results showed serious performance declines that contradict the improving state assessment narrative the department presented to the board. The Board of Education, whose members are appointed by the governor, appears to have quietly allowed this to happen. That is a governance failure that rests with Governor Beshear’s appointees. Erasing the ACT’s trend line will potentially mask Kentucky’s educational performance for years. Coleman has been silent on the issue. Any gubernatorial candidate who genuinely believes in accountability for Kentucky schools should be asked: Did you know KDE was moving forward on the ACT to SAT change without board approval? Do you believe the switch, including both the adoption process and the test adopted, satisfies the requirements of state law? And if an agency under your administration decides it can ignore a statute rather than follow it, what would you do? ## **Opposing Help for Kids at No Cost to Taxpayers** This spring, the Kentucky General Assembly passed House Bill 1, opting the Commonwealth into the federal Education Freedom Tax Credit program. [The measure allows Kentucky students to benefit from scholarships funded through a federal tax credit — without costing the commonwealth a single dollar.](https://www.wkms.org/education/2026-03-16/beshear-vetoes-bill-on-educational-tax-credits?ref=bluegrassinstitute.org) The scholarships can be used for private school tuition, tutoring, books, internet access, and other educational expenses. They are available to public school students, not just those seeking private options. [Ahead of the Senate vote, Coleman publicly called HB 1 a “back door voucher bill” and urged Kentuckians to contact lawmakers to vote against it.](https://kentuckylantern.com/2026/02/27/ky-senate-sends-bill-to-opt-kentucky-into-federal-k-12-scholarship-program-to-beshear/?ref=bluegrassinstitute.org) She argued the bill would redirect federal tax revenue to private entities and benefit middle-to-upper-class families already attending private school. Those claims do not hold up. [Senate President Pro Tem David Givens noted that if Kentucky refused to opt in, Kentuckians could still claim the federal credit, but their donations would flow across state lines to support education elsewhere.](https://spectrumnews1.com/ky/louisville/news/2026/03/18/house-bill-one-law?ref=bluegrassinstitute.org) The practical effect of Coleman’s position, in other words, was not to protect Kentucky children — it was to ensure Kentucky children got none of the benefits while children in other states did. The governor vetoed the bill. The Republican supermajority overrode the veto. HB 1 is now law. Kentucky became the 28th state to opt in and the first to do so over a governor’s veto. Coleman's active public campaign against a zero-cost scholarship program is now part of her record as the administration's education point person, and the policy consequences of her preferred policy deserve serious scrutiny. ## **What a Coleman Administration Would Inherit** There is a deeper problem underlying all three of these issues, and it is one that [Bluegrass Institute has been documenting for years.](https://www.bluegrassinstitute.org/k-12-in-kentucky-a-summary-of-facts-and-trends/) Kentucky has substantially increased per-pupil spending in real terms over recent decades, and yet the state’s NAEP math and reading scores are lower today than they were a decade ago. The spending is going to bureaucracy, benefits, and pension obligations rather than into classrooms. The state’s own assessment history is a graveyard of programs (KIRIS, CATS, K-PREP, and now KSA, whose writing assessment has just been axed). Kentucky’s assessments are typically replaced before they produce the kind of reliable trend data that can be used to hold the state-run education system accountable. Into this environment, Coleman proposes to spend hundreds of millions more on a pre-K program with a highly troubled national track record, has been silent about an agency that may have violated state law to kill our only long-term, honest measurement of high school performance, and publicly fought a program that would give Kentucky families more education options at no cost to taxpayers. Jacqueline Coleman is running for governor on her education record. Kentuckians who care about educational accountability, transparency, and the wise use of public resources should examine that record closely. *Gary W. Houchens, Ph.D., is professor and director of the Educational Leadership Doctoral Program at Western Kentucky University. John Garen is the BB&T Professor Emeritus of Economics at the Gatton College of the University of Kentucky. Caleb O. Brown is CEO of the Bluegrass Institute.* ### Kentucky Supreme Court’s dangerous impeachment ruling subverts constitution URL: https://www.bluegrassinstitute.org/dangerous-impeachment-ruling/ Last updated: 2026-06-05T12:51:22.000Z The impeachment power is nearly 700 years old – Parliament first used it in the year 1376 – but it wasn’t until this month that the Kentucky Supreme Court decided it could block the people’s elected representatives from exercising this ancient constitutional power. In a 5-1 ruling, the justices ordered the state’s House of Representatives to halt its impeachment of Lexington trial judge Julie Muth Goodman on the theory that judges can only be removed from office for “an actual, indictable crime or an offense in office constituting the most reprehensible moral turpitude.” Because the representatives want to remove Judge Goodman based on what they consider wrongful rulings, instead of criminal activity, the justices ordered the impeachment stopped. But nothing in Kentucky’s Constitution – or any other constitution, for that matter – limits the impeachment power in this way. And by manufacturing this rule, the justices have put a dangerous obstacle in the way of the people’s power to control their own officials. The impeachment power is an invaluable tool for removing public officials, not just for “crimes” but for intolerable behavior in public office. Perhaps the clearest example is the impeachment of Massachusetts Chief Justice Peter Oliver in 1774, which was spearheaded by none other than John Adams. Adams’s complaint was that the British Parliament had announced that it would appoint, and pay, the colony’s judges directly from London—thus taking away those powers from the colony’s legislature. That risked making the courts into mere instruments of British power, which Adams thought intolerable. So, when Oliver said he would accept a paycheck from Parliament, Adams declared that impeachment was “essential to the preservation of the constitution in some cases that could be reached by no other power” and led his colleagues in demanding Oliver’s removal, and that of any other judge who accepted payment from the British government. Adams and other founders recognized that impeachment isn’t just for cases involving crimes—it’s part of the checks and balances that preserve freedom in our constitutional system. Impeachment, wrote Alexander Hamilton, is for “offenses which proceed from the misconduct of public \[officials\], or, in other words, from the abuse or violation of some public trust. \[These\] are of a nature which may with peculiar propriety be denominated *political*, as they relate chiefly to injuries done immediately to the society itself.” In other words, impeachment is not just about criminal or immoral conduct—it’s also a tool for ensuring against abuses of power that might not qualify as either criminal or immoral. Imagine, for example, that the chief justice were to move to Fiji and refuse to preside over cases or to communicate with anyone back home. That wouldn’t be criminal or immoral, but it would certainly be a violation of public trust. Could it really be the case that the legislature couldn’t remove him? To answer that question, the Kentucky justices pointed to a separate provision in the state constitution that establishes a commission to oversee the conduct of judges. This commission, the justices said, is the body that should decide such matters. But nothing in that provision says the commission is the only way to remove judges from office. And there’s no reason why both routes—removal by the commission *or* by the legislature—can’t coexist. The idea that (as the court put it) “the judge removal lane … is, under most circumstances, reserved solely for the Judiciary” is not only illogical but dangerous, as it would exempt courts from one of the most critical components of our constitutional separation of powers. It’s an ancient legal rule that nobody can be the judge of his or her own case. But the Kentucky Supreme Court’s ruling makes the state judiciary exactly that. That’s no exaggeration. Suppose the Legislature were now to try impeaching the Supreme Court justices for this absurd ruling. Would the judges try to declare their own impeachment invalid? To ask that question reveals the essential problem. The power to remove public officials from office is one of the most crucial of all constitutional guarantees. Subverting it risks depriving the people of power over their own government. The Kentucky justices also objected that the impeachment proceedings violated the constitutional principle of “due process of law” because Judge Goodman was, for technical reasons, unable to defend herself. But “due process of law” doesn’t apply to impeachments at all. It’s required only when a person is being deprived of “life, liberty, or property,” and public office isn’t any of those things. On the contrary, judicial office belongs to the people, not the judge, and a vigorous impeachment power is indispensable to ensuring it remains that way. Two centuries ago, James Madison said there was little reason to fear “judicial activism” because judges “can by various regulations be kept or reduced within the paths of duty, more especially with the aid of their amenability to the legislative tribunal in the form of impeachment.” But remove or constrain that power and who knows what the courts might do? --- *Timothy Sandefur is the Vice President for Legal Affairs at the Goldwater Institute’s Scharf-Norton Center for Constitutional Litigation.* *This piece originally appeared in* [*The Center Square*](https://www.thecentersquare.com/opinion/article%5F82f2f292-03ae-4d21-bd89-8c1356e35207.html?ref=bluegrassinstitute.org)*.* ### Kentucky General Assembly failed to deliver on housing affordability URL: https://www.bluegrassinstitute.org/kentucky-general-assembly-failed-to-deliver-on-housing-affordability/ Last updated: 2026-04-16T03:46:38.000Z Kentucky's next generation deserved better from this legislative session. For two years, Kentucky’s Housing Task Force built a record, heard from builders, [experts](https://www.bluegrassinstitute.org/author/mnolangray/?mc%5Fcid=3ce0620586&mc%5Feid=UNIQID), local officials, and families struggling to afford a place to live. Ultimately, the task force embraced [recommendations advanced by the Bluegrass Institute](https://www.bluegrassinstitute.org/a-menu-of-options-for-kentucky-housing-reform-2026-2/?mc%5Fcid=3ce0620586&mc%5Feid=UNIQID) last year. The data couldn't be clearer: Kentucky is not producing enough homes, affordability for working-class households has deteriorated, and the regulations that make it harder and more expensive to build are the primary culprit. **The fix to Kentucky’s housing crisis doesn't require a dollar of new spending. What it does require is the political will to get government out of the way to let markets function properly.** **Legislation that was one concurrence away from final passage would have altered the housing marketplace to make homes more affordable, enhance Kentuckians’ property rights, clear away needless regulatory barriers, and give developers greater confidence to undertake projects.** Kentucky lawmakers couldn’t get the job done, and that failure carries real consequences for young people across our commonwealth. **Every year without reform is another year that home prices climb faster than wages, another year that young families from Lexington or Bowling Green begin looking to other states to meet their housing needs. As a practical matter, zero reform means allowing other states to welcome into their communities tomorrow’s entrepreneurs, parents, and their children.** The Bluegrass Institute supported the [imperfect reform](https://apps.legislature.ky.gov/record/26rs/sb9.html?mc%5Fcid=3ce0620586&mc%5Feid=UNIQID&ref=bluegrassinstitute.org) on offer not because it was everything young people deserve, but because meaningful deregulatory reform — third-party plan review, permitting shot clocks, parking reform, vested rights protections, mixed-use flexibility — represents exactly the kind of zero-cost, market-enabling policy that actually works. Other states aren’t waiting to attract young people to their states. So far, Kentucky has just watched from the sidelines. The next generation of Kentucky homeowners, renters, entrepreneurs, parents, and workers will be paying attention. Next year’s lawmakers should, too. *Caleb O. Brown is CEO of the Bluegrass Institute.* ### City-Created Problems and Taxpayer-Funded Fixes URL: https://www.bluegrassinstitute.org/city-created-problems-taxpayer-funded-fixes/ Last updated: 2026-04-13T12:02:33.000Z Economic development departments are often celebrated as promoters of prosperity and local employment. Each year, local governments spend tens of billions of dollars on economic development incentives—tax abatements, fee waivers, and direct subsidies—intended to lure private investment. Cities across the nation tout their ability to entice marquee employers, generate buzz with ribbon-cuttings, and implement incentive programs designed to attract private capital. Even small-city councils establish these departments to signal support for economic growth and to boost city revenues. Yet beneath the surface of city branding, press releases, and fiscal sustainability strategies lies a more troubling reality: economic development departments, far from facilitating genuine development and demonstrating the appropriateness of their spending, entrench inefficiency, distort markets,[\[1\]](#fn1) and perpetuate the very obstacles they purport to overcome. **Incentives, Barriers, and the Illusion of Progress** Development incentives—tax rebates, fee waivers, and similar carrots—are meant to attract business investment. However, these incentives negate the tax and fee structures that cities themselves have painstakingly devised, often at great expense and through a protracted political process. For example, cities pay development and impact fee consultants tens of thousands of dollars to analyze and implement fee structures—purportedly based on the true cost of municipal services.[\[2\]](#fn2) Yet these very fees are then slashed or waived to lure preferred employers. The result is not a win-win, but a double loss for taxpayers. Carefully constructed revenue systems become arbitrary, and the cost of public services is obscured (taxpayer loss #1). A vicious cycle emerges: Cities rely on fees and taxes to fund infrastructure and services, only to compromise such revenue structures through selective abatements—thus necessitating higher fees and taxes (taxpayer loss #2).[\[3\]](#fn3) What’s often overlooked are the full effects of incentive-driven development. When cities allocate limited resources to court or subsidize select firms, they divert funds from core functions—such as road maintenance and public safety. This misallocation not only undermines neutrality but also erodes the foundational infrastructure that supports long-term economic vitality.[\[4\]](#fn4) Between 2017 and 2022, local governments reported a cumulative $93 billion in foregone revenue due to tax abatements. Over that period, waived revenue grew by 28% overall—and by 42% for school districts, which rely heavily on property taxes.[\[5\]](#fn5) According to a 2024 analysis by the Harvard Kennedy School, cities spend at least $30 billion annually on tax incentives—even though such incentives influence firm location decisions only 2% to 25% of the time.[\[6\]](#fn6) Cities themselves create economic barriers—through high fees, byzantine approval processes, and regulations—that make it arduous and expensive to start or expand a business. When such obstacles prove prohibitive, the economic development department creates subsidy programs and fast-track approval processes, selectively distributing relief to the fortunate few, and then claims credit for solving a problem that the city created.[\[7\]](#fn7) A similar dynamic plays out in housing policy. The city’s building and zoning regulations discourage development, leading to a shortage of housing. Rather than address the cause,[\[8\]](#fn8) cities establish housing departments that promote subsidized housing. Taxpayers pay for a lucky few (often, the winners of housing lotteries), yet housing shortages persist because the city has done nothing to address its contributions to the problem.[\[9\]](#fn9) **The Gatekeepers of Privilege** The very title “economic development” suggests a community-minded mission. But in practice, these departments function as gatekeepers of privilege. Decisions about which businesses receive support are often opaque—frequently shaped by personal connections, lobbying efforts, or perceived prestige.[\[10\]](#fn10) This lack of transparency undermines public trust and invites political patronage. The selective nature of support means that well-connected firms benefit disproportionately, while smaller or less visible businesses struggle to navigate the system. Moreover, the incentives themselves are rarely subject to rigorous analysis. Cities may tout job creation numbers or projected tax revenue, but these estimates often rely on optimistic assumptions and lack independent verification. A 2023 report by the Urban Institute found that only 12% of local incentive programs included any form of post-award performance auditing.[\[11\]](#fn11) **Reclaiming Urban Prosperity** The lifeblood of urban prosperity is not taxpayer subsidy, but private capital and innovation. Local governments are at their best when they focus on the essentials: maintaining public safety and ensuring reliable infrastructure. Cities should be neutral with regard to growth—neither artificially promoting nor stifling it. Certainly, they should never become financially reliant on growth such that they begin to favor growth at any cost. A city’s goal should be to secure a reputation as a welcoming, low-friction destination for business—a place where entrepreneurs can flourish with neither interference nor favoritism. Over time, the patchwork of incentives and interventions creates a brittle economic landscape—one dependent on continual taxpayer support rather than resilient private enterprise. Cities risk becoming less adaptive to economic shocks, as businesses conditioned to expect subsidies may be unable to weather downturns without them. The impotence and ineffectiveness of today’s economic development departments are not simply a matter of bureaucratic inertia or misaligned incentives. They are the logical product of a system that confuses activity with achievement, and intervention with improvement. By revisiting government fundamentals—eliminating unnecessary barriers, focusing on core services, and allowing private ingenuity to manifest—cities can reclaim their role as protectors of prosperity, rather than architects of their own dilemmas. --- --- 1. As it turns out, the distortion is minor, but only because the programs themselves are ineffective at influencing firm location decisions (see footnote #6) [↩︎](#fnref1) 2. ICF International. Development Impact Fee Study for the City of \[Example\]. ICF Reports, 2021\. [↩︎](#fnref2) 3. Lincoln Institute of Land Policy. The Hidden Cost of Economic Development Incentives. Policy Brief, 2020\. [↩︎](#fnref3) 4. Brookings Institution. The Case Against Economic Development Incentives. Brookings Metro, 2019\. [↩︎](#fnref4) 5. Good Jobs First, Tax Break Tracker and GASB 77 Aggregated Disclosures, 2017–2022\. This dataset aggregates local government disclosures of foregone revenue due to tax abatements, including school district impacts. Available at [https://www.goodjobsfirst.org/tax-break-tracker/](https://www.goodjobsfirst.org/tax-break-tracker/?ref=bluegrassinstitute.org) [↩︎](#fnref5) 6. Harvard Kennedy School. Evaluating the Effectiveness of Local Tax Incentives. Center for International Development, 2024\. [↩︎](#fnref6) 7. National League of Cities. Small Business Regulations and the Role of Local Government. NLC Research Brief, 2022\. [↩︎](#fnref7) 8. Although zoning regulations are largely under the control of cities, many cities (for example, those in California) have somewhat limited ability to streamline building codes, due to state mandates; however, they have done little to lobby for the relaxing or elimination of such restrictions. [↩︎](#fnref8) 9. Urban Land Institute. Zoning and Housing Affordability: Local Barriers and Policy Responses. ULI Technical Report, 2021\. [↩︎](#fnref9) 10. Center for Public Integrity. Economic Development Incentives and Political Influence. CPI Investigative Series, 2023\. [↩︎](#fnref10) 11. Urban Institute. Performance Auditing in Local Economic Development Programs. Urban Institute Brief, 2023\. [↩︎](#fnref11) --- *This piece originally appeared on* [*Mark Moses' Substack*](https://munifinanceguy.substack.com/)*.* ### Kentucky’s Supreme Court has ordered senators to abandon their oaths of office URL: https://www.bluegrassinstitute.org/supreme-court-senators-oaths-of-office/ Last updated: 2026-06-18T17:18:36.000Z I'll say it right up front: I'm not a lawyer. For that and other reasons, I was tempted to tread lightly on the impeachment trial awaiting Fayette Circuit Judge Julie Goodman in the Kentucky Senate. Here's the problem. The facts are crystal clear — and the Kentucky Supreme Court decision attempting to stop the trial makes this constitutional question even harder to ignore. By a [5-1 vote](https://urldefense.proofpoint.com/v2/url?u=https-3A%5F%5Fappellatepublic.kycourts.net%5Fapi%5Fapi%5Fv1%5Fpublicaccessdocuments%5F2639f7dc43e3583e47f7815f8e896f928062a9abfe46c35483fe84273bc00a71%5Fdownload&d=DwMFaQ&c=euGZstcaTDllvimEN8b7jXrwqOf-v5A%5FCdpgnVfiiMM&r=GLJInpmArbTUTf3si54pRtDisnnp81vKvCHMrDNuP0Y&m=7eaXglvPWnqBVsJ%5FZkUB3zq1xGw7YPjYq-orf0Sye2HtoEyfB-Qh0EUIhRjGHJuJ&s=uHQSOQBl0-WiRgKCu7UmsWldJkwDzN5CwbltbjSGSUM&e=&ref=bluegrassinstitute.org), the Court said Monday that the General Assembly lacked authority to impeach Judge Goodman, declaring the articles of impeachment void and ordering the legislature to cease its impeachment proceedings. The majority opinion, written by Chief Justice Debra Lambert, concluded that the legislature's impeachment power does not extend to conduct the Court considers within the exclusive domain of the judiciary. ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) The Kentucky Senate must proceed with the trial. That isn't a statement about Judge Goodman's conduct. It's a statement about Senators’ [oaths](https://urldefense.proofpoint.com/v2/url?u=https-3A%5F%5Fapps.legislature.ky.gov%5FKYConstitution%5F263-5F228.pdf&d=DwMFaQ&c=euGZstcaTDllvimEN8b7jXrwqOf-v5A%5FCdpgnVfiiMM&r=GLJInpmArbTUTf3si54pRtDisnnp81vKvCHMrDNuP0Y&m=7eaXglvPWnqBVsJ%5FZkUB3zq1xGw7YPjYq-orf0Sye2HtoEyfB-Qh0EUIhRjGHJuJ&s=id7xsj9YUeZUSnujHDh5c8%5FAdYiadU6XEdl6FYZ%5FFjg&e=&ref=bluegrassinstitute.org) to support the Kentucky Constitution, and not just the parts the Supreme Court found convenient to invoke. Consider what the Kentucky Constitution actually says. [Section 66](https://urldefense.proofpoint.com/v2/url?u=https-3A%5F%5Fapps.legislature.ky.gov%5FLaw%5FConstitution%5FConstitution%5FViewConstitution-3Frsn-3D72&d=DwMFaQ&c=euGZstcaTDllvimEN8b7jXrwqOf-v5A%5FCdpgnVfiiMM&r=GLJInpmArbTUTf3si54pRtDisnnp81vKvCHMrDNuP0Y&m=7eaXglvPWnqBVsJ%5FZkUB3zq1xGw7YPjYq-orf0Sye2HtoEyfB-Qh0EUIhRjGHJuJ&s=jnTfP-hk9zBRHiNwd3%5FOy0RNmFRP9tkrYDg%5FY-WUaDY&e=&ref=bluegrassinstitute.org) reads in its entirety: "The House of Representatives shall have the sole power of impeachment." [Section 67](https://urldefense.proofpoint.com/v2/url?u=https-3A%5F%5Fapps.legislature.ky.gov%5FLaw%5FConstitution%5FConstitution%5FViewConstitution-3Frsn-3D73&d=DwMFaQ&c=euGZstcaTDllvimEN8b7jXrwqOf-v5A%5FCdpgnVfiiMM&r=GLJInpmArbTUTf3si54pRtDisnnp81vKvCHMrDNuP0Y&m=7eaXglvPWnqBVsJ%5FZkUB3zq1xGw7YPjYq-orf0Sye2HtoEyfB-Qh0EUIhRjGHJuJ&s=T7WlXvskezPiMSSeWRnoRiUkZxegTzTVwf37E7P8wkc&e=&ref=bluegrassinstitute.org) reads: "All impeachments shall be tried by the Senate. When sitting for that purpose, the Senators shall be upon oath or affirmation. No person shall be convicted without the concurrence of two-thirds of the Senators present." And [Section 109](https://urldefense.proofpoint.com/v2/url?u=https-3A%5F%5Fapps.legislature.ky.gov%5FLaw%5FConstitution%5FConstitution%5FViewConstitution-3Frsn-3D119&d=DwMFaQ&c=euGZstcaTDllvimEN8b7jXrwqOf-v5A%5FCdpgnVfiiMM&r=GLJInpmArbTUTf3si54pRtDisnnp81vKvCHMrDNuP0Y&m=7eaXglvPWnqBVsJ%5FZkUB3zq1xGw7YPjYq-orf0Sye2HtoEyfB-Qh0EUIhRjGHJuJ&s=gDREnERSE9n6U-n%5FHzX7XM%5F%5FfsoEnS9vV71yNVDMdBc&e=&ref=bluegrassinstitute.org), which delegates the judicial power, says plainly: "The impeachment powers of the General Assembly shall remain inviolate." Kentucky courts have [defined “inviolate” to mean "unassailable"](https://urldefense.proofpoint.com/v2/url?u=https-3A%5F%5Flaw.justia.com%5Fcases%5Fkentucky%5Fsupreme-2Dcourt%5F1995%5F94-2Dsc-2D8-2Dtg-2D1.html&d=DwMFaQ&c=euGZstcaTDllvimEN8b7jXrwqOf-v5A%5FCdpgnVfiiMM&r=GLJInpmArbTUTf3si54pRtDisnnp81vKvCHMrDNuP0Y&m=7eaXglvPWnqBVsJ%5FZkUB3zq1xGw7YPjYq-orf0Sye2HtoEyfB-Qh0EUIhRjGHJuJ&s=QknPthjG2wPQNA2iLTtngSNmPngAnf%5FCA-Y6aZzKTkU&e=&ref=bluegrassinstitute.org) — a power that "cannot be annulled, obstructed, impaired, or restricted by legislative or judicial action." And yet, the Supreme Court has done exactly that: it has annulled, obstructed, and impaired the General Assembly's constitutionally assigned power to impeach. The majority's opinion that judicial *rulings* are beyond the legislature's impeachment authority is important and reasonable. On that point, even Judge Goodman’s more controversial opinions have not been impeded by the General Assembly. But that judgment about the legislature’s irrelevance to the rulings of judges has been leveled by a court *inserting itself* into a process the Constitution explicitly placed elsewhere. The five justices who joined the majority opinion seem not to have grappled seriously with what "inviolate" means when applied to another branch's power. Justice Shea Nickell did grapple with it — and he got it right. In his dissent, Nickell concluded that the Kentucky Constitution simply does not authorize courts to decide questions relative to impeachments. Impeachment is a legislative power. The General Assembly possesses the sole constitutional authority to initiate and maintain these proceedings. The supervisory writ the majority issued to commandeer and override those proceedings cannot, as Nickell wrote, "be reconciled with the command of Section 109 that 'The impeachment powers of the General Assembly shall remain inviolate.'" Nickell is right. The history of impeachment, both in Kentucky and at the federal level, supports the conclusion that these proceedings were designed from the founding as a check by the legislature on the other branches — not a power subject to judicial veto. The U.S. Supreme Court recognized as much in *Nixon v. United States* (1993), holding that Senate impeachment trials present a political question beyond judicial review. The reasoning matches Kentucky's own "sole power" and "inviolate" text. The majority quotes the founders about co-equal branches. Fine. But co-equality means each branch has exclusive authority in its own constitutional lane. The judiciary's lane is courts. The General Assembly's lane — when it comes to impeachment — is the legislature. A court ordering the legislature to dismiss a duly passed impeachment resolution is not the judiciary defending co-equality. It is the judiciary subordinating a co-equal branch. Every Kentucky Senator swore an oath to the Kentucky Constitution. That constitution assigns the Senate the duty to try all impeachments. It does not say "try all impeachments, unless a majority of the Supreme Court disagrees." Senators are not subordinates of the court on questions where the Constitution has given them, *and them alone*, the power to decide. Does Judge Goodman's official conduct breach the public trust? As the song says, maybe so and maybe not. Frankly, it’s not relevant to the most crucial question: “*Who gets to decide?*” The question of the acceptability of Judge Goodman’s conduct is currently before the Kentucky Senate, exactly where our commonwealth’s highest law placed it. The Senate must take up that question, conduct a fair trial, and render its judgment. Moving ahead with this trial is not defiance. It is fidelity to a constitution that means what it *very clearly* says. --- *This piece originally appeared in the* [*Lexington Herald-Leader*](https://www.kentucky.com/opinion/op-ed/article315330484.html?ref=bluegrassinstitute.org)*.* ### GOP-led states that cooperate with ICE surrender their power URL: https://www.bluegrassinstitute.org/cooperate-with-ice-surrender-their-power/ Last updated: 2026-04-01T13:19:48.000Z The federal government’s [dramatic expansion](https://stateline.org/2026/03/03/as-federal-immigration-enforcement-expands-local-police-struggle-with-cooperation/?ref=bluegrassinstitute.org) of [immigration-focused cooperative policing agreements](https://www.ice.gov/identify-and-arrest/287g?ref=bluegrassinstitute.org) with state and local authorities (about 1,500 agreements across 40 states) comes against the backdrop of the [historic unpopularity](https://www.foxnews.com/politics/fox-news-poll-disapproval-ice-rise?ref=bluegrassinstitute.org) of Immigration and Customs Enforcement. Worse, recent reporting indicates that American citizens are increasingly [facing federal assault charges](https://www.wsj.com/us-news/immigration-protests-noem-minneapolis-0b8bd496?ref=bluegrassinstitute.org) in cities with large immigration crackdowns despite video evidence that regularly contradicts the claims of federal agents. ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) It’s time for states to step back and reconsider their cooperation with the feds in this arena and all others when it comes to policing. The state-federal collaboration campaign undermines some of federalism’s most basic aspects and reduces state control over state police officers. **Yielding police powers to feds is a slippery slope** This comes as many right-leaning state legislatures are now considering requirements that their police departments [partner](https://tennesseelookout.com/2025/11/13/tennessee-partnerships-with-ice-multiply-as-feds-offer-14b-in-incentives-nationwide/?ref=bluegrassinstitute.org) with [federal agencies](https://journalistsresource.org/politics-and-government/287g-the-program-that-lets-state-and-local-police-perform-the-functions-of-federal-immigration-officers/?ref=bluegrassinstitute.org) – for instance, through so-called [287(g)](https://www.flgov.com/eog/news/press/2025/governor-ron-desantis-announces-additional-memoranda-agreement-between-florida-law?ref=bluegrassinstitute.org) or task force agreements – to coordinate law enforcement operations. The [killings of Alex Pretti and Renee Good](https://www.americanimmigrationcouncil.org/blog/ice-deaths-shootings-2026/?ref=bluegrassinstitute.org) in Minneapolis, along with other instances of questionable federal behavior ([defying court orders](https://www.politico.com/news/2026/01/30/ice-immigration-court-orders-00757894?ref=bluegrassinstitute.org), [warrantless searches](https://apnews.com/article/ice-arrests-warrants-minneapolis-trump-00d0ab0338e82341fd91b160758aeb2d?ref=bluegrassinstitute.org), etc.), should give states pause before signing a substantial piece of their sovereignty over to the federal government. Both Vice President [JD Vance](https://www.usatoday.com/news/politics/jd-vance/?ref=bluegrassinstitute.org) and White House advisor Stephen Miller recently [claimed that federal officers](https://www.fox9.com/news/trump-adviser-stephen-miller-tells-ice-have-federal-immunity-when-dealing-protesters?ref=bluegrassinstitute.org) have “[absolute immunity](https://www.newsweek.com/ice-shooting-updates-protests-erupt-nationwide-over-renee-goods-death-11327506?ref=bluegrassinstitute.org).” That’s not strictly true, but it’s close enough that state governments should take heed. **Unaccountable law enforcement poses dangers** Once state officers are imbued with federal authority, the actions they take in the name of that authority are effectively elevated beyond the reach of state law and policy. So state officers who go against their state training or instruction, even flagrantly and intentionally, will be beyond the reach of most state accountability protocols. For instance, state officers working on federal joint task forces have been held [immune from state criminal liability](https://cases.justia.com/federal/appellate-courts/ca5/15-51077/15-51077-2017-04-20.pdf?ts=1492731034&ref=bluegrassinstitute.org) and exempt from state policy requirements like [wearing body cameras](https://www.themarshallproject.org/2019/10/31/why-some-police-departments-are-leaving-federal-task-forces?ref=bluegrassinstitute.org). They may also be placed beyond the reach of state residents whose rights they abuse. Take the examples of [James King](https://ij.org/case/king-v-brownback/?ref=bluegrassinstitute.org) and [Hamdi Mohamud](https://ij.org/case/task-force-immunity-and-accountability/?ref=bluegrassinstitute.org). Under different circumstances and in different states (Michigan and Minnesota, respectively), both young people were abused by local police who’d been cross-deputized for federal task force work. And for that reason, both have spent years fighting for accountability – a fight that [continues in King’s case](https://www.supremecourt.gov/DocketPDF/25/25-729/387660/20251217094853914%5F1%20-%20Cert%20Petition.pdf?ref=bluegrassinstitute.org), which is pending on certiorari before the [Supreme Court](https://www.usatoday.com/news/politics/supreme-court/?ref=bluegrassinstitute.org), but a fight that has [sadly ended in Mohamud’s](https://ij.org/press-release/supreme-court-declines-to-hear-hamdi-mohamuds-case-against-st-paul-officer-who-framed-her/?ref=bluegrassinstitute.org), whose petition the nation's highest court denied in March. This is because federal officers, unlike their state colleagues, are [effectively above America’s highest law](https://ij.org/ll/are-federal-officials-above-the-law/?ref=bluegrassinstitute.org), the U.S. Constitution. While state and local officers can be held liable for constitutional violations, federal officers cannot. **Red states support states' rights ... until they don't** There is deep irony here for state governments led by Republicans who profess hand-over-heart devotion to federalism and the rule of law. By mandating that their officers submit to federal authority, state lawmakers give up much of their power to hold their own agents accountable to the law. It's also an expansion of federal power that these otherwise rock-ribbed conservatives would dependably decry in other contexts, from education to energy. Washington clamors for new power, regardless of which party holds the reins, and the authority that states surrender is not easily won back. For local and state police agencies, the challenge that these compelled partnerships present is more practical. When federal agents violate the rights of Americans, the local cops who have partnered with the feds may lack a strong incentive to act in accordance with state laws they‘ve sworn to uphold. In other words, a local police officer may find herself deciding whether she should protect and serve her local constituents or Uncle Sam. The bottom line is that after states enter into these agreements, it doesn’t matter that state tax dollars are paying officer salaries, issuing their badges or supplying their equipment. Once the federal government has a state signature on its federal contract, the state loses substantial control over its own police. Many state governments and officials have found this out too late. We both represent organizations that work to push back against federal overreach and reserve a broad range of authority to states. The framers of our Bill of Rights [understood](https://www.cambridge.org/core/books/good-governing/police-power-in-our-republics-first-century/A6F942AE17356DEE2C1175353C3E4681?ref=bluegrassinstitute.org) that policing is largely local, and keeping that authority where it belongs should be a consistent priority for anyone who cherishes liberty. So, before Republican-run states sign over sovereignty to purchase perceived safety, lawmakers should note that maybe-future-President Gavin Newsom is smiling with the thought of all the commonsense gun control or environmental mandates he can enforce through the partnerships forged today. --- *Caleb O. Brown is the CEO of the* [*Bluegrass Institute*](https://www.bluegrassinstitute.org/)*. Patrick Jaicomo is a senior attorney at the* [*Institute for Justice*](https://ij.org/?ref=bluegrassinstitute.org) *and one of the leaders of its Project on Immunity and Accountability. He represents Mr. King and Ms. Mohamud.* *This piece first appeared in* [*USA Today*](https://www.usatoday.com/story/opinion/2026/04/01/republican-state-ice-agreements-police-power/89247557007/?ref=bluegrassinstitute.org)*.* ### License plate readers are a privacy concern lacking oversight URL: https://www.bluegrassinstitute.org/license-plate-readers/ Last updated: 2026-04-22T18:57:34.000Z Whether government officials in Kentucky want to admit it or not, they are answering a fundamental question every time they fund and expand automatic license plate readers (ALPRs): Should the government be able to track your every move without a warrant? You probably won’t like the answer lawmakers have given so far. Cities across the country — including Louisville and Lexington — are blanketing streets with ALPRs, high-speed cameras that record every passing vehicle around the clock. Officials call them crime-fighting tools. That is sometimes true. But behind the promises of public safety lies a surveillance infrastructure with virtually no legal guardrails, one that has already been abused right here in Kentucky. ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) **An invasion of privacy** The numbers alone should give pause. There are hundreds of ALPRs across the commonwealth, and [Louisville alone operates close to 200](https://www.courier-journal.com/story/news/crime/2026/01/06/louisville-flock-camera-surveillance-across-jefferson-county-kentucky/87885361007/?ref=bluegrassinstitute.org). These cameras photograph every passing vehicle — not just those suspected of involvement in criminal activity — and use artificial intelligence to read the license plate and detect other distinctive features of vehicles like the color, make and even the presence of bumper stickers. That data is pooled into cloud-based databases accessible to law enforcement agencies across the nation. There are no federal laws requiring a warrant to query it. There are no meaningful limits on who can access it or why. We now know this is not a hypothetical risk. In February and March 2025, a DEA agent used a Louisville Metro Police detective’s login credentials to [run 150 immigration-related searches](https://www.courier-journal.com/story/news/crime/2025/12/30/lmpd-disciplines-officers-after-dea-searched-flock-camera-database/87963735007/?ref=bluegrassinstitute.org) of the city’s Flock camera system — without the detective’s knowledge. The searches listed “Immigration” and “ERO,” a reference to Immigration and Customs Enforcement's (ICE) Enforcement and Removal Operations, as the stated reasons. Three LMPD officers were disciplined. But the problem is not one rogue agent. The problem is a system with no guardrails that made the abuse possible in the first place. The same surveillance infrastructure used for those searches could just as easily track someone visiting a doctor, attending a protest or going to church. As the Electronic Frontier Foundation has documented, [aggregated ALPR data can reconstruct](https://www.eff.org/pages/what-alpr?ref=bluegrassinstitute.org) an intimate portrait of a person’s life — and chill constitutionally protected activity in the process. Privacy is not a loophole for criminals. It is a precondition for a free society. The government needs far more than administrative convenience to justify eroding it. The as-introduced version of [House Bill 58](https://apps.legislature.ky.gov/record/26rs/hb58.html?ref=bluegrassinstitute.org) from Rep. John Hodgson would cap data retention at 90 days unless tied to an active investigation, prohibit the sale of ALPR data and require agencies to publish written use policies. These would be substantial improvements over current law. **Putting up legal guardrails** And yet there are still substantial deficiencies. Kentucky law currently does not require a warrant before law enforcement — or federal agencies piggybacking on local systems — can query the data. It does not restrict which outside agencies may access Kentucky’s ALPR databases or under what legal authority. The Louisville incident happened precisely because none of those rules existed. A published departmental policy is not a substitute for statewide law with real consequences. The current version of Rep. Hodgson’s bill also creates a variety of troubling carveouts for private companies that do not protect privacy. A [similar bill passed](https://apps.legislature.ky.gov/record/25rs/hb20.html?ref=bluegrassinstitute.org) the House 90 –1 last year. The Senate did not move it. That inaction looks far worse today, in light of what we now know happened in Louisville. The Kentucky Senate has possession of the bill now. A warrant requirement for historical data queries and strict, enforceable limits on access to locally gathered data would substantially improve the bill’s treatment of individual rights. Used with proper oversight, ALPRs can help solve crimes and find missing people. But Kentuckians should not have to choose between public safety and the right to move freely without being tracked, catalogued and made available for inspection by any agency that asks. The General Assembly has both the power and the obligation to make sure they don’t. --- *Caleb O. Brown is CEO of the Bluegrass Institute.* [*Alasdair Whitney*](https://ij.org/staff/alasdair-whitney/?ref=bluegrassinstitute.org) *is legislative counsel at the* [*Institute for Justice.*](https://ij.org/?ref=bluegrassinstitute.org) *This piece originally appeared in the* [*Louisville Courier Journal*](https://www.courier-journal.com/story/opinion/contributors/2026/03/31/kentucky-license-plate-camera-alpr-lmpd-privacy-house-bill/89300077007/?ref=bluegrassinstitute.org)*.* ### Kentucky’s Tax Reforms Continue Economic Progress URL: https://www.bluegrassinstitute.org/tax-reforms-continue-economic-progress/ Last updated: 2026-03-30T14:08:37.000Z Kentucky’s move to [replace](https://apps.legislature.ky.gov/record/18rs/hb366.html?ref=bluegrassinstitute.org) its progressive income tax with a flat five percent rate in 2018 led the rising flat-tax revolution and spurred serious economic growth. That growth [triggered](https://www.kychamber.com/sites/default/files/pdfs/A%20Guide%20to%20House%20Bill%208%5F0.pdf?ref=bluegrassinstitute.org) further tax cuts that have reduced the state’s income tax to four percent, with another drop to 3.5 percent scheduled [next year](https://www.baldwincpas.com/insights/kentucky-tax-overhaul-guide-to-2025-26-tax-changes?ref=bluegrassinstitute.org)—all while raising the Budget Reserve Trust Fund to a [record $3.76 billion](https://www.klc.org/News/12972/state-ends-fiscal-year-with-131-million-surplus?ref=bluegrassinstitute.org). But this is no time for state policymakers to rest on recent laurels. Kentucky must now keep up with the Joneses. Neighboring states are aggressively reshaping their tax codes to attract businesses and workers. Kentucky will need to do the same if it wants to remain competitive. Neighboring Tennessee [levies no state income tax](https://taxfoundation.org/location/tennessee/?ref=bluegrassinstitute.org). Indiana will charge just [2.95 percent in 2026](https://states.aarp.org/indiana/state-taxes-guide?ref=bluegrassinstitute.org). And Ohio adopted a flat rate of [2.75 percent earlier this year](https://ohiosenate.gov/members/stephen-a-huffman/news/senate-approves-final-budget-reducing-tax-burden-by-1-billion-with-flat-tax-and-substantial-property-tax-relief?ref=bluegrassinstitute.org). Kentucky’s 3.5 percent rate in 2026 will still be higher than several regional competitors. And competition for employers and employees in the 21st century economy is no longer regional, as workers and businesses move freely around the country looking to boost their bottom lines. That means good tax policy matters now more than ever. States reduced personal income taxes [56 times](https://taxfoundation.org/research/all/state/2024-state-tax-changes/?ref=bluegrassinstitute.org) between 2019 and 2024\. And between 2020 and 2023, [high-tax states lost 2.8 million net residents](https://www.heritage.org/taxes/report/if-you-tax-them-they-will-run-millions-americans-flee-california-and-new-york?ref=bluegrassinstitute.org) to low-tax states, with remote workers, retirees, young professionals, and households across income levels seeking more financial flexibility. But personal migration tells only part of the story. Companies looking to build manufacturing facilities, data centers, or AI research hubs, evaluate whether they can attract and retain skilled workers. States with lower personal income taxes offer a dual advantage: reduced labor costs for employers and higher take-home pay for workers. These advantages increase productivity, spurring more investment, more jobs, and faster wage growth. States often rely on aggressive tax incentive packages to attract major manufacturing and technology projects, but these short-term deals are no substitute for structural tax policies that benefit all workers and businesses. Kentucky can dangle project-specific incentives for some would-be employers, but higher personal income tax rates keep the Commonwealth at a regional disadvantage when companies evaluate long-term operating environments. And smaller firms never even see special tax incentives, leaving them at a perpetual disadvantage despite the valuable role they play in economic growth and local labor markets. To keep pace, Kentucky should continue lowering its tax rates for everyone, not just large firms. And lower tax rates are more affordable than some might think. The Buckeye Institute used its dynamic scoring model—STELA (state tax and economic long-run analysis model) to analyze two scenarios of Kentucky tax reform: the scheduled tax rate reduction to 3.5 percent in 2026, and a hypothetical cut to three percent in 2027\. The 2026 tax cut will trigger immediate economic effects, with a projected $510 million increase in Kentucky’s GDP in the first year, along with a $260 million rise in private investment and 2,000 new jobs. By 2034, the STELA estimates sustained annual GDP gains of $1.76 billion, an additional $750 million in investment, and another 6,000 new jobs. But Kentucky can afford to move even faster. A reduction to three percent in 2027 would raise the GDP by $810 million and private investment by $370 million. By 2034, once fully phased in, the STELA projects annual GDP gains of $1.99 billion, $850 million in new private investment, and 7,000 jobs—all while generating new tax revenue of roughly 38 percent of the initial revenue loss, reducing the net impact to $1.55 billion by 2034. Kentucky has a responsible fiscal framework for eliminating its income tax. And its record Budget Reserve Trust Fund, current economic conditions, and quantified dynamic modeling justify policymakers hitting the next revenue trigger to make the state more competitive sooner rather than later. --- *Rea. S Hederman Jr is vice president of policy and Sai C. Martha is an economic research analyst at* [*The Buckeye Institute*](https://www.buckeyeinstitute.org/?ref=bluegrassinstitute.org)*.* ### The DOJ Wants To Drop Charges Against 2 Cops Who Played a Crucial Role in Breonna Taylor's Death URL: https://www.bluegrassinstitute.org/doj-breonna-taylor/ Last updated: 2026-03-28T12:08:35.000Z Louisville, Kentucky, Detective Joshua Jaynes lied when he applied for the March 2020 search warrant that resulted in [Breonna Taylor's death](https://reason.com/2025/09/02/botched-drug-raids-show-how-prohibition-invites-senseless-violence/?ref=bluegrassinstitute.org). Then he lied about his lies. Sgt. Kyle Meany, the supervisor who approved the warrant application, also tried to cover up its shortcomings. According to an August 2022 [federal indictment](https://web.archive.org/web/20220804165257/https://www.justice.gov/opa/press-release/file/1524111/download), both officers knew that police did not have probable cause to search Taylor's apartment. ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) Based on those allegations, the indictment [charged](https://reason.com/2022/08/04/four-cops-implicated-in-breonna-taylors-death-now-face-federal-charges/?ref=bluegrassinstitute.org) Jaynes and Meany with violating [18 USC 242](https://www.law.cornell.edu/uscode/text/18/242?ref=bluegrassinstitute.org) by "willfully" depriving Taylor of her Fourth Amendment rights under color of law. It also charged them with conspiring to [falsify](https://www.law.cornell.edu/uscode/text/18/1519?ref=bluegrassinstitute.org) a document and [mislead](https://www.law.cornell.edu/uscode/text/18/1512?ref=bluegrassinstitute.org) federal investigators. But according to the Justice Department, which [asked](https://www.washingtonpost.com/politics/2026/03/20/breonna-taylor-justice-department-drop-charges/?ref=bluegrassinstitute.org) U.S. District Judge Charles R. Simpson III to dismiss those charges on Friday "in the interest of justice," the indictment exemplified the Biden administration's "inappropriate, weaponized federal overreach." Although that judgment is hard to fathom as a matter of law, it is consistent with President Donald Trump's [blasé attitude](https://reason.com/2024/01/24/accused-of-dictatorial-ambitions-trump-doubles-down-on-authoritarianism/?ref=bluegrassinstitute.org) toward police abuses, which he sees as an acceptable cost of "STRONG & EFFECTIVE CRIME PREVENTION." It is therefore not surprising that Trump's Justice Department [seems to view](https://www.reuters.com/world/us/us-abandons-police-reform-accords-sought-over-deaths-george-floyd-breonna-taylor-2025-05-21/?ref=bluegrassinstitute.org) federal remedies for police abuses as unseemly meddling with local law enforcement. But abandoning those remedies undermines civil liberties by signaling that the Justice Department is no longer interested in pursuing charges against police officers who willfully violate Americans' constitutional rights. In her [motion](https://storage.courtlistener.com/recap/gov.uscourts.kywd.126795/gov.uscourts.kywd.126795.77.0.pdf?ref=bluegrassinstitute.org) to dismiss the charges against Jaynes and Meany, Harmeet Dhillon, the assistant attorney general in charge of the Justice Department's Civil Rights Division, does not say the defendants are not guilty of knowingly violating Taylor's Fourth Amendment rights. Nor does Dhillon say they told the truth when they were asked about Jaynes' warrant affidavit, which according to the 2022 indictment "contained false and misleading statements, omitted material information, relied on stale information, and was not supported by probable cause." Dhillon's silence on those crucial points suggests she simply does not view the officers' conduct as sufficiently serious to warrant federal charges, which is alarming given the facts of the case. Jaynes' [warrant affidavit](https://reason.com/wp-content/uploads/2020/06/Breonna-Taylor-search-warrants.pdf?ref=bluegrassinstitute.org), which he submitted to Jefferson County Circuit Judge Mary Shaw on March 12, 2020, implied that Taylor, a 26-year-old EMT and aspiring nurse, was involved in drug trafficking by her ex-boyfriend, Jamarcus Glover. But that allegation was based almost entirely on guilt by association: Taylor was still in touch with Glover, who no longer lived with her but continued to receive packages at her apartment after he moved out. What was in those packages? According to Glover, who [said](https://reason.com/2025/06/09/denver-case-highlights-the-potentially-deadly-hazards-of-police-raids-based-on-secondhand-information/?ref=bluegrassinstitute.org) he worried that the packages would be stolen if he had them delivered at his new address, they contained shoes and clothing he had ordered from Amazon. That is consistent with what Jaynes [told](https://reason.com/2020/10/09/a-month-before-louisville-drug-warriors-killed-breonna-taylor-they-knew-the-suspicious-packages-she-supposedly-was-receiving-came-from-amazon/?ref=bluegrassinstitute.org) internal investigators after Taylor's death. In late January or early February 2020, according to Jaynes, Sgt. Jonathan Mattingly, one of the officers who would later execute the search warrant, "nonchalantly" told him "your guy \[Glover\] just gets Amazon or mail packages there." Jaynes added: "I remember 'Amazon' resonating in my head. I just remember the word *Amazon*." According to the 2022 indictment, that conversation never happened. After the shooting, it says, Jaynes called Mattingly to "try to get \[him\] to say" he had "previously told" Jaynes that Glover "had received packages at Taylor's apartment." Per the indictment, Mattingly actually had told Jaynes "he had no information showing that \[Glover\] received packages at Taylor's apartment," and Mattingly reiterated that point during the phone call. But even if Mattingly had said something about Amazon shipments prior to the raid, it would not have indicated there was anything suspicious about the packages. After the raid, Tony Gooden, a postal inspector in Louisville, [told](https://www.wdrb.com/in-depth/louisville-postal-inspector-no-packages-of-interest-at-slain-emt-breonna-taylor-s-home/article%5Ff25bbc06-96e4-11ea-9371-97b341bd2866.html?ref=bluegrassinstitute.org) a local TV station that Louisville police had never consulted with his office about the packages Glover received at Taylor's apartment. Gooden added that a different law enforcement agency, which he declined to identify, had asked about the packages in January 2020, when his office concluded "there's no packages of interest going there." None of that was reflected in Jaynes' affidavit. Instead, Jaynes falsely claimed he had "verified through a US Postal Inspector that Jamarcus Glover has been receiving packages" at Taylor's apartment. He added that "affiant knows through training and experience that it is not uncommon for drug traffickers to receive mail packages at different locations to avoid detection from law enforcement." Based on his "training and experience," he said, he "believe\[d\]" that Glover "may be keeping narcotics and/or proceeds from the sale of narcotics" at Taylor's apartment. According to a [superseding indictment](https://storage.courtlistener.com/recap/gov.uscourts.kywd.126795/gov.uscourts.kywd.126795.52.0%5F1.pdf?ref=bluegrassinstitute.org) filed in October 2024, Jaynes' affidavit also "falsely claimed" that he had "observed" Glover's car making "frequent trips" between Taylor's apartment and the properties he allegedly used for drug trafficking. "In fact," the indictment says, Jaynes and Meany "had only seen \[Glover's\] car at Taylor's home on one occasion, on January 16, 2020, nearly two months before they submitted the warrant affidavit to a judge." Glover later [insisted](https://reason.com/2020/09/01/kentucky-authorities-offered-leniency-to-breonna-taylors-ex-if-he-would-implicate-her-in-drug-crimes/?ref=bluegrassinstitute.org) that Taylor was not involved in his drug dealing. And contrary to Jaynes' avowed expectation, the search of her apartment [did not find](https://reason.com/2025/06/09/denver-case-highlights-the-potentially-deadly-hazards-of-police-raids-based-on-secondhand-information/?ref=bluegrassinstitute.org) drugs or drug money. In December 2020, interim Louisville Police Chief Yvette Gentry [fired](https://reason.com/2020/12/30/2-more-cops-involved-in-breonna-taylors-death-receive-termination-letters/?ref=bluegrassinstitute.org) Jaynes, saying he "lied when he swore 'verified through a US Postal Inspector.'" Jaynes "did not have contact with a US Postal Inspector," she noted. "Having an independent, third party verify information is powerful and compelling \[evidence\]. The inclusion of this in the affidavit as a direct verification was deceptive." Meanwhile, according to the 2022 indictment, Jaynes had lied about the actual source of this information in interviews with local and federal investigators, inventing a fictitious conversation with Mattingly. In "an official Investigative Letter," on May 1, 2020, Jaynes and Detective Kelly Goodlett likewise claimed he had "verified through" Mattingly, "who contacted the postal service, that \[Glover\] had been receiving packages" at Taylor's apartment. The letter also included "the misleading claim that a detective 'was able to verify through CLEAR, a law enforcement database, that as of February 20, 2020, \[Glover\] used" Taylor's apartment "as his residence." The indictment says Jaynes and Goodlett "both knew at the time that this statement was misleading" because Glover "did not live there" as of February. When Meany signed off on Jaynes' warrant application, according to the indictment, he knew "the affidavit contained false and misleading statements, omitted material information, relied on stale information, and was not supported by probable cause." Meany later "falsely told" an FBI agent that "a paragraph requesting authority to make a no-knock entry at Taylor's home was included" because the Louisville SWAT unit had requested it, which was not true. The request for no-knock authorization was itself [faulty](https://reason.com/2020/06/21/was-the-search-warrant-for-the-drug-raid-that-killed-breonna-taylor-illegal/?ref=bluegrassinstitute.org) because Jaynes did not supply the sort of evidence that the Supreme Court has said is necessary to dispense with the usual requirement that police knock and announce themselves before entering someone's home. In 1997, the Court unanimously [held](https://supreme.justia.com/cases/federal/us/520/385/case.pdf?ref=bluegrassinstitute.org) that the Fourth Amendment does not allow a "blanket exception" to that rule for drug investigations. Rather, it said, police must "have a reasonable suspicion that knocking and announcing their presence, under the particular circumstances, would be dangerous or futile, or that it would inhibit the effective investigation of the crime by, for example, allowing the destruction of evidence." While Jaynes made that general assertion in his affidavit, he did not include any evidence to back it up that was specific to Taylor. Goodlett, who was [accused](https://reason.com/2022/08/04/four-cops-implicated-in-breonna-taylors-death-now-face-federal-charges/?ref=bluegrassinstitute.org) of "conspiring with Jaynes to falsify the search warrant for Taylor's home and to cover up their actions afterward," [pleaded guilty](https://www.cnn.com/2022/08/23/us/breonna-taylor-ex-officer-kelly-goodlett-guilty-plea/index.html?ref=bluegrassinstitute.org) a few weeks after she was charged. She said Jaynes had never verified that Glover was receiving "suspicious packages" at Taylor's apartment. Violations of 18 USC 242 are ordinarily misdemeanors. But Jaynes and Meany were originally charged with felonies under that statute based on the argument that their violation of Taylor's Fourth Amendment rights "involved the use of a dangerous weapon" and resulted in her death. Simpson [rejected](https://reason.com/2024/08/26/why-a-federal-judge-dismissed-2-felony-charges-stemming-from-the-drug-raid-that-killed-breonna-taylor/?ref=bluegrassinstitute.org) those enhancements in August 2024. The fact that Jaynes and Meany knew the officers who executed the search warrant would be armed, Simpson said, was not enough to establish "use of a dangerous weapon." And the deadly outcome of the raid, he added, did not stem directly from the defective warrant. Rather, it was "the late-night, surprise manner of entry" that precipitated the gunfire that killed Taylor. Even if the warrant had been valid, Simpson reasoned, the outcome would have been the same. Simpson reiterated that point in August 2025 after federal prosecutors tried to strengthen their argument that Jaynes and Meany were legally responsible for Taylor's death. Although he was "seriously troubled by the claimed falsehoods," he [wrote](https://storage.courtlistener.com/recap/gov.uscourts.kywd.126797/gov.uscourts.kywd.126797.69.0.pdf?ref=bluegrassinstitute.org), prosecutors "cannot attribute Taylor's death to the lack of a warrant supported by probable cause." Rather, he said, that outcome was the result of "legal, lethal and tragic crossfire that was not initiated by police." That summary glossed over the recklessness of the officers who executed the warrant that Jaynes obtained. Despite their no-knock warrant, Mattingly and the two other plainclothes officers who approached Taylor's apartment around 12:40 a.m. on March 13, 2020, banged on the door before smashing it open with a battering ram. They said they also announced themselves, but that claim was [contradicted](https://www.nytimes.com/2020/08/30/us/breonna-taylor-police-killing.htm?ref=bluegrassinstitute.org) by nearly all of Taylor's neighbors. Taylor's boyfriend, Kenneth Walker, was in the bedroom with her at the time. He later said he heard no announcement and had no idea that the men breaking into the apartment were police officers. Alarmed by the banging and the ensuing crash, he grabbed a handgun and fired a single shot at the intruders, striking Mattingly in the thigh. The three officers [responded](https://reason.com/2020/09/24/the-legal-response-to-breonna-taylors-death-shows-how-drug-prohibition-transforms-murder-into-self-defense/?ref=bluegrassinstitute.org) with a hail of 32 bullets, including six fired by Mattingly, 16 fired by Detective Myles Cosgrove, and 10 fired by Detective Brett Hankison, who was standing outside the apartment. Hankison fired blindly through a bedroom window and a sliding glass door, both of which were covered by blinds and curtains. Six of the rounds struck Taylor, who was unarmed and standing near Walker in a dark hallway. Investigators later concluded that Cosgrove had fired the bullet that killed Taylor. Walker called his mother and 911 about the break-in that night. "Somebody kicked in the door and shot my girlfriend," he [told](https://www.pbs.org/newshour/nation/breonna-taylor-grand-jury-recording-slated-to-be-released?ref=bluegrassinstitute.org) a police dispatcher. He initially was charged with attempted murder of a police officer, but local prosecutors [dropped](https://www.nytimes.com/2020/05/22/us/Breonna-Taylor-Kenneth-Walker.html?ref=bluegrassinstitute.org) that charge two months later, implicitly conceding that he had a strong self-defense claim. An investigation by Kentucky Attorney General Daniel Cameron [concluded](https://www.nytimes.com/video/us/politics/100000007356820/kentucky-attorney-general-breonna-taylor-grand-jury-decision.html?ref=bluegrassinstitute.org) that Mattingly and Cosgrove also had fired in self-defense, a judgment that reflects the dangerously chaotic situation the officers created by breaking into the apartment in the middle of the night. The only officer to face state criminal charges was Hankison, who was [fired](https://reason.com/2020/12/30/2-more-cops-involved-in-breonna-taylors-death-receive-termination-letters/?ref=bluegrassinstitute.org) three months after the raid because of his reckless shooting. He was charged with three counts of wanton endangerment that September, based on rounds that entered a neighboring apartment, but [acquitted](https://reason.com/2022/03/04/a-jury-concludes-that-blindly-firing-10-rounds-into-breonna-taylors-apartment-was-not-wanton-endangerment/?ref=bluegrassinstitute.org) by a state jury in March 2022. Taylor's family, which sued the city of Louisville the month after the raid, announced a $12 million [settlement](https://reason.com/2020/09/15/louisville-will-pay-12-million-to-settle-lawsuit-by-breonna-taylors-family/?ref=bluegrassinstitute.org) in September 2020\. Three months later, on the same day Gentry dismissed Jaynes, she also [canned Cosgrove](https://reason.com/2020/12/30/2-more-cops-involved-in-breonna-taylors-death-receive-termination-letters/?ref=bluegrassinstitute.org), saying he had fired "in three distinctly different directions," which indicated he "did not identify a target" and instead "fired in a manner consistent with suppressive fire, which is in direct contradiction to our training, values and policy." After his state acquittal, Hankison was charged under 18 USC 242 based on his reckless use of deadly force. His federal prosecution ended with a [mistrial](https://www.courier-journal.com/story/news/crime/2023/11/16/ex-louisville-cop-brett-hankisons-federal-trial-ends-in-mistrial/71608553007/?ref=bluegrassinstitute.org) in November 2023 because the jury could not reach a verdict. A year later, another federal jury [convicted](https://reason.com/2024/11/04/cop-who-fired-blindly-into-breonna-taylors-home-is-convicted-of-violating-her-constitutional-rights/?ref=bluegrassinstitute.org) Hankison of willfully violating Taylor's Fourth Amendment rights. Because the charge "involved the use of a dangerous weapon and an attempt to kill," he faced a maximum sentence of life. In July 2025, he was [sentenced](https://reason.com/2025/07/22/5-years-after-breonna-taylor-was-killed-1-officer-gets-33-months/?ref=bluegrassinstitute.org) to 33 months in federal prison. As *Reason*'s Autumn Billings [noted](https://reason.com/2025/07/22/5-years-after-breonna-taylor-was-killed-1-officer-gets-33-months/?ref=bluegrassinstitute.org), that sentence was much shorter than the one recommended by the U.S. Probation Office, which [suggested](https://www.usatoday.com/story/news/nation/2025/07/17/brett-hankison-sentence-breonna-taylor-raid/85255750007/?ref=bluegrassinstitute.org) a range of 11 to 14 years. But Hankison's punishment was much more severe than the penalty favored by the Justice Department, which "asked U.S. District Judge Rebecca Grady Jennings to sentence Hankison to just one day in prison and three years of supervised release." In addition to Hankison's federal mistrial, Dhillon [noted](https://www.nytimes.com/2025/07/17/us/politics/justice-department-brett-hankison-sentence-breonna-taylor.html?ref=bluegrassinstitute.org) his state acquittal. But the state case involved different elements, since it did not entail willful violation of constitutional rights. It also involved different victims: Taylor's neighbors, as opposed to Taylor herself. One wonders how Dhillon would have handled Hankison's case if he had not been convicted before she took office. Her decision to drop the charges against Jaynes and Meany provides a clue. "Neither of these officers was present during the shooting, and a district court has already repeatedly dismissed the most serious charges as completely unsupportable," a Justice Department spokesperson [noted](https://www.washingtonpost.com/politics/2026/03/20/breonna-taylor-justice-department-drop-charges/?ref=bluegrassinstitute.org) on Friday. But those observations hardly justify giving a pass to the detective whose dishonesty played a crucial role in Taylor's senseless death. Simpson was right that Taylor's death did not flow inexorably from the warrant that Jaynes obtained. It is nevertheless true that Taylor would not have died in a hail of gunfire but for Jaynes' fraudulent and misleading affidavit, which Meany approved. That reality underlines the potentially grave consequences of letting police officers [make shit up](https://reason.com/2025/09/02/botched-drug-raids-show-how-prohibition-invites-senseless-violence/?ref=bluegrassinstitute.org) to manufacture probable cause—a danger that does not seem to trouble the main Justice Department official charged with protecting Americans' civil rights. --- *Jacob Sullum is a senior editor at* [*Reason*](https://reason.com/?ref=bluegrassinstitute.org)*. He is the author, most recently, of* [*Beyond Control: Drug Prohibition, Gun Regulation, and the Search for Sensible Alternatives*](https://www.beyondcontrolbook.net/?ref=bluegrassinstitute.org) *(Prometheus Books).* *This piece first appeared in* [*Reason*](https://reason.com/2026/03/23/the-doj-drops-charges-against-2-cops-who-played-a-crucial-role-in-breonna-taylors-death/?ref=bluegrassinstitute.org)*.* ### Kentucky’s path to prosperity: three reforms to boost economic freedom URL: https://www.bluegrassinstitute.org/three-reforms-to-boost-economic-freedom/ Last updated: 2026-03-26T17:51:36.000Z A new report by the Fraser Institute makes clear what most Kentuckians already know: the commonwealth remains mired in the bottom half of American states when it comes to economic freedom. Kentucky’s neighbors, meanwhile, have climbed. Indiana and Tennessee are in the top tier of states in terms of permitting the broadest range of economic choices for their residents. The costs to average Kentuckians are clear. States in the top quartile of economic freedom see population growth nearly 18 times faster than the least-free states. Their statewide personal income grows nine times faster. Their residents [experience](https://www.fraserinstitute.org/sites/default/files/2025-10/the-liberators-us-states-that-increased-their-economic-freedom-in-the-21st-century.pdf?ref=bluegrassinstitute.org#page=9) less poverty, less food insecurity, and less homelessness. If Kentucky wants to stop losing residents and businesses to more free states, lawmakers must take the Fraser Institute’s findings seriously. The solutions are straightforward. **Government spending is KY’s weakness** Kentucky’s most significant drag on economic freedom is government spending, particularly transfers and subsidies as a percentage of income, which are the fifth highest in the country. Kentucky is the[ second-most](https://beattyvilleenterprise.com/stories/kentucky-is-2025s-2nd-most-federally-dependent-state-wallethub-study,9544?ref=bluegrassinstitute.org) federally dependent state in the nation. For every dollar Kentuckians pay in federal taxes, they receive $3.35 in federal funding — a ratio that sounds advantageous but actually reflects an economy dependent on federal largesse. Over 38 percent of Kentucky’s state and local government revenues come from federal transfers — nearly 12 percentage points higher than the national average. Most of this flows through Medicaid, which now covers roughly one in three Kentucky residents following the Affordable Care Act expansion. While ensuring healthcare access matters, this level of dependency crowds out private-sector growth and makes Kentucky vulnerable to federal policy changes. The path forward isn’t to abandon those in need but to grow the private economy faster. [Workforce development](https://www.lex18.com/news/covering-kentucky/kentucky-legislators-want-to-build-the-states-first-vocational-prison-campus-to-help-inmates-gain-job-skills?ref=bluegrassinstitute.org) initiatives that move able-bodied adults from dependency to employment, [occupational licensing reform](https://www.bluegrassinstitute.org/boost-kentuckys-labor-market-reform-occupational-licensing/) that removes barriers to work, and welfare-to-work programs with appropriate support services can reduce transfer dependency while improving lives. **Taxes: Progress Made, More to Do** Kentucky has made meaningful progress on taxes. The top marginal personal income tax rate has fallen from 6 percent in 2018 to [4 percent today.](https://www.bluegrassinstitute.org/continuing-ky-tax-reform-efforts/) However, more could be done. The state’s payroll and income tax revenue remains high relative to state resident income. It was the 11th highest in the nation as of 2023, the latest year for which we have comparable data. Hopefully, the state’s lower income tax rates will improve this. Kentucky also remains one of only six states levying an inheritance tax. While this “death tax” generates relatively little revenue, it ranks Kentucky dead last and drives wealth and business succession planning across state lines. Repealing the inheritance tax would immediately improve Kentucky’s competitive position. **Labor market freedom** Labor market freedom represents Kentucky’s strongest category, thanks largely to the right-to-work law enacted in 2017\. Kentucky now ranks first among states for right-to-work status, first for maintaining the federal minimum wage floor without state additions, and fifth for workers’ compensation costs. These policies give Kentucky a genuine competitive advantage in attracting manufacturing and logistics operations. Yet opportunity remains. Occupational licensing reform — reducing unnecessary barriers to work in dozens of professions — would improve labor market freedom while expanding opportunity for Kentuckians. Kentucky can improve its labor freedom by reducing credential requirements that protect incumbent workers rather than public safety. More broadly, the state needs to check the growing problem of regulatory accumulation. In a forthcoming report for the [Bluegrass Institute](https://www.bluegrassinstitute.org/), Hoover Institution Fellow Patrick McLaughlin finds that restrictive language in Kentucky’s regulatory code — words like “shall” and “must” — has grown twice as fast as in the median state. Drawing on lessons from others like Idaho, Virginia, and British Columbia, he notes that regulatory restraint can unleash significant new economic growth. **The stakes are clear** Nearly 1,000 peer-reviewed [studies](https://www.fraserinstitute.org/studies/economic-freedom-what-is-it-how-is-it-measured-and-how-does-it-affect-our-lives?ref=bluegrassinstitute.org) have built on the Fraser Institute’s research. This literature demonstrates that economic freedom correlates with higher incomes, faster growth, more entrepreneurship, better labor outcomes, cleaner environments, and even greater life satisfaction. States like Idaho, North Carolina, and North Dakota that significantly increased economic freedom over the past two decades have dramatically outperformed states that moved in the opposite direction. Kentucky can join the ranks of these [“liberator“](https://www.fraserinstitute.org/studies/liberators-us-states-that-increased-their-economic-freedom-in-21st-century?ref=bluegrassinstitute.org) states. The roadmap is clear: continue reducing income taxes toward elimination, repeal the inheritance tax, reform occupational licensing, and pursue policies that transition Kentuckians from government dependency to private-sector prosperity. Kentucky’s neighbors have shown it can be done. Tennessee’s abolition of its income tax, combined with disciplined spending and labor market freedom, has made it one of the fastest-growing states in America. Kentucky can follow — but only if state leaders have the courage to embrace economic freedom as the foundation for future prosperity. --- [*Matthew D. Mitchell*](https://www.fraserinstitute.org/profile/matthew-d-mitchell?ref=bluegrassinstitute.org) *is a Senior Fellow in the Centre for Human Freedom at the Fraser Institute.* [*Caleb O. Brown*](https://www.bluegrassinstitute.org/author/) *is the CEO of the Bluegrass Institute.* --- *This piece originally appeared in the* [*Lexington Herald-Leader*](https://www.kentucky.com/opinion/op-ed/article315153645.html?ref=bluegrassinstitute.org)*.* ### Kentucky’s licensing rules block sexual assault survivors from accessing care URL: https://www.bluegrassinstitute.org/sanes-malamet-plemmons/ Last updated: 2026-03-23T15:16:32.000Z “Survivors shouldn’t be asked to have the courage to make that decision twice in one day.” That’s what an advocate [said](https://www.lpm.org/investigate/2019-09-03/lacking-sexual-assault-nurses-some-ky-hospitals-illegally-turn-victims-away?ref=bluegrassinstitute.org) of sexual assault survivors who arrive at a hospital that lacks a sexual assault nurse examiner (SANE) and are told to go elsewhere. At Baptist Health in Louisville, that’s exactly what happened in 2018\. A survivor sought hospital care. The hospital had no SANE — a nurse specially trained in medical-forensic sexual assault care — and started calling around to find another hospital to send her. “It just felt really wrong,” Denise Carter, the nursing director, later told a reporter for Louisville Public Media. This is not an isolated incident. Kentucky’s SANE shortage means many survivors do not get the care they need after the worst experience of their lives. Survivors are often expected to travel many miles in the hope of receiving treatment and compassionate support, all while being unable to use the bathroom, shower, change clothes or eat. Many give up entirely and simply go home. This past December, the Kentucky Legislative Research Commission (LRC) [reported](https://apps.legislature.ky.gov/lrc/publications/ResearchReports/RR501.pdf?ref=bluegrassinstitute.org) that 100 of Kentucky’s 120 counties have no SANEs. Although the LRC reports that licensed SANEs have doubled since 2019, the access crisis still persists. Credentials and licensure don’t equal access. Thankfully, the legislature is responding. [Current legislation](https://apps.legislature.ky.gov/record/26rs/hb134.html?ref=bluegrassinstitute.org) would create a SANE coordinator to recruit nurses, facilitate training and build relationships with hospitals and rape crisis centers. It also establishes a public SANE registry. This is an encouraging step in the right direction. More infrastructure to support, coordinate and recruit SANEs is sorely needed. And yet even this doesn’t address a deeply flawed framework. A recent [Cato Institute analysis](https://www.cato.org/policy-analysis/licensing-requirements-would-block-care-justice-sexual-assault-victims?ref=bluegrassinstitute.org) — of which one of us is a co-author — examined SANE licensure requirements across the country. The analysis found that mandatory licensing or certification increases barriers to care, slows the profession’s development and exacerbates suffering. These regulations often subvert the needs of survivors and nurses and protect the interests of physicians and other practitioners. Kentucky is a case study in this failure. For nearly 30 years, Kentucky [has required](https://apps.legislature.ky.gov/law/kar/titles/201/020/411/?ref=bluegrassinstitute.org) practicing registered nurses to obtain an additional state license before performing sexual assault forensic exams. The result is heartwrenching, raising the cost and burden of entering the field, driving burnout among those who qualify and concentrating the profession in urban areas where training and jobs are more available. The new SANEs coordinator will be recruiting and organizing nurses into the same restrictive system. Kentucky is [one of only six states](https://www.cato.org/policy-analysis/licensing-requirements-would-block-care-justice-sexual-assault-victims?ref=bluegrassinstitute.org) blocking registered nurses from performing full medical forensic exams. Forty-four other states rely on a multilayered system of voluntary certification, employer review, malpractice insurance, health system vetting and professional standards maintained by respected third-party organizations. Perversely, Kentucky makes it illegal for qualified and capable nurses to provide a full exam to sexual assault survivors without an additional state license. However, a physician with no SANE training at all can provide exams without restriction. A majority of both nurses and survivors are women, and a majority of physicians and assailants are men. The SANE licensure system not only reinforces barriers to access but maintains a deeply troubling form of gender injustice. The people often best suited and qualified to help assault survivors are the ones the state blocks. The licensure barrier also blocks one of the most important ways to address the shortage, especially for rural Kentuckians: tele-SANE, in which a remotely-located SANE guides a local nurse through the forensic exam. Under [current Kentucky law](https://www.law.cornell.edu/regulations/kentucky/201-KAR-20-411?ref=bluegrassinstitute.org), a local RN cannot conduct a full forensic exam, even with a trained SANE guiding the process remotely. A coordinator cannot connect survivors to care or nurses to survivors if the licensure laws forbid it. SANEs also collect and protect vital evidence and often provide testimony crucial for identifying perpetrators and bringing them to justice. Their work helps get assailants off the street and makes Kentucky safer. Lawmakers should be commended for finding ways to help survivors and bring attention to the often silent, shame-filled, and too-common experience of sexual assault. They should go further and eliminate the SANE licensure requirement entirely. Many other reforms are necessary. But the first step is clear: Allow RNs to perform forensic exams under voluntary certification and other safeguards, as 44 other states already do. The Baptist Health nursing director was right. It feels wrong, and it is. Sexual assault survivors should not face extreme barriers to care in their time of need. Instead of a Band-Aid, Kentucky should fix the system itself. The next survivor who shows up at a Kentucky emergency room deserves it. --- [*Akiva Malamet*](https://www.bluegrassinstitute.org/author/akiva-malamet/) *is a scholar at the Bluegrass Institute and co-author of the Cato Institute policy analysis “*[*Licensing Requirements Would Block Care and Justice for Sexual Assault Victims*](https://www.cato.org/policy-analysis/licensing-requirements-would-block-care-justice-sexual-assault-victims?ref=bluegrassinstitute.org)*.”* [*Alicia Plemmons*](https://knee.wvu.edu/contact-us/directory/dr-alicia-plemmons?ref=bluegrassinstitute.org) *is director of the Knee Regulatory Research Center at West Virginia University, where she is also director of the Center for Free Enterprise and an assistant professor of General Business.* --- *This piece originally appeared in the* [*Kentucky Lantern*](https://kentuckylantern.com/2026/03/23/kentuckys-licensing-rules-block-sexual-assault-survivors-from-accessing-care/?ref=bluegrassinstitute.org)*.* ### Why Tax Cuts Matter in Kentucky URL: https://www.bluegrassinstitute.org/why-tax-cuts-matter-in-kentucky/ Last updated: 2026-03-21T13:05:43.000Z Rea Hederman, coauthor of the Bluegrass Institute's "[Continuing Kentucky Tax Reform Efforts](https://www.bluegrassinstitute.org/continuing-ky-tax-reform-efforts/)," discusses the implications of Kentucky maintaining or lowering personal income tax rates with Jim Waters of Kentucky's Voice radio. ### Bluegrass Institute at the Capitol: Continuing Kentucky Tax Reform Efforts URL: https://www.bluegrassinstitute.org/bluegrass-institute-at-the-capitol-continuing-kentucky-tax-reform-efforts/ Last updated: 2026-03-19T13:03:18.000Z On March 9, Bluegrass Institute CEO [Caleb O. Brown](https://www.bluegrassinstitute.org/author/calebobrown) was joined by Buckeye Institute Vice President of Policy [Rea Hederman](https://www.buckeyeinstitute.org/experts/detail/rea-s-hederman-jr?ref=bluegrassinstitute.org) to present lawmakers with new research on the economic impact of Kentucky's ongoing income tax reform. The joint report, produced using Buckeye's peer-reviewed dynamic macroeconomic model, finds that reducing the personal income tax rate to 3.5% in 2026 is projected to generate more than $500 million in economic growth, create over 2,000 new jobs, spur $260 million in new business investment, and put $200 million more in consumer spending back into the Kentucky economy. Over the next decade, the compounding effects of reform could push those gains to nearly $2 billion in GDP growth and 7,000 new jobs. The report also models a bolder scenario: reducing the rate further to 3% in 2027\. That move would produce an estimated $810 million in GDP growth in its first year alone, nearly $400 million in business investment, and close to 3,000 new jobs. With Kentucky's strong fiscal position and growing competition from states like Ohio—which is moving to a 2.75% flat rate—the case for staying the course and going further has never been stronger. Read the full report [here](https://www.bluegrassinstitute.org/continuing-ky-tax-reform-efforts/). ### Kentucky’s Blood Bill Promises Autonomy—But Delivers Mandates URL: https://www.bluegrassinstitute.org/singer-blood-bill/ Last updated: 2026-03-19T12:02:43.000Z Earlier this month, Kentucky Republican State Representative Candy Massaroni introduced [House Bill 752](https://legiscan.com/KY/text/HB752/2026?ref=bluegrassinstitute.org), which would give patients the right to receive blood transfusions from a donor they choose—including their own previously donated blood—while restricting hospitals and blood banks from refusing such directed donations and requiring insurers to cover them. At first blush, one would think this bill strikes a blow for patient autonomy. The core idea, allowing patients to choose their own blood donor, including banking their own blood for later use, fits with the core principles of individual autonomy and voluntary exchange. But a deeper dive into the bill’s specifics reveals its medical autonomy comes with a heavy dose of government compulsion. It requires private insurers, Medicaid, and state employee health plans to cover directed or autologous transfusions—another insurance mandate that overrides voluntary contracts between insurers and customers—and the added costs may increase premiums. It also creates new regulatory oversight and potential civil liability, empowering state officials to investigate hospitals and blood banks. And it forces private institutions with their own safety protocols and legal responsibilities to accommodate directed donations, whether they want to or not. In other words, the bill promotes “medical freedom” by expanding government mandates over insurers and private medical providers. Hospital associations and transfusion specialists have consistently opposed these directed-donation bills, mainly citing practical reasons rather than ideological ones. Modern blood banking depends on pooling donations and managing them as a shared inventory. Blood expires within weeks, requiring hospitals to continuously balance blood types, shelf life, and unpredictable patient needs. Reserving units for specific patients reduces flexibility and can cause waste if the blood isn’t used. It can also complicate emergency care. In cases of trauma or severe bleeding, patients often need blood within minutes, and hospitals depend on immediate access to compatible blood—not from a specific donor. Hospitals also worry about regulatory conflicts, liability, and increased costs. Transfusion practices are governed by strict standards established by the FDA, the [Joint Commission](https://www.jointcommission.org/en-us?ref=bluegrassinstitute.org) (which accredits hospitals and health organizations)**,** and professional groups like the [Association for the Advancement of Blood and Biotherapies](https://www.aabb.org/?ref=bluegrassinstitute.org). Hospitals fear that state mandates could conflict with these rules and expose them to legal risk if something goes wrong. Directed donations may also require additional testing, tracking, and sometimes irradiation of blood from relatives, raising expenses without necessarily enhancing safety. Many hospital groups quietly note that these bills are often driven by requests for “unvaccinated blood,” which blood banks do not track. Their main argument is that the anonymous volunteer blood system functions well. The real question is whether the government should compel private hospitals to accommodate patient preferences or let them set their own transfusion policies. The current debate over “directed donations”—where patients request blood from a specific donor—recalls a similar controversy during the early HIV/AIDS crisis in the 1980s. Back then, before reliable screening tests existed, many patients feared the blood supply and asked hospitals to use blood from friends or relatives instead. But once HIV testing and other screening technologies improved, [studies](https://pmc.ncbi.nlm.nih.gov/articles/PMC8442217/?ref=bluegrassinstitute.org) showed that directed donations were [not safer](https://www.fda.gov/vaccines-blood-biologics/safety-availability-biologics/important-information-about-directed-blood-donations-are-not-medically-indicated?ref=bluegrassinstitute.org) and sometimes carried slightly higher risks than blood from anonymous volunteer donors. One reason is that anonymous donors may feel more comfortable disclosing sensitive risk factors during screening, while friends or relatives may feel pressure to donate even if they shouldn’t. As a result, transfusion specialists and organizations like the American Red Cross shifted toward the modern system of a pooled, anonymous blood supply, which allows for consistent screening and efficient management of blood types and inventory. Today, the U.S. blood supply—regulated by the FDA and supported by advanced testing—is among the safest in the world, with an estimated HIV transmission risk of about [0.23 per one million donations](https://pubmed.ncbi.nlm.nih.gov/40916465/?ref=bluegrassinstitute.org). In that sense, today’s push for directed-donation laws is more a revival of a debate in transfusion medicine that was largely settled decades ago than a medical breakthrough. If lawmakers truly want to promote medical autonomy, they should allow patients and providers to make voluntary arrangements without government interference. Mandating how hospitals manage their blood banks, what insurers must cover, and how medical professionals practice transfusion medicine does the opposite. You can’t promote medical freedom by imposing it through government compulsion. --- *Jeffrey A. Singer, MD, practices general surgery in Phoenix, Arizona and is a senior fellow at the Cato Institute.* ### Freedom to Distill featured on WAVE 3 News URL: https://www.bluegrassinstitute.org/freedom-to-distill-featured-on-wave-3-news/ Last updated: 2026-03-16T12:02:32.000Z On March 5, the Bluegrass Institute proudly welcomed Robert Alt of the Buckeye Institute to discuss his case [*Ream v. U.S. Department of Treasury*](https://www.buckeyeinstitute.org/issues/detail/ream-v-us-department-of-treasury?ref=bluegrassinstitute.org)*,* in which his client has sued the federal government for the right to distill rye whiskey at home. The implications of this case go far beyond the cask: currently before the U.S. Court of Appeals for the Sixth Circuit, it has the potential to overturn *Wickard v. Filburn*, finally gutting Washington’s ability to meddle in purely private, intrastate activities. Our friends at WAVE 3 News joined us here in Louisville to cover the event, we hope you'll enjoy the segment above. ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) ### Bluegrass Institute Reacts to Gov. Beshear's Rejection of K-12 Scholarships for Kentucky Students (WAVE3) URL: https://www.bluegrassinstitute.org/bluegrass-institute-reacts-to-gov-beshears-rejection-of-k-12-scholarships-for-kentucky-students-wave3/ Last updated: 2026-03-14T16:14:59.000Z Governor Andy Beshear vetoed legislation that would have allowed Kentucky families to take advantage of scholarship tax credits without impacting state taxes or revenues. The Bluegrass Institute reacts to the decision. Our full statement is [here](https://www.bluegrassinstitute.org/on-governor-beshears-veto-of-house-bill-1/). Read more of our work on [education freedom](https://www.bluegrassinstitute.org/tag/education-freedom/). ### On Governor Beshear's Veto of House Bill 1 URL: https://www.bluegrassinstitute.org/on-governor-beshears-veto-of-house-bill-1/ Last updated: 2026-03-13T20:03:56.000Z **FOR IMMEDIATE RELEASE** Contact: Joe Verruni (JLV - at - bluegrassinstitute.org) *A statement from Bluegrass Institute CEO Caleb O. Brown:* Education isn’t a jobs program. It’s a service we perform for future generations. Governor Beshear’s veto of a scholarship tax credit program today is a clear example of a politician protecting entrenched special interests at the expense of young people across the commonwealth. The legislation [would allow Kentucky families to access scholarships for K-12 education](https://www.bluegrassinstitute.org/scholarship-tax-credits/) funded by private donations that qualify for a federal tax credit — at no cost to Kentucky taxpayers. The governor's decision to block that opportunity reflects a philosophy that treats the education establishment as an end, not a means to serve Kentucky’s young people. ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) In the end, the vote wasn't strictly partisan. Rep. Tina Bojanowski — a public school teacher from Louisville and a Democrat — [crossed party lines to vote yes](https://kentuckylantern.com/2026/02/24/kentucky-would-opt-into-federal-plan-for-private-school-tuition-aid-under-gop-bill/?ref=bluegrassinstitute.org). Bojanowski said she believed "in my heart and soul that [this will help public education students](https://www.kentuckynewera.com/cadiz%5Frecord/news/article%5Fae04048b-3746-595f-bae6-c7a8e2504433.html?ref=bluegrassinstitute.org)," adding that she intended "to do everything that I can to ensure that we have scholarship granting organizations that help public education students and students with disabilities." That’s not the voice of someone trying to undermine public education. That is the voice of someone putting children before politics. Governor Beshear vetoed the bill anyway. All but one of Kentucky’s neighbors — Indiana, Missouri, Ohio, Tennessee, Virginia, and West Virginia — have opted into this federal program. While families in those states gain access to new educational options, the governor of Kentucky chose instead to keep Kentucky students out. For more than two decades, scholars at the Bluegrass Institute [have argued that educational freedom and parental choice are not threats to quality schooling](https://www.bluegrassinstitute.org/tag/education-freedom/). As bill sponsor Rep. Kim Moser put it, the bill "would not cost Kentucky taxpayers a dime, but it would allow Kentucky students to take advantage of scholarships granted by scholarship granting organizations." Every child in this commonwealth deserves a chance to find a learning environment where they can thrive. No governor should stand in the way of that. [*Caleb O. Brown*](https://www.bluegrassinstitute.org/author/calebobrown/) *is the CEO of the* [*Bluegrass Institute*](https://www.bluegrassinstitute.org/)*.* ### Continuing Kentucky Tax Reform Efforts URL: https://www.bluegrassinstitute.org/continuing-ky-tax-reform-efforts/ Last updated: 2026-03-09T13:00:16.000Z ## Executive Summary Kentucky has established itself as a national leader in pro-growth tax reform after landmark legislation in 2018 replaced a complex graduated income tax with a flat rate and broadened the sales tax base. These structural improvements have propelled the Commonwealth’s business tax climate ranking from 37th to 18th and built a historic Budget Reserve Trust Fund. To sustain this competitive momentum and address unprecedented workforce mobility, The Buckeye Institute used its dynamic scoring model—STELA—to model the economic effects of the next two phases of tax reform: a scheduled reduction to a 3.5 percent individual income tax rate in 2026, and a hypothetical reduction to three percent in 2027\. The dynamic analysis confirms that reducing taxes on labor triggers immediate economic growth. As the tax burden falls, the economy experiences a sharp acceleration in capital mobilization and labor supply. This activity generates a powerful feedback loop in which new economic growth creates new state revenue, significantly offsetting the static costs of the rate cuts. STELA forecasts that Kentucky’s growth domestic product (GDP) will grow by $510 million and private investment will surge by $260 million as capital is deployed early, reducing the static revenue loss of $718 million to a dynamic loss of just $410 million. A subsequent reduction to three percent in 2027 amplifies these gains with increased business investment. Once fully implemented, the deeper tax cut raises GDP by $810 million and private investment by $370 million, containing the dynamic revenue loss to $640 million. By 2034, fully phasing in the three percent flat tax will permanently elevate Kentucky’s economic baseline. STELA forecasts that annual GDP will rise by $1.99 billion, supported by $850 million in new annual investment and 7,000 new jobs. This analysis confirms that eliminating Kentucky’s personal income tax remains a fiscally responsible path to sustained growth, allowing the commonwealth to compete effectively for talent and investment in an increasingly mobile economy. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/03/scenario-two.png) ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) ## Introduction States across the country have recently pursued pro-growth tax reforms designed to flatten or eliminate their income taxes—and for good reason. Income taxes discourage work and investment and hinder productivity. Economic research routinely confirms that only corporate taxes are more damaging to growth and prosperity than personal income taxes. By taxing personal income, states inevitably influence incentives for earning that income: the less income that earners may keep, the less incentive they have to earn it. Internationally, a 10 percent reduction in the marginal income tax rate increased the employment rate in the average Organisation for Economic Co-operation and Development (OECD) country by 3.7 percentage points, while domestically, state taxes here reduce personal income over the long-term as negative economic incentives accumulate. Acknowledging that economic reality, Kentucky made a bold, necessary policy move with landmark legislation in 2018 that converted its complex graduated income tax into a single, flat-rate tax of five percent and strategically broadened the sales tax base to fund the initial rate reduction responsibly. Subsequently, House Bill 8 in 2022 began continuous rate reductions designed to phase out the individual income tax entirely. These structural changes have proven dramatically successful, fueling consecutive record-breaking budget surpluses and propelling Kentucky’s national tax ranking from 37th in 2018 to a more competitive 18th by 2024\. A measure of this success, Kentucky’s General Fund revenue rose 2.8 percent to $15.57 billion in fiscal year 2024, as the state’s personal income tax, sales tax, and use tax each contributed approximately 37.3 percent to the total fund. Individual income tax collections settled at $5.81 billion, a slight 0.6 percent decline driven by the reduction in the statutory tax rate, while sales and use tax receipts rose to $5.80 billion on the strength of 4.1 percent growth in consumer spending. Business taxes also performed well, with corporate income and limited liability entity tax revenue climbing 2.3 percent to $1.25 billion (eight percent of the total). These totals, along with other smaller tax receipts, have raised Kentucky’s Budget Reserve Trust Fund to $3.76 billion, and reached the revenue triggers needed for the next phase of reform. Accordingly, the Kentucky legislature passed House Bill 1 (2025), which will reduce the income tax rate from four to 3.5 percent in 2026 as a pure tax cut paid for by the commonwealth’s own economic success. And Kentucky’s success looks poised to continue. Using its dynamic analytical tool, The Buckeye Institute has modeled the economic impact of two pro-growth tax reform scenarios: (1) Kentucky’s scheduled personal income tax rate reduction from four to 3.5 percent in 2026, and (2) an additional hypothetical, trigger-based reduction from 3.5 to three percent in 2027\. Both scenarios will unleash significant economic growth, boost private-sector investment, increase personal consumption, and create new jobs across the commonwealth. ### Competitive Tax Policy Matters Having a competitive state tax code matters when trying to retain residents and attract new businesses and workers. States with above-average income tax rates tend to lose population to other states compared to those with lower tax rates, and high progressive income taxes are more likely to drive investment and relocation decisions of successful businesses and workers. Higher taxes on high incomes raise less revenue than anticipated, as more affected taxpayers leave the state and reduce the overall tax base. Such emigration shrinks present and future tax revenues and economic growth, compounding the harm. With high-skilled workers and businesses more mobile now than ever, Internal Revenue Service data confirms significant transfers of taxpayers and income from high-tax to low-tax states. 14 Fortunately, Kentucky’s flat-tax move has already proven advantageous, yielding net population gains in the fight for new residents. But that fight is far from over. The Tax Foundation’s 2026 State Tax Competitiveness Index shows that as other states accelerate their own reforms, Kentucky’s now ranks 25th overall. The commonwealth faces critical economic competition from its neighbors, most notably zero-tax Tennessee (ranked 8th) and low-tax Indiana (ranked 10th). And earlier in 2025, Ohio adopted a flat tax with a top tax rate of 2.75 percent, one of the lowest in the country. To meet the competitive challenge, Kentucky will need further responsible tax reform and prudent fiscal management. The commonwealth’s historic surpluses are not merely a defense against economic downturns but offer strategic assets that provide the state with the economic flexibility to invest in pro-growth reforms that will keep more money in the private sector and make Kentucky’s economy more dynamic and competitive. As Kentucky policymakers consider and pursue viable reforms, they should remember that tax codes should be simple, transparent, neutral, and stable. A simple tax code means that businesses and individuals can spend less time and money on compliance costs, and taxpayers make fewer honest mistakes in their tax filings. A transparent tax code means fewer tax gimmicks, credits, and deductions that reward crony capitalism and special-interest lobbying. A neutral tax code means taxpayers pay the same rate for the same economic activity and their savings are not penalized with multiple investment taxes. And a stable tax code reduces uncertainty, allowing businesses and workers to plan effectively. Kentucky’s plan to continue reducing its flat tax rate to zero aligns with these goals and maintains a low rate across a broad base. ## Modeling the Economic Impact of Tax Cuts ### Scenario 1: Cutting the Personal Income Tax to 3.5% Scenario 1 models the personal income tax cut from four to 3.5 percent, which took effect on January 1, 2026\. The results demonstrate a distinct unlocking effect immediately upon implementation. As the tax burden is reduced, the economy experiences a sharp initial surge in capital mobilization, with investment jumping by $260 million and GDP rising by $510 million in 2026 alone (See Table I). This immediate release of economic activity generates significant dynamic feedback. Following this initial acceleration, the economy grows at a permanently higher level due to the structural improvement in the tax code. By 2034, the sustained incentives are expected to lift annual GDP by $1.76 billion, boost investment by $750 million, and increase consumer spending by $670 million. While the static revenue cost grows over time, this long-term expansion provides a durable offset, supporting the creation of 6,000 new jobs by 2034. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/03/image.png) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/03/image-1.png) ### Scenario 2: Cutting the Personal Income Tax to 3.0% Scenario 2 models the next potential step in Kentucky’s pro-growth reform: a hypothetical reduction of the personal income tax rate from 3.5 percent to three percent. This scenario assumes the state meets its fiscal triggers again, immediately following the 2026 implementation, which would authorize the rate to fall to three percent in 2027\. Upon implementation in 2027, the economy responds immediately, with GDP rising by $810 million and private investment increasing by $370 million in the first year alone (See Table II). STELA forecasts that once this policy is fully phased in (by 2034), it will generate $1.99 billion in new annual GDP, while spurring $760 million in new consumption and $850 million in new private investment. This economic expansion is driven by the creation of 7,000 new jobs. This dynamic growth provides a substantial feedback effect that offsets the static tax reduction. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/03/image-2.png) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/03/image-3.png) ## Conclusion Kentucky must continue its pro-growth tax reforms to compete economically with its low-tax neighbors. Historic fiscal health, driven by prudent management and a record-breaking Rainy Day Fund, allows legislative flexibility for responsible reforms and tax refunds. Facing unprecedented workforce mobility, Kentucky cannot afford to maintain a personal income tax that penalizes work and investment. The commonwealth’s move to a flat-tax was a critical first step, and the legislated path to eliminating the personal income tax altogether will be crucial for attracting and retaining the talent and businesses Kentucky needs. The modeled scenarios confirm that reducing taxes on labor yields more work and more investment, which creates a powerful dynamic feedback effect that generates new state revenue to significantly reduce the net cost of the tax cut. This analysis gives policymakers a better understanding of the tax policy’s full impact and confirms that eliminating Kentucky’s personal income tax remains a fiscally responsible path to sustained economic growth and a more competitive future. [Continuing Kentucky's Tax Reform Efforts20260309 Continuing Kentucky's Tax Reform Efforts.pdf880 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2026/03/20260309-Continuing-Kentucky-s-Tax-Reform-Efforts.pdf "Download") --- *Rea S. Hederman Jr. is executive director of the Economic Research Center and vice president of policy at The Buckeye Institute.* *Sai C. Martha is an economic research analyst at The Buckeye Institute.* ### 'Silent' Property Tax Increases in Kentucky (Kentucky Focus, KNN) URL: https://www.bluegrassinstitute.org/silent-property-tax-increases-in-kentucky-kentucky-focus-knn/ Last updated: 2026-03-08T11:57:13.000Z Bluegrass Institute CEO Caleb O. Brown discusses how localities raise your property taxes without your input. On the Kentucky Focus show from the Kentucky News Network, Bluegrass Institute CEO Caleb O. Brown discusses his co-authored op-ed on silent property tax increases undertaken by localities without proper public input. Related: "[KY's flawed property tax system allows silent increases](https://www.bluegrassinstitute.org/kys-flawed-property-tax-system-allows-silent-increases/)" by Levi Anderson and Caleb O. Brown ### Gary Houchens discusses the Chesterton Academy on The DeCesare Group Podcast URL: https://www.bluegrassinstitute.org/gary-houchens-decesare-chasterton/ Last updated: 2026-07-22T20:41:52.000Z On March 2, 2026, [Dr. Gary Houchens](https://www.bluegrassinstitute.org/author/gary-houchens/), Board Chair of Chesterton Academy, joined The DeCesare Group Podcast to discuss the August launch of the Chesterton Academy of Bowling Green, a new Catholic high school designed to fill a 60-year void in local Catholic education. Starting with a small founding class of ninth and tenth graders at St. Joseph Church, the academy offers a classical, Latin-based curriculum deeply focused on rigorous academics, the liberal arts, and spiritual formation in the tradition of G.K. Chesterton. By providing an affordable, faith-based educational alternative, the school aims to meet the growing demand for diverse schooling options in the rapidly expanding South Central Kentucky region. For more, you can read Gary's recent [FAQ on Kentucky’s new Federal Scholarship Tax Credit](https://www.bluegrassinstitute.org/scholarship-tax-credit-faq/) or watch his [2025 testimony to the Kentucky legislatures' Budget Review Subcommittee on Education](https://www.bluegrassinstitute.org/expand-innovative-education-opportunities-to-all-students/). ### Protect Conscience — But Fix What’s Really Driving Kentucky’s Doctor Shortage URL: https://www.bluegrassinstitute.org/protect-conscience/ Last updated: 2026-03-03T13:48:32.000Z Kentucky lawmakers are considering [Senate Bill 72](https://apps.legislature.ky.gov/record/26rs/sb72.html?ref=bluegrassinstitute.org), titled the “[Health Care Heroes Recruitment and Retention Act](https://www.billtrack50.com/billdetail/1927351/62836?ref=bluegrassinstitute.org).” The bill would allow health care professionals — and institutions — to refuse participation in non-emergency medical services that violate their “sincerely held religious, moral, or ethical principles.” It would also shield them from civil and criminal liability and prohibit employers or licensing boards from disciplining them for exercising those rights. Protecting conscience is a serious and legitimate concern. Physicians are not interchangeable technicians. They are moral agents. In a free society, the government should not force a doctor to participate in a non-emergency procedure that violates deeply held beliefs. Whether the issue involves abortion, assisted suicide, or gender-transition procedures, compelling participation through state power raises important questions. If SB 72 simply ensured that the government cannot coerce unwilling professionals into performing non-emergency services, the issue would be straightforward. But the bill goes further — and it is also being framed as a response to Kentucky’s physician shortage. That claim deserves scrutiny. As someone who has practiced medicine for decades, I can say with confidence that most physicians do not choose where to practice based on whether they might someday be forced to perform a procedure they oppose. Doctors consider reimbursement levels, malpractice climate, regulatory burden, hospital infrastructure, call responsibilities, professional autonomy, and quality of life. Those are the factors that drive recruitment and retention. If Kentucky wants to attract more clinicians to provide more health care services, reducing [regulatory friction](https://www.goldwaterinstitute.org/policy-report/who-is-using-telehealth/?ref=bluegrassinstitute.org), expanding [scope-of-practice](https://www.cato.org/blog/health-care-scope-practice-laws-reveal-another-weakness-response-covid-19-pandemic?ref=bluegrassinstitute.org) flexibility, and eliminating unnecessary [barriers](https://www.cato.org/blog/more-states-move-let-experienced-foreign-doctors-serve-their-patients?ref=bluegrassinstitute.org) to entry, such as [certificate-of-need laws](https://www.cato.org/testimony/testimony-kentucky-special-committee-certificate-need-task-force?ref=bluegrassinstitute.org), would likely have a far greater impact than expanding conscience protections. That does not mean the bill’s core principle is unimportant. It means we should be honest about what will and will not solve workforce shortages. There is another structural issue within the bill itself: freedom in health care runs in more than one direction. It includes the freedom of professionals to practice according to conscience. It also includes the freedom of private hospitals and clinics to define their missions and set expectations for employees. If a hospital openly provides certain services and hires physicians for that purpose, that arrangement is voluntary. If a physician later decides they cannot in good conscience provide those services, they are free to seek employment elsewhere. Likewise, the institution should retain the ability to determine whether it can continue employing someone who declines to perform core duties. If SB 72 prevents private employers from enforcing contractual expectations, it does more than protect conscience. It reshapes private employment relationships. The bill also grants immunity from civil liability for professionals who exercise conscience rights. That provision deserves careful attention. In most areas of law, disputes are resolved through established legal standards. Granting blanket immunity in advance shields one group from ordinary accountability. Health care already operates within a complex legal and regulatory framework. Adding additional layers of statutory immunity risks unintended consequences. During debate, lawmakers also raised the question of whether broadly defined “sincerely held beliefs” could justify refusing care to a person rather than declining a specific procedure. Supporters emphasize that objections are limited to particular services, not patients. That distinction is crucial. Refusing to perform a procedure is categorically different from refusing to treat someone because of race, religion, or sexual orientation. Patients need confidence that when they seek care, they will not face arbitrary denial. Trust is foundational in medicine. There is a narrower path available. The state should not compel participation in non-emergency procedures. Licensing boards should not punish professionals solely for declining to perform services outside emergency care. Protecting individuals from government coercion is a sound principle. Beyond that, private institutions should remain free to define their missions and employment standards, and ordinary contract and tort law should continue to govern disputes. Kentucky can protect conscience without overstating its impact on physician shortages or weakening accountability. If lawmakers truly want to strengthen recruitment and retention, the most effective reforms will be those that reduce regulatory burdens and expand professional opportunity — not those that assume doctors are making career decisions based on hypothetical moral conflicts. Conscience deserves protection. But doctors are not choosing where to practice based on theoretical moral disputes. They are choosing based on whether the environment allows them to practice medicine freely and sustainably. If Kentucky wants more physicians, it should start by removing the barriers that stand in their way. --- [*Dr. Jeffrey A. Singer*](https://www.cato.org/people/jeffrey-singer?ref=bluegrassinstitute.org) *is a practicing surgeon and senior fellow in health policy at the Cato Institute. This piece was cross-posted at cato.org.* ### I was two when my mom went to jail, Kentucky can do better URL: https://www.bluegrassinstitute.org/mom-went-to-jail-kentucky-can-do-better/ Last updated: 2026-03-02T13:02:42.000Z *This piece was written in reference to the* [*Family Preservation and Accountability Act*](https://www.bluegrassinstitute.org/the-family-preservation-and-accountability-act/) *(HB464) now under consideration in the Kentucky General Assembly.* --- I was two years old when my mom went to jail. I do not remember everything she remembers. I was too young. What I do remember is what came after. I remember missing her. I remember confusion. I remember loss before I had the words for it. What I see clearly now is how hard it is for her to talk about it. Every time my mom shares her story, I can see the pain return. The guilt of missing my early years hasn’t really left her. It hurts me to watch my mom relive the worst moments of her life. I can no longer sit quietly and watch her carry that weight alone. That’s not the man my family raised me to be. ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) When my mom was incarcerated, I went to live with my grandparents. My grandma had me say goodnight to my mom’s picture every night. I would run to our mailbox almost every day, hoping for a letter or a drawing. That was how I knew she was still there- somewhere. I knew that she had not disappeared. Some of my earliest memories are visiting my mom while she was in treatment. I thought she was in a special school. I was always excited to see her. I did not understand why she could not come home. I just knew something was missing. My mom was not a bad parent. She was sick. She asked for help. She asked for treatment. Instead, she was jailed with no counseling or support. When she relapsed, she begged again and was sent to prison. That punishment did not just affect her. It affected me and our entire family. Eventually, she did receive treatment. On my fourth birthday, she was paroled to a long-term program. She tells me I kept touching her face in the car, like I was trying to figure out if she was real. I do not remember that moment, but I believe it. I had already learned that parents can disappear. That program changed her life. It came years too late. Today, my mom is sober. I graduated as an honor roll student and an athlete. We are close. I am lucky. But my story is not unique, especially in rural Kentucky. Across this state, kids grow up with parents cycling in and out of jail for low-level, nonviolent offenses tied to addiction. Grandparents step in. Families do their best while the system pulls them apart. Kentucky has one of the highest rates in the nation of children with an incarcerated parent. Those are not statistics. Those are kids saying goodnight to pictures and running to mailboxes, hoping. The Family Preservation and Accountability Act offers a better way. It allows judges to consider community-based alternatives for primary caregivers, holding people accountable while keeping families connected and giving parents a real chance to recover. When families stay connected, healing happens faster. For parents. And for kids. I am here because my mom eventually got help. Other families deserve the same chance. No child should lose a parent simply because that parent needs treatment. --- *Gavin Herrington is a Kentucky college student. His mother, Brittany, is a peer support specialist and advocate for people recovering from drug and alcohol addiction.* *This piece first appeared in the* [*Northern Kentucky Tribune*](https://nkytribune.com/2026/02/opinion-gavin-herrington-i-was-two-when-my-mom-went-to-jail-kentucky-can-do-better/?ref=bluegrassinstitute.org)*.* ### Modest reform to KY regulation could mean big business gains URL: https://www.bluegrassinstitute.org/cj-reg-reform/ Last updated: 2026-02-25T17:00:54.000Z Anyone who cares about Kentucky’s economy needs to confront one massive number: 127,000. That’s how many state-level regulatory restrictions currently bind the private sector. Words like “shall,” “must” and “may not” create legal obligations on individuals and businesses alike. And nearly 9% of those were added in just the last five years. Thankfully, a massive stack of accumulated rules also presents a powerful opportunity. [New research](https://www.bluegrassinstitute.org/regulatory-reform-mclaughlin/) from the Bluegrass Institute shows how Kentucky policymakers can give this economy a serious boost that leaves virtually everyone better off. ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) **A growing weight** The issue is not any single regulation, many of which are important. It’s the weight of the whole system. Over time, regulations accumulate. New rules are added more readily than old ones are revisited. The result is a steadily expanding stock of requirements — including thousands that are outdated, duplicative or unnecessarily complex. Since 2020, Kentucky’s regulatory restrictions have grown by 8.8% — about double the rate in the median state. In 2024, Kentucky surpassed that median state in total restrictions. Last year, it was the fourth-most regulated in its region (second-most on a per-capita basis). The code contains roughly 6.4 million words — nearly eight times as many as the King James Bible. Reading briskly, it would take almost an entire legislative session just to get through it. Decades of research show that regulatory accumulation suppresses investment, slows productivity growth and reduces business startups. It raises costs for businesses, especially smaller ones which lack legal and administrative departments. These costs reach consumers. A 10% increase in regulation has been linked to nearly a 1% increase in consumer prices, with the largest burden falling on lower-income households. Over time, all of this quietly drains states of capital, talent and entrepreneurial activity. But because so much regulatory accumulation has occurred in Kentucky, even modest reforms targeting the least-effective regulations could yield meaningful gains. Realistic reform scenarios from other states could boost Kentucky’s annual GDP growth by between 0.16 and 1.56 percentage points. That may sound small. It’s not. **Reducing regulations over time** Growth compounds. Let’s assume Kentucky’s real GDP is set up to grow by 1.64% each year and reach roughly $285 billion by 2037\. With a 20% reduction in regulatory restrictions, the economy would be about $14 billion larger by that year. Under a more ambitious 40% reduction, the gain could approach $42 billion. That’s like creating four or five new bourbon industries *from scratch*. This does not require dismantling core protections for health, safety or the environment. Other jurisdictions have demonstrated what’s possible. In the early 2000s, British Columbia reduced regulatory requirements by roughly 40% over three years and experienced a sustained increase in economic growth. Idaho implemented “zero-based regulation,” requiring state agencies to periodically justify their rules. Virginia recently eliminated roughly one-quarter of its regulatory requirements and estimates more than $1.2 billion in annual [savings for its citizens](https://www.bluegrassinstitute.org/regulatory-transparency-now/). These were not symbolic steps. They relied on measurement, transparency and explicit reduction targets. Agencies inventoried existing rules. They explained why some remain necessary and cost-effective. They cut rules that persisted simply because no one had yet been tasked with reviewing them. **Too much regulation stunts investment** The tools exist to establish a multi-year reduction target — 10%, 20%, or more — and require agencies to review and streamline accordingly. Artificial intelligence (under human supervision) makes this process far less administratively burdensome than in the past. Kentucky competes daily with Tennessee, Indiana, Ohio and Virginia for business investment and job creation. When regulatory accumulation outpaces peer states, it tilts that competition. Investors notice. Entrepreneurs notice. Workers notice when better jobs are available next door. Doing nothing — that is, allowing regulations to quietly accumulate without looking at the whole picture — will make the economic drag more pronounced. Taking action would substantially improve Kentucky’s growth and competitiveness. A modest 10% reduction would make a difference. Twenty or 30 percent could materially alter the state’s long-term economic trajectory. Forty percent would be transformative. It’s a choice: Look the other way or treat the regulatory code as something to be measured, managed and modernized. At stake are stronger businesses, higher wages, lower prices and greater opportunity for families across the state. That’s an opportunity worth taking. --- *This piece originally appeared in the* [*Louisville Courier Journal*](https://www.courier-journal.com/story/opinion/contributors/2026/02/24/kentucky-regulation-restriction-reform-business-economic-growth/88649991007/?ref=bluegrassinstitute.org)*.* ### Kentucky Cities Need Limits, Not Just Balanced Budgets URL: https://www.bluegrassinstitute.org/limits-not-just-balanced-budgets/ Last updated: 2026-02-23T12:58:19.000Z [Kentucky's 1994 constitutional amendment](https://apps.legislature.ky.gov/Law/Constitution/Constitution/ViewConstitution?rsn=182&ref=bluegrassinstitute.org) requires cities to adopt balanced budgets and prohibits spending beyond revenues. But balanced budgets have become mathematical shell games. Yes, this year's expenditures don't exceed this year's revenues. But what expense did you forgo? What infrastructure maintenance did you defer? What burdens did you push to future generations? A balanced budget tells you nothing about whether the city can weather economic downturns or meet long-term obligations. Cities are sitting on infrastructure maintenance backlogs they're afraid to inventory, much less acknowledge. Roads needing resurfacing. Water mains approaching the end of useful life. Crumbling sidewalks. These don't win elections, so they're pushed aside for higher-profile spending while deferred costs compound. Every June, Kentucky city councils approve balanced budgets. Newspapers report the achievement. Five months later, those same cities report surprising surpluses—or discover deferred maintenance costs that dwarf their pension obligations. For residents trying to make sense of city finances, these contradictions are paralyzing. The problem isn't that Kentucky's municipal leaders lack commitment. It's that they're managing organizations that have become fundamentally amorphous by design. You cannot sustainably manage an organization without defined boundaries. Consider the typical Kentucky city mission: provide the right public services for the community's way of life. What does that mean? The answer shifts with every election cycle, every council turnover, every new political priority. When your scope is "whatever serves the community interest," you've created a mandate for unlimited growth. Budget cycles become exercises in chasing immediate demands rather than genuine financial planning. This matters because how cities set goals determines scope, which drives activities, which generates costs. If your implicit goal is maximizing services—and that's exactly what "community benefit" language produces—then maximizing services necessarily means maximizing taxes and fees. Under this structure, spending will always grow. It's not a flaw; it's the system working as designed. The pattern repeats with municipal utilities. Kentucky cities took over water and wastewater systems decades ago claiming private providers wouldn't serve these areas. But that market hesitation was information; it signaled investment conditions weren't favorable. By preempting market solutions, cities locked themselves into operating complex commercial enterprises they're poorly equipped to manage. Legislative bodies excel at certain functions: defining property rights, enforcing local laws, exercising limited taxing authority. But running monopoly utilities? Managing quasi-commercial activities? Delivering social programs? These require entirely different capabilities. When you layer Public Meetings Act requirements, Open Records obligations, and civil service-style personnel management onto utility operations, inefficiency is inevitable. I've watched utility boards vote for rate increases they didn't need, simply because they could. I've seen well-run Kentucky cities flip councils and deteriorate within a single cycle. I've witnessed finance directors realize, mid-budget preparation, that 99 percent of revenues are already spoken for by contractual obligations—leaving zero room for actual planning. The solution isn't more top-down mandates from Frankfort. Revenue caps might slow growth temporarily, but don't address what drives spending. What Kentucky cities need is fundamental: clearly defined and legally enforceable limits on organizational scope. Legislation should make expanding municipal scope difficult and questioning it easy. Require supermajorities for taking on new functions. Demand rigorous justification before cities enter new lines of business. Make it acceptable—even encouraged—for councils to say "no" to activities outside core competencies. For infrastructure cities already own, the path forward requires long-term thinking. Kentucky municipalities should inventory full maintenance obligations, establish sinking funds for replacement, and begin determining what can transition to private management. This isn't a fire sale: it's strategic divestment. Announce a 10-year timeline to exit certain operations, giving markets time to develop solutions. None of this happens without acknowledging an uncomfortable truth: the current model is failing. Kentucky cities carry obligations they cannot meet with structures that prevent effective management and political incentives rewarding short-term thinking over fiscal sustainability. Papering over these realities with balanced-budget headlines serves no one. For newly elected mayors and council members who genuinely want long-term fiscal health, the work starts with defining what your city actually does—not what it might do or has been asked to do, but what it's equipped to handle given its nature as a local legislative authority with enforcement powers. Everything else is scope creep. Today's decisions about municipal scope will determine whether Kentucky cities enter the next decade as focused, well-managed organizations or sprawling, financially strained entities lurching from crisis to crisis. Drawing those lines requires saying no to constituents, resisting the urge to be all things to all people, and accepting that some problems are better solved outside city government. But it's the only way to build organizations that function beyond the next election cycle. ### WHAS11: Caleb O. Brown reacts to Kentucky Supreme Court rejection of charter schools URL: https://www.bluegrassinstitute.org/whas11-caleb-o-brown-reacts-to-kentucky-supreme-court-rejection-of-charter-schools/ Last updated: 2026-02-21T22:27:23.000Z Bluegrass Institute CEO Caleb O. Brown offers thoughts on the [Kentucky Supreme Court's rejection of charter schools](https://www.bluegrassinstitute.org/bluegrass-institute-kentucky-supreme-court-charter-school-ruling-rests-on-flawed-constitutional-reasoning/). ### Kentucky’s independent workers deserve access to portable benefits URL: https://www.bluegrassinstitute.org/independent-workers-portable-benefits/ Last updated: 2026-02-20T16:47:27.000Z Work comes in many shapes and sizes. In today's economy, traditional 9-to-5 employment is but one option, and more people are choosing alternatives that better fit their values and lives. These workers deserve better access to benefits like health insurance and retirement savings. Over 330,000 Kentuckians earn income as freelancers, contractors or self-employed workers. They include rideshare and delivery drivers, truckers, freelance creatives, child care providers and consultants. Together, they generate more than $18 billion in annual revenue. This workforce is growing, diverse, and vital to the commonwealth's economy — yet state and federal policies haven't kept pace with that reality. Flexibility lets independent workers manage their time, earn on their own terms and pursue family, education or creative goals. According to the [Bureau of Labor Statistics](https://www.bizjournals.com/louisville/organization/bureau-of-labor-statistics?ref=bluegrassinstitute.org), more than 80% of independent workers prefer their current arrangement, and fewer than 9% say they'd rather have a traditional job. Yet the same independence that draws people to this work can also leave them without a safety net. Surveys show that 81% of self-employed workers want portable benefits solutions. Unlike traditional employees, independent workers lack access to health coverage or retirement savings, and even when companies want to offer them voluntarily, they're often discouraged or legally prohibited from doing so. Current labor laws risk classifying such arrangements as "employment," triggering unintended liabilities. As a result, businesses avoid offering help altogether, and workers are left without access to benefits that could make their lives more stable. That's where portable benefits come in. Portable benefits travel with workers as they move between jobs, clients or gigs. Rather than being tied to an employer, these benefits would be linked to the individual. Imagine a system where a trucker, freelancer or child care provider receives contributions from the companies or clients they work with— funds that accumulate in a benefits account they carry throughout their career. This idea preserves what makes independent work appealing while expanding access to financial security. Kentucky could lead by allowing voluntary portable benefits arrangements where businesses can provide benefits to contractors without fear of triggering employment reclassification. Momentum for portable benefits is building nationwide. States like Tennessee, Pennsylvania and Utah have advanced proposals to allow companies to voluntarily contribute to benefits for independent workers. Lawmakers in red and blue states recognize that portable benefits are not a partisan issue — they're a practical one. At the federal level, members of Congress in both chambers have introduced legislation to create a legal safe harbor for these arrangements. What's remarkable is that many workers aren't asking for handouts or government mandates. They're asking for a way to participate in modern systems of security while keeping the independence they value — and portable benefits meet that need. Policymakers have an opportunity to take a human-centered approach to labor law, recognizing that the old model of a single employer providing lifelong benefits no longer fits how people work today. Instead of forcing everyone into the same employment box, Kentucky can allow businesses to experiment with voluntary benefits programs. Kentucky's independent workers span every corner of the economy — from construction and transportation to health care, retail and the arts. They are the contractors building homes, the drivers keeping supply chains running, and the stylists, caregivers and consultants serving local communities. Independent work isn't going away; if anything, it's expanding. Kentucky can either cling to outdated rules that punish flexibility or embrace reforms that make work more inclusive, secure and adaptable. Lifting legal barriers to voluntary portable benefits would mean that independence and security don't have to be at odds. They can, and should, go hand in hand. --- *This piece originally appeared in* [*Louisville Business First*](https://www.bizjournals.com/louisville/news/2026/02/20/kentucky-portable-benefits.html?ref=bluegrassinstitute.org)*.* ### Bluegrass Institute: Kentucky Supreme Court Charter School Ruling Rests on Flawed Constitutional Reasoning URL: https://www.bluegrassinstitute.org/bluegrass-institute-kentucky-supreme-court-charter-school-ruling-rests-on-flawed-constitutional-reasoning/ Last updated: 2026-02-19T20:35:18.000Z **LEXINGTON, KY** — The Bluegrass Institute today expressed serious concern over the Kentucky Supreme Court's decision that [House Bill 9](https://apps.legislature.ky.gov/record/22rs/hb9.html?ref=bluegrassinstitute.org), the Commonwealth's charter school law, violates the Kentucky Constitution. Today's opinion endangers funds the General Assembly regularly appropriates for education delivered outside Kentucky’s system of “common schools.” The ruling places Kentucky among a disadvantaged minority of states when it comes to offering families a variety of education options. ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) Gus LaFontaine, leader of [LaFontaine Preparatory School](https://www.lafontaineprep.org/?ref=bluegrassinstitute.org) (LPS) and appellant in the case decided today, made the following statement: > We’re disappointed that Kentucky children cannot participate in an educational opportunity that is already operating in 46 states. We will continue to offer opportunities to the many families who seek out the educational options that best fit their needs. Bluegrass Institute CEO [Caleb O. Brown](https://www.bluegrassinstitute.org/author/calebobrown/) made the following statement: > For well over a century, the General Assembly has routinely appropriated General Fund dollars to educational programs that plainly do not satisfy the court's definition of a "common school." These include the Kentucky Schools for the Blind and Deaf, the Governor's Scholars Program, the Governor's School for the Arts, the Governor's School for Entrepreneurs, the Craft and Gatton Academies, Bluegrass and Appalachian Youth Challenge Academies, and Kentucky Adult Learner Programs. > These programs receive millions in General Fund appropriations. Under the court's reasoning, every one of these appropriations is constitutionally suspect. The court does not explain how its ruling leaves these beloved programs intact, nor can it. The Bluegrass Institute’s [amicus brief](https://www.bluegrassinstitute.org/bluegrass-institute-files-amicus-brief-urging-kentucky-supreme-court-to-overturn-flawed-school-choice-ruling/) foreshadowed how today’s ruling answers the wrong question. The court addressed whether charter schools qualify as "common schools" before asking the more fundamental threshold question: *Where does the money actually come from?* The Kentucky Constitution's [Section 184](https://apps.legislature.ky.gov/Law/Constitution/Constitution/ViewConstitution?rsn=214&ref=bluegrassinstitute.org) restricts only two categories of funds from being spent on anything other than common schools: (1) the School Fund and its income, and (2) sums specifically raised by taxation *for the purpose* of common school education. Critically, Section 184 places **no restriction whatsoever** on General Fund appropriations. The Court's opinion glosses over this distinction entirely. As argued in the [Bluegrass Institute's amicus brief](http://bluegrassinstitute.org/bluegrass-institute-files-amicus-brief-urging-kentucky-supreme-court-to-overturn-flawed-school-choice-ruling/?ref=bluegrassinstitute.org), the proper first question is whether HB 9 directs constitutionally restricted funds to charter schools — not whether charter schools fit a particular label. If General Fund dollars fund charter schools, the constitutional analysis ends there, in favor of the law's validity. Nothing in the record established that restricted funds, rather than General Fund appropriations, would flow to charter schools. The Court's failure to grapple with this issue raises a serious analytical gap. ### *The* [*Bluegrass Institute*](http://bluegrassinstitute.org/bluegrass-institute-files-amicus-brief-urging-kentucky-supreme-court-to-overturn-flawed-school-choice-ruling/?ref=bluegrassinstitute.org) *works with Kentuckians, grassroots organizations, and business owners to advance freedom and prosperity by promoting individual liberty, limited government, and free markets.* ### Regulatory Reform in Kentucky: An Opportunity for Greater Economic Growth URL: https://www.bluegrassinstitute.org/regulatory-reform-mclaughlin/ Last updated: 2026-02-09T19:39:33.000Z Kentucky’s regulatory code has expanded rapidly in recent years, growing roughly twice as fast as the median state since 2020\. By 2025, the commonwealth had nearly 127,000 regulatory restrictions, leaving it more regulated than the median state and among the most regulated in its region on a per-capita basis. [Regulatory Reform in Kentucky: An Opportunity for Greater Economic Growth20260209\_RegReform\_Bluegrass.pdf663 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2026/02/20260209%5FRegReform%5FBluegrass.pdf "Download") This accumulation carries meaningful economic costs. A larger and more complex regulatory code suppresses investment, productivity growth, and startup formation while raising consumer prices and slowing wage growth. These effects fall disproportionately on small businesses and lower-income households and can also undermine regulatory compliance by overwhelming firms and workers with excessive complexity. ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) At the same time, Kentucky’s large regulatory footprint presents a clear opportunity. The report examines two proven reform strategies—targeted red-tape reduction and regulatory budgeting—that have reduced regulatory burdens and improved economic performance in other jurisdictions without expanding government. Recent reforms in states such as Virginia demonstrate that meaningful reductions can be achieved with modest administrative resources. To estimate the potential gains from reform, the report models four scenarios in which Kentucky reduces regulatory restrictions by 10%, 20%, 30%, or 40% over a three-year period. In every case, economic growth increases. Annual GDP growth rises by an estimated 0.16 to 1.56 percentage points, depending on the scale of reform. Over time, these gains compound. By 2037, even limited reform would leave Kentucky’s economy about $4 billion larger than under the status quo, while more ambitious reductions could add up to $42 billion in economic output—roughly the equivalent of creating four to five bourbon industries from scratch. In short, Kentucky’s regulatory burden is not merely a constraint on growth but a lever for reform. Even modest reductions would yield substantial economic benefits, while deeper reforms could significantly strengthen the commonwealth’s competitiveness, innovation, and long-term prosperity. ## Introduction The Trump administration in Washington is focused on shrinking the size of the administrative state, but the regulations issued by federal bureaucracies are not the only rules that need re-sizing. In most states, regulations have been piling up for decades in parallel with the federal regulations, often without a systematic process for reviewing or removing outdated, duplicative, or unnecessarily burdensome rules. In Kentucky, the buildup of rules in recent years has been particularly pronounced. While Kentucky remains close to the median in terms of ranking across all states and D.C., the growth of regulations in Kentucky has double the growth rate of the median state since 2020\. This pattern reflects a broader phenomenon known as regulatory accumulation, in which new regulations are added more readily than old ones are revisited or removed. Over time this process leads to a steadily expanding stock of regulatory requirements, regardless of whether earlier rules remain effective or necessary. As a result of this accumulation, Kentucky has amassed, as of 2025, 126,891 regulatory restrictions. These restrictions are words and phrases such as “shall,” “must,” and “may not” that appear in the text of regulations and typically create prohibitions or obligations. On their own, those commands could fill a serious novel, before accounting for the context, definitions, exceptions, and guidance that surround them. The presence of so many restrictions has imposed a significant costs in time and resources on businesses and households alike, especially small and medium-sized enterprises and lower income households. But Kentucky’s outsized regulatory code also represents an opportunity for policymakers. Because so much regulatory accumulation has occurred, even targeted reforms have the potential to meaningfully boost the state’s economy. If Kentucky were to reduce its regulatory burden by 25% over the next three years, it could unlock significant economic potential. Experiences in other jurisdictions—including Idaho, Virginia, and the Canadian province of British Columbia—demonstrate that it is possible to reduce regulatory burdens systematically while maintaining core protections and improving economic performance. This report explores how Kentucky might realize such regulatory reform and estimates the potential gains Kentucky could experience from a targeted reduction of 10%, 20%, 30%, or 40% in regulatory red tape. Using data from State RegData and evidence from prior reform efforts, the analysis models how different reform scenarios would affect the state’s long-run economic growth. Across all scenarios examined, economic growth increases substantially. The estimated boost to growth ranges from 0.16 percentage point (pp) under a 10% reduction to 1.56 pp under a 40% reduction. Over time, these gains compound, translating into an increase in the size of Kentucky’s economy ranging from $4 to 42 billion by 2037. ## Kentucky’s Regulatory Burden Compared to Other States To understand the significance of Kentucky’s regulatory growth, it is useful to compare the state’s experience to that of other states. State RegData has annual data for nearly all 50 states from 2020 to 2024 as well as data for some of the states for 2025\. The project involves collecting all of the regulations in effect in each state at a specific point in time and using AI to quantify specific dimensions of those regulations. Primary among the metrics that State RegData produces is the popular *regulatory restrictions* metric. *Regulatory restrictions* is used in all the RegData datasets to serve as a proxy for the prohibitions (e.g., you may not do this) and obligations (e.g., you must do that) contained in regulatory text. Figure 1 shows the quantity of regulatory restrictions on the books for Kentucky for years 2020 to 2024\. Over that period, regulatory restrictions in Kentucky have grown by 8.8%, from 115,938 to 126,140\. Meanwhile, the median state’s regulations have increased 4.4% over the same time period—meaning Kentucky’s regulatory code has grown twice as fast as the median state between 2020 and 2024. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/02/fig1.png) By way of comparison, that rate of regulatory growth exceeds the national average, as the slope of the two lines in Figure 1 show. While Kentucky was less regulated than the median state in 2020 and 2021 and was the median state in 2022, Kentucky is now more regulated than the median state. As of 2024, Kentucky was 4% more regulated than the median state (Tennessee). The least regulated state, Idaho, had 27,800 restrictions in 2024\. By our measures, Kentucky is about 4.54 times more regulated than Idaho. To put the length of Kentucky’s regulatory code into more familiar context, the roughly 6.4 million words contained in the code is nearly eight times the length of the entire KJV Bible. At a brisk reading pace of 250 words per minute, it would require 50 of this year’s 60 day legislative session just to get through the text once. While it is not shown in the figure above, Kentucky’s regulations continued to grow in 2025, totaling 126,891 restrictions. While 2025 data is not yet available for all 50 states, the Kentucky region’s data for 2025 is complete—permitting a comparison with neighboring states. Kentucky ranks as the fourth most regulated state in the region, trailing only the much more populous states of Illinois, Ohio, and Virginia. On a per capita basis, Kentucky is the second most regulated state in the region. This is shown in Table 1\. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/02/table-1.png) ## Economic and Social Consequences of Regulatory Accumulation Regulatory accumulation refers to the steady and perhaps unintentional growth of regulations over time. Without a systematic approach to reviewing and removing outdated or redundant regulations, the steady buildup of government interventions eventually shows up in economic outcomes ranging from business activities such as investment decisions, startup rates, and productivity growth to household outcomes such as household income and consumer expenditure. ### Business and Investment Effects The downsides of regulatory accumulation are well documented. A landmark study published in 2020 showed that regulatory accumulation slows economic growth by nearly one percentage point annually. Specifically, the study found that the buildup of more and more federal regulations over time distorted business investment decisions, which, in the long run, are the drivers of innovation and productivity growth. Coffey et al. also found that the buildup of federal regulations has created a considerable drag on the economy, amounting to an average reduction of 0.8 percentage point in the annual growth rate of the US GDP. This seemingly small annual reduction has large implications. The slower economic growth associated with regulatory accumulation resulted in an economy that was $4 trillion smaller in 2012 than it could have been without such regulatory accumulation. That amount equaled about a quarter of the US economy in 2012, and if it were a nation’s GDP, it would have been the fourth largest in the world at that time. This translates to a loss in real income of approximately $13,000 per year for every American. A similar study estimated the effect to be even larger, finding that regulatory accumulation slowed US economic growth by as much as 2 percentage points annually. This sort of research shows that the total cost of regulations is greater than the sum of the projected compliance costs when each regulation is analyzed on its own. Forgone innovation, and the opportunity cost it implies, eventually makes compliance costs seem relatively trivial in comparison. Not coincidentally, research shows that regulatory accumulation disproportionately burdens small businesses—including the startups that are often the fountainheads of innovation—and that this burden grows at an increasing rate as regulation accumulates (i.e., the negative effect of each new regulation grows larger as the stock of regulation grows larger). ### Regulatory Complexity, Compliance, and Safety There are other reasons that business leaders should be concerned about regulatory accumulation. Scholarship from the fields of psychology, economics, and organizational science suggests that people are more likely to make mistakes and are less motivated and able to comply when they are required to follow too many rules simultaneously. For example, one study found that the growth in regulation in the nuclear power industry actually reduced safety. New regulations only distracted workers from their most important duties. In such circumstances, it became harder for workers to focus on averting the greatest risks, as an increasing share of their attention was diverted to recalling all the rules they were supposed to follow. Numerous other studies on safety regulations have reinforced these findings. Some 95% of Dutch railroad workers reported that they could not do their jobs if they followed all the rules. Similarly, British railroad workers admitted that more than half of all rule breaches were intentional, because they could not accomplish their jobs otherwise. And workers in the Australian mining industry became less concerned with evaluating situations of actual safety and more concerned with avoiding sanctions. The bottom line on regulations and workplace safety is that when too many regulations occupy their focus, workers can lose a sense of ownership of safety procedures, which has serious repercussions. Although their local knowledge allows workers to identify problems more easily than regulators, they become less motivated to find solutions. At best, workers focus on simply following the rules, even if they are not safety-enhancing. At worst, they focus on how to break the rules without getting caught. Reducing the complexity of the regulatory system is a powerful way to improve compliance and generate better outcomes from regulations that serve a justified purpose. ### Household Effects While regulation significantly affects business-related economic outcomes, regulation also has direct impact on American households, especially households with lower incomes. By creating barriers or hurdles that limit the ability of new individuals or companies to enter a market, regulatory accumulation can raise prices (through reduced competition), slow wage growth, and diminish economic opportunities for low-income workers. Regulation typically increases the production costs of goods, and these costs are passed on to the consumer in the form of higher prices. A study published in 2017 combined data from the Bureau of Labor Statistics, the Bureau of Economic Analysis, and the RegData database to study the relationship between prices and consumer choices. They found that a 10% increase in total regulation leads to a nearly 1% increase in consumer prices. Furthermore, they found that the effects of these price increases are regressive: The poorest income groups experience the highest proportional increases in the prices they pay. This is consistent with spending patterns broken down by income level. Low-income households tend to spend a greater portion of their incomes on necessities such as utilities, food, and healthcare; unfortunately, these goods also tend to be more regulated than other consumer and household goods. It is perhaps not surprising, then, that regulatory accumulation also has a positive statistical relationship with poverty rates; as regulation grows, poverty rates also tend to rise. Regulatory accumulation can also contribute to income inequality as wage growth shifts from low-income workers to compliance-related workers such as managers, lawyers, and accountants. ## Proven Strategies Reverse Regulatory Accumulation The good news is that there are proven ways to reverse the problem in Kentucky. Considering evidence on the harms of regulatory accumulation, several states have implemented regulatory reform initiatives designed to identify and weed out red tape that had accumulated over the years. The movement was arguably inspired by the Canadian province, British Columbia, which in 2001 recognized a need to cut some of the regulatory red tape that had built up over years. British Columbia’s groundbreaking red-tape reduction initiative succeeded in reducing the quantity of regulations on its books by about 40 percent within three years. Coffey and I found that the red-tape reduction caused the province’s economic growth rate to increase by over one percentage point, converting British Columbia from economic laggard to leader in just a few years. And the new, higher growth rate was maintained for several years thereafter. The states that have enacted successful regulatory reforms have primarily adopted two similar approaches: targeted red-tape reductions and regulatory budgets. The former—a targeted reduction—typically involves developing a quantitative measurement of accumulated regulation and then setting an explicit target for reduction, such as 25% or 30% relative to the initial baseline. The latter—regulatory budgeting—comes in a variety of forms, but it also typically requires first coming up with a quantitative metric of total regulatory burden and then tracking changes as new regulations are made or old regulations are modified or eliminated. These approaches are effective. The states of Idaho and Virginia offer instructive examples of successful regulatory reform in the United States. In 2016, Idaho was not the least regulated state in the nation. It required deliberate reform of the regulatory process, which has been a hallmark of Idaho Governor Brad Little’s time in office. Over the past several years, Idaho has implemented a bold regulatory reform agenda, resulting in a reduction of its regulatory restriction count by more than 50%. With one of his first executive orders, Governor Little implemented a one-in, two-out regulatory policy, requiring that for every new regulatory restriction introduced, two must be eliminated. This approach eventually evolved into a form of regulatory sunsetting called “zero-based regulation,” modeled after zero-based budgeting. Under zero-based budgeting, all state agencies must review all their regulations once every five years. If an agency wants to keep a rule on the books, the burden of proof is on the agency to show that the regulation is necessary and that the least restrictive alternative has been chosen. The results helped Idaho reduce its regulatory complexity and foster a more dynamic business environment, especially for small- and medium-size enterprises. And, not coincidentally, Idaho's economic growth outpaced national averages, and the state became a magnet for investment and entrepreneurship. More recently, the neighboring state of Virginia pioneered a slightly different approach to cutting red tape. Soon after taking office in 2022, Governor Glenn Youngkin directed Virginia agencies to pursue a sweeping reduction in regulatory burdens, setting a goal of eliminating one quarter of existing requirements by the end of his term. That benchmark has now been met. State officials expect the total reduction to reach roughly one-third of all regulatory requirements, alongside a 50% cut in the length of guidance documents, by the time the administration concludes. These results are not the product of accounting tricks or symbolic gestures. Virginia undertook a rigorous, ground-up inventory of its regulatory system, capturing not only formal rules but also incorporated third-party standards and agency guidance that carry regulatory force. Each modification has been carefully documented and publicly disclosed through the state’s regulatory town hall portal. The payoff from this effort has been substantial. To date, the reforms are estimated to save Virginians more than $1.2 billion annually. Those savings stem from a wide range of actions, including scaling back excessive licensing requirements—such as mandated training hours for cosmetologists—and simplifying rules that govern housing construction. In the housing context alone, regulatory streamlining is projected to reduce the cost of building a new home by about $24,000 while also accelerating project timelines for builders and contractors. Perhaps most striking is how modest the administrative footprint has been in Virginia. The Office of Regulatory Management, created to coordinate and enforce these reforms, operates with just four full-time staff members: a director, a deputy director, and two policy analysts. Looking ahead, advances in artificial intelligence are likely to further lower the cost of identifying, tracking, and evaluating regulatory requirements, making this kind of reform even more accessible to other states. ## Economic Gains from Cutting Red Tape ### Evidence from Prior Research A systematic reduction of regulatory burdens in Kentucky by 25% could result in significant economic gains. In our study of British Columbia’s regulatory reform, Coffey and I found that cutting red tape by 36% can boost GDP growth by roughly 1 percentage point annually. Such an increase in Kentucky’s growth rate would add billions to the economy each year. The effects would ripple throughout the economy, increasing household incomes, stimulating investment, and creating new jobs. However, the benefits would not be limited to increased GDP growth. Reducing regulatory complexity also encourages innovation by freeing up resources that businesses can reinvest in new technologies, research, and development. Moreover, reducing regulatory burdens could foster more competition, allowing smaller firms to enter the market, compete effectively, and contribute to job creation. In the ongoing competition between states to create the best business environment, Kentucky can become more appealing to businesses looking to escape the inhibitive tax and regulatory environments in other states. ### Simulations of Kentucky’s Growth Trajectory with Regulatory Reform To better understand the potential impact of regulatory reform in Kentucky, I modeled four scenarios where Kentucky reduces its regulatory restriction count: 10%, 20%, 30%, and 40%t reductions, all accomplished over the next three years. Each scenario incorporates different rates of additional annual growth owing to the reduction in regulatory red tape. The additional growth gained from each scenario is shown in Table 2 and described below. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/02/table-2.png) The various scenarios are a combination of the effects of red-tape reduction, and the outcomes of any regulatory reform—which is to say, the percentage of regulations that are cut under a hypothetical regulatory reform in Kentucky. The effects of the reduction are based on the research of Bentley Coffey and myself. Coffey and I estimate the effect of British Columbia’s red-tape reduction. In that study, the preferred estimate is 1.0 pp gained from a 36% reduction to regulations, and the high estimate is 1.4 pp gained from a 36% cut. Coffey et al. (2020) simulate the effect on the national economy if regulations were held constant at the level observed in the 1980, instead of growing to the level observed in 2012\. The difference is about a 50% reduction in regulations, which corresponds in their simulation to a 0.8 pp increase in growth. I use these estimates—1.4 pp, 1.0 pp, and 0.8 pp—to create projections of Kentucky’s economy in future years under different regulatory reduction outcomes. As a starting point, I collected economic growth rate data from the Bureau of Economic Analysis. Based on the average growth observed in Kentucky’s economy over the past decade (2013 to 2023), I assume a 1.64% compound annual growth rate (CAGR) in real GDP. This rate reflects the average historical growth rate observed over the past ten years. All projections for future years’ real GDP are therefore expressed in real 2017 dollars, adjusted for inflation, to ensure consistency and comparability across time. The regulatory reform outcomes I entertain are: no change to the regulatory process (baseline), a 10% reduction in total regulatory restrictions achieved at the end of three years, a 20% reduction after three years, a 30% reduction after three years, and a 40% reduction after three years. To calculate the effect of each of these reduction outcomes, I calculate the fraction of red-tape reduction achieved in the outcome being entertained relative to the reduction achieved in the relevant study and then multiply that fraction and the red-tape reduction boost for each scenario. For example, for the 30% reduction outcome, the high estimate, in which a 1.4 pp boost would be gained from a 36% red-tape reduction, the 1.4 pp growth boost is multiplied by (30/36), or 0.833, yielding a 1.4 x 0.833 = 1.167 pp increase in the growth rate. This is added to the baseline growth rate of 1.64%, yielding 2.81% growth in that scenario and red-tape reduction outcome. ### Projected Growth Effects Under Alternative Reform Scenarios Any of these scenarios would clearly increase the average growth rate in Kentucky. The boost to growth ranges from 0.16 pp (low effect, 10% reduction) to 1.56 pp (high effect, 40 percent reduction). But even for the low end of this range, the difference between the size of Kentucky’s economy after 10 years under a reform scenario versus the baseline scenario is significant. This is best shown in figure 3, which shows simulations of Kentucky state GDP through 2037\. These simulations assume that any red-tape reduction requires three years to be accomplished, after which the increase to the growth rate is realized and added to baseline GDP growth. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/02/figure-3.png) Again, the baseline scenario assumes a 1.64% growth rate. By 2037, at 1.64% growth, Kentucky state GDP would equal $285 billion (in real 2017 dollars). Using the central effect of a 1 pp increase for a 36% red-tape reduction, a modest 20% red-tape cut would make the economy $14 billion larger by 2037\. A 40% reduction would yield an economy that is over $20 billion larger by 2037\. Table 2 shows the full range of estimates of the difference between the baseline estimate of the economy’s size in 2037 and the alternative economy that would result from the regulatory reform outcome. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/02/table-3.png) As Table 2 shows, the high effect scenario with a 40% reduction would add nearly $42 billion dollars to the state’s economy by 2037. ## Conclusion Kentucky faces a critical opportunity to harness its economic potential by reducing regulatory burdens. As demonstrated by the experiences of British Columbia, systematic regulatory reform not only increases GDP growth but also fosters innovation, creates jobs, and enhances competitiveness. By adopting a regulatory reduction target over the next three years, Kentucky can unlock billions of dollars in additional economic output and position itself as a leader in business innovation and economic dynamism. The simulations presented here show that even modest cuts, such as 10%, could yield substantial benefits, while deeper reforms could transform Kentucky into an Appalachian hub for innovation, investment, and entrepreneurship. [Regulatory Reform in Kentucky: An Opportunity for Greater Economic Growth20260209\_RegReform\_Bluegrass.pdf663 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2026/02/20260209%5FRegReform%5FBluegrass-1.pdf "Download") --- *Patrick A. McLaughlin is a Research Fellow at the* [*Hoover Institution*](https://www.hoover.org/?ref=bluegrassinstitute.org) *at Stanford University and a Visiting Research Fellow at* [*Pacific Legal Foundation*](https://pacificlegal.org/?ref=bluegrassinstitute.org)*.* *The* [*Bluegrass Institute*](https://www.bluegrassinstitute.org/) *works with Kentuckians, pro-liberty coalitions, grassroots organizations and business owners to advance freedom and prosperity by promoting individual liberty, limited and transparent government, and free markets.* ### Louisville Is Making It Easier To Smoke Cigars Indoors URL: https://www.bluegrassinstitute.org/grier-louisville-cigars/ Last updated: 2026-02-06T17:01:38.000Z Bourbon and tobacco are two products practically synonymous with Kentucky. Pairing them indoors within the state's borders, however, is surprisingly difficult. Forty-four cities and counties throughout the state have implemented comprehensive indoor [smoking bans](https://breathe.uky.edu/tobacco-policy/smoke-free-communities/ordinance-database?ref=bluegrassinstitute.org). But a whiff of change is in the air: Last year, Louisville [passed](https://www.courier-journal.com/story/news/politics/2025/03/28/louisville-lifts-smoking-ban-cigar-bars/82656721007/?ref=bluegrassinstitute.org) an exemption for cigar bars, and a new bill in the legislature could [legalize them statewide](https://kentuckylantern.com/2026/01/28/ky-bill-paving-way-for-cigar-bars-decried-by-public-health-advocates-on-the-move/?ref=bluegrassinstitute.org). ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) Louisville's move is a rare example of government liberalizing smoking laws. Beginning in the 1970s and '80s with bans on smoking in workplaces and airplanes, such restrictions have tended to operate with a ratchet effect, tightening over time while almost never ceding ground back to smokers. In the 21st century, those bans expanded to include parks, sidewalks, beaches, golf courses, apartment balconies, public housing, and more, often without carve-outs for businesses catering to smokers. Until last year, Louisville offered few legal options for indoor smoking. After the city's first smoking ban was overturned for illegally [exempting](https://www.nytimes.com/2007/12/22/us/22brfs-LOUISVILLESM%5FBRF.html?ref=bluegrassinstitute.org) the Churchill Downs racetrack, a broader one [passed in 2008](https://www.cigaraficionado.com/article/louisville-bans-smoking-again-2997?ref=bluegrassinstitute.org). Since then, cigar smokers have crossed into neighboring Indiana for a warmer reception. That loss of business helped motivate the city's decision to [legalize](https://www.cigaraficionado.com/article/cigar-bars-finally-allowed-in-louisville?ref=bluegrassinstitute.org) cigar bars, requiring them to earn at least 15 percent of their revenue from tobacco products. A nearly identical bill has now [passed](https://kentuckylantern.com/2026/02/03/freedom-versus-public-health-kentucky-house-passes-cigar-bar-bill/?ref=bluegrassinstitute.org) in the state House, though it raises the tobacco revenue requirement to 25 percent. Kentucky does not have a statewide smoking ban, but if passed, the bill would preempt local prohibitions on cigar bars. Even in a state once [heavily reliant on tobacco farming](https://www.kentuckyliving.com/lifestyle/randy-londons-last-crop?ref=bluegrassinstitute.org), the proposal may be a tough sell. A similar bill passed the House and died in the Senate last year, and comparable bills elsewhere are rare. North Dakota is the lone outlier, [legalizing cigar bars in 2023](https://www.cigaraficionado.com/article/north-dakota-passes-bill-allowing-cigar-lounges?ref=bluegrassinstitute.org). In Wisconsin, a bill allowing licenses for new cigar bars passed last year but was [vetoed by Gov. Tony Evers](https://www.jsonline.com/story/news/politics/2025/12/05/tony-evers-vetoes-bill-aiming-to-allow-more-cigar-bars-in-wisconsin/87627521007/?ref=bluegrassinstitute.org). Opposition to such reforms typically focuses on secondhand smoke and fears of normalizing tobacco use. The former is a valid concern, even if the risks of environmental tobacco smoke have [often been overstated](https://slate.com/technology/2017/02/secondhand-smoke-isnt-as-bad-as-we-thought.html?ref=bluegrassinstitute.org). Still, the presence of risk alone does not justify barring adults from consenting to spend time in smoking establishments, whether as patrons, owners, or employees. And while few would want to return to an era when public smoking was unavoidable, steering clear of niche businesses like cigar bars is an easy ask for those who prefer smoke-free environments. Concerns about the normalization of cigar smoking are even less compelling. A [letter](https://kentuckylantern.com/2026/01/28/ky-bill-paving-way-for-cigar-bars-decried-by-public-health-advocates-on-the-move/?ref=bluegrassinstitute.org) from health organizations opposing the Kentucky bill claims the proposal "sends the wrong message to Kentucky's youth" and that "youth and young adults may perceive that it's socially acceptable to use cigars." But adults routinely engage in activities others would prefer young people not emulate—a point that should be obvious in a state famous for bourbon and horse betting. If anything, limiting the exemption to cigar bars could be criticized for not going far enough. Allowing only cigars (and pipes in the case of the Kentucky laws) can be described as elitist, favoring premium products while banishing smokers of cigarettes from social spaces. As [Barbara Ehrenriech observed in 2018](https://slate.com/news-and-politics/2018/04/barbara-ehrenreich-says-smoking-bans-are-a-war-on-the-working-class.html?ref=bluegrassinstitute.org), "As more affluent people gave up the habit, the war on smoking, which was always presented as an entirely benevolent effort, began to look like a war on the working class." At the other extreme, the logic breaks down entirely. Legalizing cigar bars while prohibiting indoor vaping is incoherent. Given the lower risks associated with e-cigarette vapor compared to smoke from burning tobacco, there is no reason for restricting the former more tightly than the latter. The preference of cigars over vapes and cigarettes has much more to do with regulatory inconsistency than with any objective weighing of their secondhand dangers. Imperfect as they may be, moderate rollbacks of smoking bans to legalize cigar bars are a rare counter to the broader trend toward harsher tobacco policies. From [flavor bans](https://www.tobaccofreekids.org/what-we-do/us/flavored-tobacco-products?ref=bluegrassinstitute.org) to[ smoke-free generation laws](https://www.nejm.org/doi/full/10.1056/NEJMp2403297?ref=bluegrassinstitute.org),[ regulation](https://reason.com/2022/04/02/welcome-to-the-nicotine-prohibition-era/?ref=bluegrassinstitute.org) is increasingly giving way to outright prohibition. The unintended consequences can be dire: [discouraging](https://reason.org/commentary/canada-banned-flavored-vapes-cigarette-sales-surged/?ref=bluegrassinstitute.org) smokers from transitioning to safer alternatives, [criminalizing](https://reason.com/2025/02/14/sell-flavored-tobacco-in-massachusetts-go-to-jail/?ref=bluegrassinstitute.org) sellers of forbidden products, and handing illicit markets to [violent](https://reason.com/2024/06/17/the-deadly-tobacco-drug-war-down-under/?ref=bluegrassinstitute.org)[ cartels](https://apnews.com/article/mexico-vaping-cartels-china-sheinbaum-organized-crime-1f8c5cdc2c180a2e909bf49ba499c295?ref=bluegrassinstitute.org). In that context, legalizing cigar bars is a small but welcome step toward policies that respect the liberties of consenting adults. Applied consistently, and contra the desires of public health advocates, liberalization would allow for more smoke-friendly spaces than exist today. By destigmatizing nicotine and tobacco use, it could also strengthen the case for [harm reduction](https://www.liberalcurrents.com/respecting-the-agency-of-smokers-the-liberalism-of-harms-reduction-and-the-illiberalism-of-prohibitionism/?ref=bluegrassinstitute.org), recognizing the rights of adults to access safer products that can render combusted tobacco largely obsolete. A nonprohibitionist approach to nicotine and tobacco can accommodate both. --- [*Jacob Grier*](https://reason.com/people/jacob-grier/?ref=bluegrassinstitute.org)*, a freelance writer in Portland, Oregon, is the author of several books, including* [The New Prohibition](https://www.amazon.com/New-Prohibition-Dangerous-Politics-Tobacco/dp/1734012536/?ref=bluegrassinstitute.org), [The Rediscovery of Tobacco](https://www.amazon.com/dp/173401251X?ref%5F=pe%5F3052080%5F397514860&ref=bluegrassinstitute.org)*, and* [Raising the Bar](https://www.amazon.com/Raising-Bar-Bottle-Bottle-Masterful/dp/1797210327/ref=sr%5F1%5F1?crid=5M4HYFSPWJPD&keywords=raising+the+bar+grier&qid=1669838447&sprefix=raising+the+bar+grie%2Caps%2C131&sr=8-1&ref=bluegrassinstitute.org) *(with Brett Adams). He is also a cofounder of the link-sharing platform* [*Seabird*](https://www.seabirdreader.com/?ref=bluegrassinstitute.org)*.* *This piece first appeared in* [*Reason Magazine*](https://reason.com/2026/02/05/louisville-just-made-it-easier-to-smoke-cigars-indoors/?ref=bluegrassinstitute.org)*.* ### Scholarship tax credits can help more Kentucky students succeed URL: https://www.bluegrassinstitute.org/scholarship-tax-credits/ Last updated: 2026-01-29T17:19:37.000Z Different families have different educational needs. Scholarship tax credits can help many struggling Kentucky students succeed. While the so-called One Big Beautiful Bill Act created the opportunity for these scholarships, each state must opt into the program each year. [House Bill 88](https://apps.legislature.ky.gov/record/26rs/hb88.html?ref=bluegrassinstitute.org) could begin Kentucky’s process for adopting a more-robust form of educational freedom for low-to-middle income families. Here are some upsides for families of a scholarship tax credit program that Kentucky lawmakers might adopt this year. ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) ### Empowering families through customization The "one-size-fits-all" model of education does not always align with a child’s specific learning needs. By providing scholarships that cover not just tuition, but also tutoring, specialized services for students with disabilities, and technology, the credits could allow parents to build a "customized" education. This flexibility can be especially transformative for families who otherwise would lack the financial means to seek supplemental support outside of the traditional classroom. ### Protecting the commonwealth’s budget A primary fiscal argument for the OBBBA credits is their "budget-neutral" nature for the state. Because the credits are applied against federal income tax liability, the funding comes from a redirection of federal dollars rather than the Kentucky General Fund. This allows the state to see an influx of educational investment - potentially millions of dollars - without diverting money away from existing state programs or the SEEK (Support Education Excellence in Kentucky) funding formula. ### Promoting healthy competition and innovation Proponents often suggest that when families have more choices, the entire educational ecosystem benefits. The presence of scholarship-funded options can encourage innovation in curriculum and teaching methods across both private and public sectors. Furthermore, because the federal law requires Scholarship Granting Organizations (SGOs) to serve at least 10 students across multiple schools and maintain a 90% spending rate on scholarships, the program is designed to drive resources directly into the hands of students rather than administrative overhead. ### Supporting public school students Contrary to the belief that these credits only benefit private schools, the OBBBA specifically allows scholarship funds to be used for public school expenses. This could include fees for "out-of-district" enrollment or supplemental services like after-school enrichment and exam prep. By including public school students as eligible recipients, the program can act as a bridge, providing extra resources to the most vulnerable students within the existing public system. ### Keeping Kentucky competitive With neighboring states like Indiana, Ohio, and West Virginia already implementing robust school choice and scholarship programs, supporters argue that Kentucky must opt-in to remain competitive. Providing these options can help the Commonwealth attract and retain families who prioritize educational freedom, ensuring that Kentucky’s workforce remains prepared for the demands of the modern economy. This modest change avoids those controversies, instead giving the children of low-to-middle income parents the best opportunities for education regardless of their schooling decisions. Public school students can get specialized tutoring, or supplies for school. Private school students can help offset tuition. And Kentucky keeps more of its money in-state, out of the hands and interference of bureaucrats in Washington. *Bluegrass Institute scholar Gary Houchens, Ph.D., is professor and director of the Educational Leadership Doctoral Program at Western Kentucky University.* ### KY's flawed property tax system allows silent increases URL: https://www.bluegrassinstitute.org/kys-flawed-property-tax-system-allows-silent-increases/ Last updated: 2026-06-18T17:19:15.000Z Homeowners across the commonwealth are waking up to shocking tax bills. In Louisville, property assessments jumped at least [30% in reassessed neighborhoods](https://www.courier-journal.com/story/news/local/2025/04/24/louisville-home-values-reassessed-in-2025-how-to-appeal/83234672007/?ref=bluegrassinstitute.org). Daviess County has seen six consecutive years of assessment increases [exceeding 5%](https://www.owensborotimes.com/news/2025/06/property-assessments-spike-again-increase-not-due-to-local-decisions/?ref=bluegrassinstitute.org). In Shelby County, where [activists fought](https://www.sctaxa.org/?ref=bluegrassinstitute.org) a property tax hike, school authorities handed themselves millions in new property tax revenue while simultaneously touting no change in tax rates. The enabler in all of these cases is a structural flaw in Kentucky's property tax system that allows silent tax increases to happen virtually automatically. In short, when home values rise, property taxes can soar even when rates stay flat or fall slightly. ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) Gov. Andy Beshear correctly highlights lower property tax rates of [10.6 cents per $100](https://revenue.ky.gov/Property/Pages/2025-State-Real-Property-Tax-Rate-Drops-to-10.6-cents.aspx?ref=bluegrassinstitute.org) of assessed value, touting that fact obscures some basic problematic math. A homeowner whose property value increased from $150,000 to $180,000 will pay more in taxes even if the rate drops from 11 cents to 10.6 cents. The math is simple: 10.6% of $180,000 is more than 11% of $150,000. **Kentucky should consider other property tax models** [Utah](https://propertytax.utah.gov/locally-assessed/residential/?ref=bluegrassinstitute.org) solved this problem 40 years ago with [Truth in Taxation](https://www.ntu.org/library/doclib/2025/07/Truth-in-Taxation-A-Solution-to-the-Growing-Property-Tax-Problem.pdf?ref=bluegrassinstitute.org) legislation. Before 1985, Utahns faced punishing property taxes and demanded relief. Rather than imposing rigid caps that would cripple local governments or merely shifting burdens, they created a system that combines transparency with accountability. Here's how it works: Each year, taxing authorities calculate the rate needed to generate the same revenue as the previous year based on new property values, known as "certified rate." This prevents the automatic revenue windfall that occurs when assessments climb. If local officials determine they need more revenue for schools, roads or public safety, they can still raise taxes — but only after ample public notice and buy-in. This process doesn't handcuff local government; it simply requires transparency and accountability to their constituents. Once among the highest-taxed states for property, Utah is now among the [lowest in the nation](https://taxfoundation.org/data/all/state/property-taxes-by-state-county/?ref=bluegrassinstitute.org). Kansas and Nebraska have followed Utah's lead in recent years, adopting their own Truth in Taxation laws to combat rising property tax burdens. Kentuckians should join them. **Kentucky’s property tax legislation falls behind** Kentucky's current system fails the transparency and accountability tests. State law allows local governments to [increase revenue up to 4%](https://revenue.ky.gov/Property/Pages/PropertyTaxRates.aspx?ref=bluegrassinstitute.org) without voter involvement. There's no requirement for individualized taxpayer notices and no dedicated hearing focused on property tax increases specifically. The 4% automatic increase allowance — which compounds year after year — enables substantial tax hikes over time without meaningful public input. Five years of a 4% increase is a nearly 22% hike for taxpayers. Truth in Taxation represents a transparent alternative that respects both taxpayers and local government autonomy. It acknowledges that local needs change and communities sometimes require additional revenue, but it ensures those decisions happen in the light of day with full public participation. Property tax relief matters to constituents. Lawmakers have taken up bills addressing senior exemptions and assessment freezes for elderly homeowners. But these piecemeal approaches only treat the symptoms. What Kentucky needs is comprehensive structural reform that prevents silent tax hikes. **Kentucky needs property tax reform** The political moment is now. Property taxes consistently rank as Americans' most hated tax. After years of surging home prices driven by [weak home construction](https://www.bluegrassinstitute.org/a-menu-of-options-for-kentucky-housing-reform-2026-2/), homeowners across Kentucky are feeling the squeeze. State legislators are clearly willing to tackle tax reform through income tax reductions implemented in recent years. Applying that same reform-minded approach to property taxes makes both political and policy sense. The legislation should eliminate the automatic 4% increase allowance that currently exists. While some gradual growth allowance might be reasonable to account for population increases or inflation, the current 4% threshold is too generous and defeats the purpose of requiring transparency. The choice is clear: Kentucky can continue down the path of silent tax increases, temporary relief measures and growing taxpayer frustration, or it can adopt Truth in Taxation and create a transparent, accountable property tax system that works for everyone. Decades of success in Utah suggests which path leads to better outcomes. It's time for the Kentucky General Assembly to bring truth to Kentucky's taxation. --- *Levi Anderson is a taxpayer advocate in Shelby County, KY.* *Caleb O. Brown is the CEO of the Bluegrass Institute.* *This piece first appeared in the* [*Louisville Courier Journal*](https://www.courier-journal.com/story/opinion/contributors/2026/01/24/kentucky-property-tax-system-increases-governor-beshear-general-assembly/87701825007/?ref=bluegrassinstitute.org)*.* ### Kentucky Needs Regulatory Transparency Now URL: https://www.bluegrassinstitute.org/regulatory-transparency-now/ Last updated: 2026-01-20T14:28:12.000Z Kentucky’s businesses and lawmakers are often operating in the dark when it comes to regulation. Regulation is the code that governs the most basic operations of Kentucky businesses. It sometimes exists in books that sit in drawers across multiple government boards and agencies. The [register](https://legislature.ky.gov/Law/kar/Pages/Registers.aspx?ref=bluegrassinstitute.org) has been posted online, but finding the complete and coherent set of rules that govern the voluntary sector of our economy is a substantial challenge. ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) Kentucky legislators trying to review agency rulemaking face a byzantine system where regulations are scattered, guidance documents remain hidden, and the cumulative burden on citizens and businesses is unmeasured. It’s at best grossly inefficient. At worst, it denies lawmakers the ability to engage in meaningful oversight and saps economic dynamism, putting Kentucky at a serious economic disadvantage. Kentucky needs a Regulatory Budget Office and a dramatic increase in regulatory transparency sooner than later. A neighboring commonwealth, Virginia, has already shown us a path forward. The [Virginia Regulatory Town Hall](https://townhall.virginia.gov/?ref=bluegrassinstitute.org) lists all new regulations and guidance document amendments while also cataloguing existing guidance, and the [Virginia Legislative Information System](https://law.lis.virginia.gov/?ref=bluegrassinstitute.org) provides the entire Virginia Administrative Code as currently enacted. Virginia's groundbreaking [Permit Transparency](https://permits.virginia.gov/?ref=bluegrassinstitute.org) platform provides a centralized system to track the daily status and timeline of critical steps in the permitting process, setting a new standard for regulatory transparency. Kentucky must follow suit—not just for permits, but for our entire regulatory framework. The separation of powers demands nothing less. When executive agencies create regulations with the force of law, our elected representatives must have the tools to provide meaningful oversight. Yet how can legislators evaluate whether a regulation serves the public interest when they can't easily access the full regulatory code or track how agencies interpret and enforce these rules through guidance documents? The information asymmetry tilts the balance of power dangerously toward the executive branch, allowing regulators to effectively legislate without key accountability. Virginia has already streamlined its regulatory burden by 35%, saving Virginians $1.4 billion annually. Creating a Regulatory Budget Office would create an opportunity for Kentucky to reap similar savings. Virginia’s success came not from blind deregulation, but from transparency that enabled informed decision-making about which rules provide value and which merely impose costs. For businesses, regulatory uncertainty is a growth killer. Companies need predictability to invest, expand, and create jobs. When regulations and their interpretations exist in shadows—accessible only to those with specialized knowledge or expensive consultants—small businesses suffer most. As one Virginia official noted, businesses require careful planning, and "it's impossible to plan if good information isn't readily available.” An online, searchable regulatory database would level the playing field. Entrepreneurs could understand their obligations before investing capital. Existing businesses could ensure compliance without guesswork. And when agencies issue guidance that effectively changes regulatory requirements, affected parties would know immediately rather than discovering violations after the fact. This isn't about eliminating necessary protections—it's about smart governance. Environmental safeguards, worker protections, and consumer safety rules serve vital purposes. But without transparency, we can't distinguish essential regulations from accumulated bureaucratic cruft that stifles innovation while providing minimal public benefit. Virginia literally wrote the book on state regulatory analysis, creating straightforward guides that any state could repurpose. These resources prove that effective regulatory review doesn't require an economics PhD—just commitment to transparency and systematic analysis. Kentucky could adapt these proven approaches while building our own comprehensive online platform. The benefits are manifold. Virginia's Department of Professional and Occupational Regulation reduced license processing times from 33 days to 5 days, while its Department of Environmental Quality cut permit processing times by 65%. These efficiency gains came from transparency that revealed bottlenecks and redundancies previously hidden in bureaucratic black boxes. Here in Kentucky, air permitting requirements can take as long as 255 days–it is difficult to believe processes like these can’t be improved. Kentucky can continue operating with an opaque regulatory system that empowers agencies, confuses businesses, and prevents effective oversight. Or the Commonwealth can join Virginia in saving taxpayers’ dollars while also giving entrepreneurs a fair shake from their own government. Our legislature should mandate the creation of a comprehensive online regulatory platform, including all administrative regulations, guidance documents, interpretive letters, and permit applications. This system should be searchable, regularly updated, and designed for both human users and AI analysis tools. The technology exists. The model works. Kentucky needs only the political will to bring our regulatory system into the light. Our businesses, taxpayers, and democratic institutions deserve nothing less. --- [*Caleb O. Brown*](https://www.bluegrassinstitute.org/author/calebobrown/) *is the CEO of the* [*Bluegrass Institute*](https://www.bluegrassinstitute.org/)*. Reeve T. Bull is the Director of* [*Virginia's Office of Regulatory Management*](https://www.orm.virginia.gov/?ref=bluegrassinstitute.org)*.* ### TIFs aren't improving Louisville as much as you think URL: https://www.bluegrassinstitute.org/tifs-arent-improving-louisville-as-much-as-you-think/ Last updated: 2026-01-13T20:06:56.000Z On Nov. 30, the Courier Journal [ran a story](https://www.courier-journal.com/story/news/local/2025/11/30/how-a-common-tax-incentive-aims-to-spur-development-in-louisville/86309912007/?ref=bluegrassinstitute.org) touting the successes of Louisville’s tax increment financing districts, or TIFs for short. According to the story, $50 million has been made available to and invested by various projects throughout the Louisville area over the last 20 to 25 years. To put this into perspective, using U.S. Bureau of Economic Analysis numbers, the cumulative output of the Louisville MSA economy over this time has been $1.3 trillion. Therefore, this investment amount has been a very small portion of the entire Louisville economy over this period. Additionally, as the article acknowledges and/or implies, many of the benefits have accrued to larger businesses rather than smaller ones and to neighborhoods already undergoing gentrification, such as [NuLu](https://www.courier-journal.com/story/news/local/2025/11/30/how-a-common-tax-incentive-aims-to-spur-development-in-louisville/86309912007/?ref=bluegrassinstitute.org#:~:text=Market%20Street%20in%20NuLu). As the piece points out, much research, including my own, shows that a lot of investment would have taken place anyway [without the incentives](https://www.courier-journal.com/story/news/local/2025/11/30/how-a-common-tax-incentive-aims-to-spur-development-in-louisville/86309912007/?ref=bluegrassinstitute.org#:~:text=And%20while%20many%20secure%20government%20approval%20with%20little%20resistance%2C%20TIFs%20can%20prove%20controversial%2C%20drawing%20criticism%20that%20such%20projects%2C%20which%20may%20have%20occurred%20even%20without%20the%20incentive%2C%20leave%20city%20coffers%20lighter%20than%20they%20would%20have%20been%20absent%20the%20subsidy). And as some economists would point out, if these projects are such good ideas, then why do they need the help of taxpayers? Why not let the marketplace alone determine the success or failure of these projects? **TIFs are a mixed bag** My research over the years, as well as those of others, shows that most TIFs have mixed results. Like I’ve learned from the research I have done on [enterprise zones](https://ir.library.louisville.edu/cgi/viewcontent.cgi?article=1787&context=etd&ref=bluegrassinstitute.org), Trump opportunity zones and other local economic development initiatives, usually [large corporations](https://1889institute.org/tax-increment-finance-districts-tifs/?ref=bluegrassinstitute.org) benefit the most, with some job creation and/or the retention of jobs supposedly about to leave the area. While the latter is definitely good news, many of these initiatives are also undertaken with the goal of revitalizing low-income and blighted neighborhoods, but this goal is usually not met. TIFs, like the old enterprise zone programs, are originally meant for neighborhood redevelopment. Those parts of “revitalization” programs which show the biggest success involve massive amounts of government infrastructure and public works spending, such as the expansion of the Louisville Airport in the 1990s to the amount of over [$700 million](https://www.auditor.ky.gov/Auditreports/Special%20Exams%20%20Performance%20Documents/Preliminary-Review-of-Improvements-Louisville-Inter.pdf?ref=bluegrassinstitute.org) in federal money. However, this came at the price of destroying a residential area adjacent to the airport in order to do the expansion. Despite this, when it came to jobs, this was one of the few bright spots of the old Louisville Enterprise Zone program. **Revitalizing Louisville will take more than TIFs** And then there are the [Hope VI](https://www.lmha1.org/about%5Flmha/mixed%5Ffinance%5Fproperties.php?ref=bluegrassinstitute.org) grants, some of which were used to rebuild public housing in the area east of downtown Louisville, as well as the Environmental Protection Agency permitting the development of Slugger Field, a site which had been declared a brownfield, to trigger the subsequent growth and “rebirth” of the East Market District (now called NuLu), Butchertown and Phoenix Hill neighborhoods. There is nothing inherently wrong with state and local governments trying to stimulate greater business and community reinvestment in certain areas of a municipality which need it. Evaluations of such programs, however, usually show that favorable outcomes are often skewed toward business and not residential interests. Also, tax breaks may make a difference, but targeted public works dollars seem to have a more dramatic impact. With deteriorating public infrastructure and underfunded mass transit systems in most urban areas throughout the U.S., it is not enough to rely upon tax breaks and cuts to stimulate local economic growth. More must be done outside of the private sector alone to bring back our cities. --- *Thomas E. Lambert has mostly taught economics, business statistics, public administration and public policy at various colleges and universities over the years such as the University of Louisville, Indiana University Southeast, and Northern Kentucky University*. *The views expressed in this op-ed piece do not necessarily reflect those of any institution for which he currently works or for which he has worked in the past.* *This piece originally appeared in the* [*Louisville Courier Journal*](https://www.courier-journal.com/story/opinion/contributors/2025/12/26/louisville-tifs-corporations-taxes-development/87677053007/?ref=bluegrassinstitute.org)*.* ### Trump Promotes Regulatory Relief—Not Subsidies—as the Solution to Obamacare URL: https://www.bluegrassinstitute.org/trump-promotes-regulatory-relief-not-subsidies-as-the-solution-to-obamacare/ Last updated: 2026-01-13T20:08:44.000Z ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) President Trump graciously [posted to Truth Social](https://truthsocial.com/@realDonaldTrump/posts/115877159371615050?ref=bluegrassinstitute.org) about what would provide relief from soaring Obamacare premiums—and what would not. [](https://substackcdn.com/image/fetch/$s%5F!dvK4!,f%5Fauto,q%5Fauto:good,fl%5Fprogressive:steep/https%3A%2F%2Fsubstack-post-media.s3.amazonaws.com%2Fpublic%2Fimages%2Ffa661f50-6b69-4dd6-bce6-09bb0f5cdd39%5F1290x2061.jpeg?ref=bluegrassinstitute.org) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/01/trump-obamacare-cannon.jpg) The post is broadly faithful to [comments](https://www.cato.org/multimedia/media-highlights-tv/michael-f-cannon-discusses-healthcare-costs-firsts-no-spin-news-bill?ref=bluegrassinstitute.org) I’ve made about how Congress and states should provide relief from Obamacare: - Don’t [renew any expired COVID-19-era subsidies](https://www.cato.org/blog/what-will-it-take-congress-admit-obamacare-has-failed?ref=bluegrassinstitute.org). - Don’t [convert Obamacare premium subsidies into cash subsidies](https://www.cato.org/commentary/obamacare-trump-already-showed-republicans-way?ref=bluegrassinstitute.org). - Make [universal and permanent](https://www.cato.org/briefing-paper/universal-permanent-health-insurance-relief?ref=bluegrassinstitute.org) the regulatory relief Trump provided in 2018 and President Obama provided in 2014. - Let [consumers](https://www.cato.org/blog/doge-recommendations-reform-tax-treatment-health-care?ref=bluegrassinstitute.org) [control](https://www.cato.org/outside-articles/would-medicare-all-mean-quality-all-how-public-option-principles-could-reverse?ref=bluegrassinstitute.org) the money. Hours after his Truth Social post, Trump [threatened to veto](https://www.newsweek.com/donald-trump-threatens-to-veto-obamacare-subsidies-bill-11343691?ref=bluegrassinstitute.org) a House-passed bill that would renew the expired Covid-era subsidies. In [my latest paper](https://www.cato.org/briefing-paper/universal-permanent-health-insurance-relief?ref=bluegrassinstitute.org), I explain that when Obamacare threatened access—like its [26 percent premium hikes](https://www.kff.org/quick-take/aca-insurers-are-raising-premiums-by-an-estimated-26-but-most-enrollees-could-see-sharper-increases-in-what-they-pay/?ref=bluegrassinstitute.org) do today—both Trump and Obama gave consumers regulatory relief by removing barriers to Obamacare-exempt plans. Trump, in the “[short term](https://www.wsj.com/opinion/how-trump-lowered-medical-premiums-and-expanded-choice-b750c458?ref=bluegrassinstitute.org)” market. Obama, by [exempting](https://www.cms.gov/cciio/resources/letters/downloads/letter-to-francis.pdf?ref=bluegrassinstitute.org) US territories from Obamacare’s costliest regulations. The Congressional Budget Office [found](https://www.cbo.gov/system/files/2019-01/54915-New%5FRules%5Ffor%5FAHPs%5FSTPs.pdf?ref=bluegrassinstitute.org) that Trump’s 2018 rule made comprehensive coverage available at premiums 60 percent below those of the cheapest Obamacare plans. The Obamacare-exempt plans often had “lower deductibles or wider provider networks.” Offering universal, permanent regulatory relief may not disrupt Obamacare as supporters fear. While Trump’s rule was in effect from 2018 to 2024, Obamacare premiums stabilized—spiking only after President Biden [revoked](https://www.cato.org/policy-analysis/biden-short-term-health-plans-rule-creates-gaps-coverage?ref=bluegrassinstitute.org) the Trump rule. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/01/cannon-figure-1.png) Meanwhile, enrollment grew. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2026/01/cannon-figure-2.png) States don’t need to wait for Congress. In Kentucky, Rep. Vanessa Grossl (R‑Georgetown) introduced [legislation](https://www.cato.org/blog/will-kentucky-take-lead-obamacare-relief?ref=bluegrassinstitute.org) that would immediately let residents access Obama’s 2014 relief by removing barriers to Obamacare-exempt plans available in US territories. [](https://substackcdn.com/image/fetch/$s%5F!1uYy!,f%5Fauto,q%5Fauto:good,fl%5Fprogressive:steep/https%3A%2F%2Fsubstack-post-media.s3.amazonaws.com%2Fpublic%2Fimages%2Fa2f98210-81bf-4280-9fac-14d432fec4f8%5F1400x1015.png?ref=bluegrassinstitute.org) --- [*Michael F. Cannon*](https://www.cato.org/people/michael-f-cannon?ref=bluegrassinstitute.org) *is Director of Health Policy Studies at the Cato Institute.* ### Evaluating Kentucky’s Assessment Results: Data, Omissions, and Governance URL: https://www.bluegrassinstitute.org/evaluating-kentuckys-assessment-results-data-omissions-and-governance/ Last updated: 2026-01-12T19:38:00.000Z The Kentucky Department of Education's December 2025 briefing omitted required statistical significance markers, excluded all racial subgroup data, and entirely failed to present legally mandated ACT results showing serious declines that contradict the improving state assessment narrative. The department's switch to the SAT appears to violate state law, severs Kentucky's only continuous 18-year high school trend line, and has no public record of state board approval. **Key Findings:** - **Legally required ACT results were entirely omitted and contradict the improving narrative.** The ACT—Kentucky's longest continuous assessment trend line (18 years)—was not presented to the board or public. ACT scores have seriously declined since 2016-17, contradicting improving KSA high school trends. - **The ACT-to-SAT switch appears to violate state law and destroys accountability.** The SAT lacks separate English and science sections required by KRS 158.6453, there's no public record of board approval, and it is difficult to not see this in light of the ACT’s inclusion of findings that are inconvenient to the Board. - **KDE’s presentation to the board was incomplete and misleading.** KDE's December 2025 briefing omitted required statistical significance markers on NAEP data and didn't discuss disaggregated results by race, limiting the board's ability to evaluate actual student performance. - **Kentucky's performance is generally lower than a decade ago.** When NAEP data are correctly analyzed over longer time periods, Kentucky students are performing worse than in 2013-2015 across multiple grades and subjects, despite recent KSA improvements. [Evaluating Kentucky’s Assessment Results: Data, Omissions, and GovernanceImportant concerns about assessment transparency, data, and major assessment decision-making.20260112KentuckysAssessmentResults.pdf5 MBdownload-circle](https://www.bluegrassinstitute.org/content/files/2026/01/20260112KentuckysAssessmentResults.pdf "Download") --- For more on this topic, consider reading Mr. Innes' commentary piece [*Kentucky’s Switch to the SAT Violates Public Trust; It May Also Violate State Law*](https://www.bluegrassinstitute.org/kentuckys-switch-to-the-sat-violates-public-trust-it-may-also-violate-state-law/). ### Trump tariffs expose Santa as a threat to American industry URL: https://www.bluegrassinstitute.org/trump-tariffs-expose-santa-as-a-threat-to-american-industry/ Last updated: 2025-12-30T18:21:42.000Z *Using Trumpian logic, Santa Claus is obviously taking advantage of us and harming the US economy.* --- Following in the footsteps of President Trump, I have a modest policy proposal that is extravagant in style and would hurt the economy — a petition to eliminate competition from Santa Claus through tariffs and other trade barriers. From a Trumpian perspective, Santa’s enterprise is clearly an unfair and harmful intrusion by a low-cost, high-quality foreign producer. Other policy analysts have reasonably focused on the [Scrooge-like implications of tariffs](https://www.courier-journal.com/story/opinion/contributors/2025/12/12/trump-tariffs-ky-cost-of-living-grocery-prices-healthcare/87601073007/?ref=bluegrassinstitute.org) for gift-giving at Christmas. Tariffs are a tax on foreign goods, so they increase prices as sellers pass along their higher costs to buyers. And tariffs are expressly designed to reduce competition from importers. It doesn't take a Ph.D. in econ to know that greater monopoly power is good for producers and bad for consumers, resulting in higher prices, decreased selection, lower quality and less pressure to please customers. Whatever the stated reasons for tariffs, we know that American producers are eager to restrict trade and reduce competition. To do this, they engage in trade with politicians who create concentrated benefits for them, while imposing diffuse and subtle costs on the general public through higher taxes, more debt or higher prices. Maybe it'd be better to put a tax on these trades between interest groups and politicians! **A case for protectionism against Santa** More broadly, [economists](https://ichthyoid.writeas.com/international-trade-basic-economics-by-thomas-sowell-ch?ref=bluegrassinstitute.org) are quick to note that tariffs, quotas, and other trade restrictions harm an economy by reducing voluntarily mutually beneficial trade, decreasing competition, relying less on producers specializing in their comparative advantages, inviting trade policy retaliation by other countries and so on. While trade restrictions are good for the protected producers and their politicians, none of this can reasonably be expected to foster economic growth. Of course, there may be other (non-economic) reasons to embrace tariffs in certain cases. For example, we wouldn't want to depend too much on foreign countries for weapons or computer chips. Or out of moral concern, we might decide not to buy things made in China by Uyghur slaves. Or we might impose sanctions on Iran or boycott oil from Russia to punish them. But such restrictions are never good for our economy. In such cases, we impose costs on ourselves, so that we can impose costs on others. We embrace these tools, despite the sacrifices, to address other policy concerns. Likewise, one could invoke these other arguments to make a case for protectionism against Santa Claus. Is he paying his elves well enough — or at all? Is he observing appropriate safety regulations and DEI quotas? Is he contributing to climate change? Or, following Trump, we could claim a ["national emergency"](https://www.nytimes.com/2025/02/02/us/politics/trump-tariffs-ieepa.html?ref=bluegrassinstitute.org) for toy manufacturers and retailers in America. But how great is the emergency, and is the sacrifice worth it? **Santa is undermining American industry** Until recently, trade restrictions were usually more popular in Congress, where special interest groups have greater sway with representatives of particular states and districts, given their narrower economic interests. But with the last three presidential administrations, we've seen a [marked increase](https://www.cato.org/regulation/fall-2022/bidens-protectionism-trumpism-human-face?ref=bluegrassinstitute.org) in protectionist views. First-term Trump made [increased tariffs](https://www.whitehouse.gov/articles/2025/04/tariffs-work-and-president-trumps-first-term-proves-it/?ref=bluegrassinstitute.org) a priority. [Biden continued](https://www.npr.org/2024/05/10/1250670539/biden-china-tariffs-electric-vehicles?ref=bluegrassinstitute.org) the same policies. And second-term Trump has noisily extended this approach. Biden treaded water on trade restrictions, but Trump is a true believer. Trump often talks about “improving” the trade deficit. But [his policies haven’t changed it](https://www.msn.com/en-us/money/markets/trumps-tariffs-were-supposed-to-cut-the-trade-deficit-and-boost-us-manufacturing-theyre-not-working/ar-AA1RVz61?ocid=BingNewsSerp&ref=bluegrassinstitute.org) — and it’s not really a problem anyway. Our trade deficit means that we import more than we export. But this is necessarily matched by an “investment surplus” — as foreigners use those extra dollars to invest more in us than we invest in them. This is the bulk of what economists call [“the balance of payments.”](https://en.wikipedia.org/wiki/Balance%5Fof%5Fpayments?ref=bluegrassinstitute.org) As such, fewer imports necessarily balance with reduced exports and decreased foreign investment in our economy. Again, none of this is good for economic growth. Short-term, it’s not surprising that a trade deficit won't be fixed by protectionism — even if it was a problem. And long-term, it's difficult to imagine how crutches and subsidies could lead to anything other than cultivating weakness, less exceptionalism, more cronyism and greater dependence on government. But using Trumpian logic, Santa is obviously taking advantage of us, undermining American industry, and harming our economy. We've existed peacefully with Santa for years, despite the insidious impact of his inexpensive products. Those days need to end if we're going to make America great again. --- [*D. Eric Schansberg*](https://www.bluegrassinstitute.org/author/eric-schansberg/) *is a professor of economics at IU Southeast in New Albany, IN, an adjunct scholar for the Indiana Policy Review, and the author of "College 101: What Students and Parents Should Know About Universities.*" *He is an economist with the* [*Bluegrass Institute*](https://www.bluegrassinstitute.org/author/eric-schansberg/)*.* *This piece first appeared in the* [*Louisville Courier-Journal*](https://www.courier-journal.com/story/opinion/contributors/2025/12/18/trump-tariffs-santa-claus-christmas-united-states/87716528007/?ref=bluegrassinstitute.org)*.* ### Kentucky’s Switch to the SAT Violates Public Trust; It May Also Violate State Law URL: https://www.bluegrassinstitute.org/kentuckys-switch-to-the-sat-violates-public-trust-it-may-also-violate-state-law/ Last updated: 2025-12-23T17:54:55.000Z Kentucky appears to be breaking its own education law. The Kentucky Education Reform Act of 1990 is meant to guarantee a stable, trustworthy assessment system for parents and lawmakers. Yet the state is now moving to dismantle the only reliable measure of high‑school performance it has ever had: the ACT. The alternative the education establishment has chosen does not meet Kentucky’s legal requirements. For nearly two decades, every Kentucky junior has taken the ACT. It is the sole long‑term trend line the state possesses, the one measure that has remained consistent through four different state‑assessment regimes. It has revealed something uncomfortable but important: since 2016‑17, Kentucky’s ACT scores in reading, math and science have declined. Over the past 33 years, Kentucky has struggled to maintain a dependable statewide testing program of its own. KIRIS, CATS and KPREP each came and went. The current Kentucky Summative Assessment (KSA) is only three years old and already shows signs of the same instability. Every time the system changes, Kentucky loses trend lines, transparency and the ability to measure progress over time. KERA was written to end exactly that kind of chaos—yet chaos is precisely what we have now. Kentucky’s KSA reports rising proficiency in reading, math and science—the very subjects where the ACT shows worsening results. Two tests that are supposed to measure similar skills should not tell opposite stories. When they do, parents deserve to know why. Instead of answering those questions, the [Kentucky Department of Education has decided to scrap the ACT entirely and switch to the SAT](https://www.bluegrassinstitute.org/testing-kentuckys-high-schoolers-dropping-act-shifting-to-sat-is-the-wrong-move/) beginning in 2026\. This is not a harmless administrative choice. It destroys the only continuous source of college‑readiness data Kentucky has, eliminates the one metric that cannot be curved or inflated by the state, and violates both the structure and the requirements of state law. Kentucky law is clear: the statewide college‑readiness exam must assess English, reading, mathematics and science. The SAT lacks a separate English section and includes no science component; it therefore does not satisfy KRS 158.6453\. A statewide exam that fails to meet statutory requirements cannot lawfully serve as Kentucky’s college‑readiness test. Yet KDE is moving ahead despite the conflict with the law, the loss of accountability, and the apparent lack of any visible approval from the Kentucky Board of Education. That last point matters. State statute places the Kentucky Board of Education in charge of the statewide assessment system. There is no record of a board vote to replace the ACT with the SAT, and it was KDE—not the board—that signed the SAT contract. If the shift was made administratively, it suggests a serious breakdown in how Kentucky’s education laws are being applied. Parents already face an assessment system that cannot provide consistent or comparable data. Now they are being asked to accept the removal of the one tool that has held steady for nearly 20 years. Legislators should not allow that to happen. The General Assembly has both the authority and the responsibility to intervene. Kentucky’s Supreme Court made clear in the *Rose* decision that the legislature is ultimately responsible for ensuring an efficient system of education. Four immediate steps lawmakers should take: 1. Restore the ACT as Kentucky’s statewide college‑readiness exam. 2. Reaffirm in statutethat the statewide exam must include separate assessments in English, reading, mathematics and science, exactly as KRS 158.6453 requires—thereby ruling out the SAT. 3. Require an open, public vote by the Kentucky Board of Education on any statewide‑assessment contract, in keeping with KERA’s governance structure. 4. Enact a stability provision that prevents KDE from constantly replacing statewide assessments before they can produce meaningful trend lines. Kentucky’s families deserve an assessment system that tells the truth about learning, not one that resets itself every few years and discards inconvenient data. If legislators want to uphold KERA and restore public trust, they must act now—before the state’s last remaining thread of real accountability is permanently cut. --- [*Richard G. Innes*](https://www.bluegrassinstitute.org/author/richard-innes/) *is an education policy analyst at the* [*Bluegrass Institute*](https://www.bluegrassinstitute.org/)*.* ### New federal tax credits can unlock Kentucky’s educational freedom URL: https://www.bluegrassinstitute.org/new-federal-tax-credits-can-unlock-kentuckys-educational-freedom/ Last updated: 2025-12-18T15:00:59.000Z As education freedom sweeps across the country, Kentucky stands out as an [unfortunate bulwark](https://www.bluegrassinstitute.org/testimony-to-the-budget-review-subcommittee-on-education/) against innovation, improved academic outcomes, and parental choice. For decades, Kentucky families have watched neighboring states take bold steps to expand educational opportunity while policymakers in Frankfort debate the same old questions. Ohio’s EdChoice program has improved college enrollment and graduation rates for thousands of students. West Virginia gave education savings account access to all K-12 students. In Indiana, families can take advantage of more than 100 public charter schools and Indiana’s Choice Scholarship Program. In just the past year, both Missouri and Tennessee expanded existing choice programs to allow more students to access scholarships. All the while, Kentucky has remained stagnant. Now, a new federal tax credit scholarship program offers a rare chance to leap forward — and it’s time for Kentucky to take it. At its heart, this program is simple: taxpayers can redirect a portion of what they owe the federal government to approved Scholarship Granting Organizations (SGOs), which in turn provide scholarships to students whose families fall within income eligibility limits — up to 300% of the area’s median income. In plain English, families who might not otherwise afford private or supplemental education can finally get the help they need. The genius of this approach is that it’s not a new education bureaucracy. It’s a tax program. The money never flows through Washington; instead, it stays in local communities, fueling innovation and giving parents real choices for their children. And because the tax credit is dollar-for-dollar, at least 90 percent of every contribution directly benefits a student — not an agency, not overhead, but a child. And the law is specifically crafted to allow children to participate in a variety of educational settings. For instance, a family with two children could apply for a scholarship to send one child to a private school and apply for another scholarship to cover tutoring costs for the other child remaining in public school. This tax credit gives parents the ability to customize learning for their families, rather than shoehorning kids into systems that don’t fit. If you think education choice is a partisan issue, think again. The last few years have shown that bipartisan cooperation is still possible and powerful. When Shaka [spoke](https://www.youtube.com/watch?v=EiHmlVQHKBE&ref=bluegrassinstitute.org) with North Carolina’s former Secretary of Health and Human Services, Kody Kinsley, he shared how his state’s leaders bridged political divides to expand Medicaid. Their success was built on four principles: clear priorities, transparent communication, shared values, and authentic engagement. Those same lessons apply here. Kentucky’s leaders should begin by focusing on the facts: this program does not draw from the state budget, and it benefits students in public and private schools alike. That’s the kind of win-win policy that transcends party lines. Lawmakers can be transparent about how funds are used, how families qualify, and how communities benefit. And by inviting parents to the table early, they can build trust and momentum for lasting reform. Kentucky stands at a crossroads. It can continue to debate yesterday’s talking points about who “owns” education, or it can follow the example of neighboring states where leaders have found common ground and put kids first. Families aren’t asking for handouts; they’re asking for the freedom to invest in their children’s future. That’s why polling shows that educational choice is no longer a fringe idea — it’s a mainstream demand. Across party lines, parents want flexibility, affordability, and accountability. The new federal tax credit scholarship program offers Kentucky a bipartisan, budget-neutral, and family-centered path forward. It’s not about ideology. It’s about opportunity. The time to act is now, before another generation of students is forced to wait for adults to put politics aside in favor of putting kids first. [*Shaka Mitchell*](https://www.federationforchildren.org/staff/shaka-mitchell/?ref=bluegrassinstitute.org) *is a senior fellow for the American Federation for Children.* [*Gary Houchens*](https://www.bluegrassinstitute.org/author/gary-houchens/) *is a scholar at the Bluegrass Institute and a former member of the Kentucky Board of Education.* *This piece* [*first appeared*](https://www.kentucky.com/opinion/op-ed/article313776076.html?ref=bluegrassinstitute.org#storylink=cpy) *in the* Lexington Herald-Leader*.* ### Video: Making Room for the Next Generation of Kentuckians URL: https://www.bluegrassinstitute.org/video-making-room-for-the-next-generation-of-kentuckians/ Last updated: 2025-12-17T17:54:27.000Z Kentucky is in the early stages of a housing affordability crisis—and we can either learn from California's catastrophic failures or chart a better course. [M. Nolan Gray](https://www.bluegrassinstitute.org/author/mnolangray/), senior director of California YIMBY and Bluegrass Institute scholar, returned to his native Kentucky in October to speak to an audience in Louisville about how to keep the American dream of homeownership alive. In November, he followed this up with the release of his Bluegrass Institute policy brief, [*A Menu of Options for Kentucky Housing Reform 2026*](https://www.bluegrassinstitute.org/a-menu-of-options-for-kentucky-housing-reform-2026-2/). In Lexington, the median home price has climbed from 2.8 times median household income in the early 1990s to over five times median income today. A starter home that sold for $68,000 then would cost over $325,000 now. Bowling Green shows similar pressures. Louisville faces some of the highest rent burdens in the country. And Kentucky is building far fewer homes than peer states like Tennessee and North Carolina—states maintaining affordability by allowing construction to keep pace with demand. ### Kentucky's Path Forward The good news: we know what works, and the [Kentucky Housing Task Force recently embraced many of these solutions](https://www.bluegrassinstitute.org/bluegrass-institute-commends-kentucky-housing-task-force-for-embracing-key-reform-recommendations/). The Task Force's final report aligns closely with Bluegrass Institute recommendations on key reforms: - **Streamlined permitting** with "shot clock" deadlines and third-party reviews - **Property owner protections** against arbitrary mid-process rule changes - **Density reforms** including reduced lot sizes and legalized small multifamily housing - **Cost-cutting building code changes** like single-staircase allowances - **Reduced parking mandates** that add $10,000-$50,000 per unit - **Support for faith-based housing** without undue zoning barriers These aren't theoretical solutions. Texas legalized townhouses in Houston in the late 1990s, resulting in over 100,000 units built while maintaining affordability despite absorbing a quarter-million new residents. Florida's Live Local Act allowed housing on struggling commercial properties, triggering an immediate building boom. California's 2017 accessory dwelling unit reforms produced over 100,000 new units. ### What's at Stake This isn't abstract policy. It's whether the Kentucky dream remains accessible. Can a young automotive engineer and healthcare worker buy a home and build a life here? Can adult children afford to stay near aging parents? Can someone retire without leaving their community? In polarized times, housing affordability cuts across partisan lines. Utah approaches it from a families perspective. Montana focuses on property rights. Connecticut addresses segregation. As the Task Force's work demonstrates, Kentucky has an opportunity to lead. Our peer states are already implementing these reforms. The question is whether Kentucky will preserve the affordability that has always been central to the Commonwealth's appeal—or follow California's path toward stratospheric prices and mass displacement. The choice is ours, and the time to act is now. --- *Learn more about the* [*Bluegrass Institute's housing reform agenda*](https://www.bluegrassinstitute.org/a-menu-of-options-for-kentucky-housing-reform-2026-2/)*.* ### Congress must fix hemp ban that threatens Kentucky farmers URL: https://www.bluegrassinstitute.org/congress-must-fix-hemp-ban-that-threatens-kentucky-farmers/ Last updated: 2025-12-11T13:03:15.000Z Recently, Congress passed emergency legislation to reopen the federal government. Deep within that bill was a drastic policy change that threatens to wipe out Kentucky’s legal hemp industry. The provision was included in a must-pass spending bill and became law. The new law will limit the amount of tetrahydrocannabinol, or THC, to just 0.4 milligrams per container in any hemp product. Right now, hemp products are allowed to contain a tiny trace of THC as long as it stays under 0.3% by dry weight. That has been the federal standard since 2018. The new law will treat safe, well-made CBD products the same as unregulated, potentially risky synthetics that were never meant to be legal. Right now, products like Delta-8 or THCa, which are lab-made forms of THC, are being sold with no testing, no labeling, and no age limits. Many are imported and made in unregulated labs. This law does not address the real issue: the lack of enforcement against unsafe synthetic knockoffs. Instead, it would punish legal hemp businesses, including Kentucky farmers, who are a vital part of the agricultural economy and not the source of the problem. According to the Courier Journal, only 2.5% of Kentucky’s current hemp acreage would remain legal under the new federal restriction. That means 97.5% of the industry would be shut down, despite years of compliance with federal and state law. Kentucky’s hemp sector has become a national model, built on bipartisan cooperation and guided by regulatory oversight from the Department of Agriculture. This provision puts all of that at risk. Kentucky federal delegates from both parties have recognized the concern. They’ve warned that the provision threatens to destroy years of progress. Thousands of legal businesses, jobs, and investments are now exposed to immediate risk, as is the public’s access to products they’ve grown to trust and rely on over the years, without having to turn to unnecessary medical interventions or prescription drugs. One of the fastest-growing areas of these safe and natural hemp products is providing relief to pets who suffer from anxiety. Consumers stand to lose access to all of these products. The law allows for a 364-day grace period, which was included in this provision. If the provision stands, it currently offers no relief for farmers with loans, equipment leases, or investor-backed production lines. Further, there is no compensation for lost crops or unsellable inventory. Many small operators will be left with debt they cannot repay. At the same time, marijuana is now legal in more than 30 states, but still illegal under federal law. Kentucky legalized medical cannabis in 2023\. That law allows cannabis flower with up to 35% THC, with concentrates up to 70%. This is a stark and inexplicable policy contrast and inconsistency. Congress did not address the real source of harm. Instead, it hurts small farmers, processors, and family-run companies who followed the law. There’s still time to reverse the course. The future of Kentucky’s hemp economy is at stake. --- *Jimmy Higdon is a Kentucky State Senator representing the 14th district.* ### Bluegrass Institute Commends Kentucky Housing Task Force for Embracing Key Reform Recommendations URL: https://www.bluegrassinstitute.org/bluegrass-institute-commends-kentucky-housing-task-force-for-embracing-key-reform-recommendations/ Last updated: 2025-12-08T21:58:45.000Z Educate your inbox with the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) **FOR IMMEDIATE RELEASE** **December 8, 2025** Frankfort, KY — The Bluegrass Institute today congratulated the Kentucky Housing Task Force for advancing a slate of housing reform measures that [closely mirror recommendations advanced by the Institute earlier this year](https://www.bluegrassinstitute.org/a-menu-of-options-for-kentucky-housing-reform-2026-2/). The Task Force’s [final report](https://apps.legislature.ky.gov/CommitteeDocuments/395/37915/Nov%2024%202025%20Report%20and%20Recommendations%20of%20the%202025%20Kentucky%20Housing%20Task%20Force%20%28Final%29.pdf?ref=bluegrassinstitute.org) demonstrates a strong commitment to lowering housing costs, expanding supply, and protecting property rights across the commonwealth. Among the most notable areas of alignment: - **Streamlined Permitting:** Both the Task Force and the Institute call for “shot clock” deadlines and third‑party reviews to reduce costly delays. - **Property Owner Protections:** Recommendations secure zoning rights at the time of application, preventing sudden downzoning or regulatory changes. - **Density & Land Use Reform:** Shared proposals include reducing minimum lot sizes, easing setback requirements, and legalizing small multifamily housing. - **Cost‑Cutting Building Code Changes:** Both endorse reforms such as single‑staircase allowances in multi‑family housing to lower construction costs. - **Parking Requirement Reductions:** Eliminating or reducing mandatory off‑street parking minimums to maximize land use efficiency. - **Faith‑Based and Charitable Housing Initiatives:** Supporting religious and nonprofit organizations in building housing without undue zoning barriers. The institute encourages lawmakers to adopt solutions that **avoid government subsidies** and other handouts that will unduly burden taxpayers and decrease affordability in the long run. Instead, lawmakers should work to enhance property rights, cut red tape, and give property owners greater control over the creation of new housing. Bluegrass Institute scholar and one of the report’s authors, [**M.** **Nolan Gray**](https://www.bluegrassinstitute.org/author/mnolangray), noted “If we're going to make room for the next generation of Kentuckians, the state has to scale up housing production. This package of reform of best practices will do just that.” [The Bluegrass Institute](https://www.bluegrassinstitute.org/) looks forward to working with lawmakers and stakeholders during the 2026 Regular Session to ensure these reforms are enacted, helping Kentucky remain competitive and ensuring that housing is abundant and affordable for generations to come. **Contact:** **Joseph Verruni** [**jlv@bluegrassinstitute.org**](mailto:jlv@bluegrassinstitute.org) **Bluegrass Institute** ### Hemp ban in funding bill rips the rug out from under U.S. farmers URL: https://www.bluegrassinstitute.org/hemp-ban-in-funding-bill-rips-the-rug-out-from-under-u-s-farmers/ Last updated: 2025-12-04T13:02:51.000Z The funding bill to end the longest government shutdown in American history was not simply a “yes” or “no” to reopen the government. Tucked away in the bill, on page 163, in Title VII of Division B, was a provision to shut down the hemp industry. It wipes out the regulatory frameworks adopted by several states, takes away consumer choice and destroys the livelihoods of hemp farmers. This could not come at a worse time for our farmers. Costs have increased while prices for crops have declined. Farm bankruptcies are rising. For many farmers, planting hemp offered them a lifeline. Hemp can be used for textiles, rope, insulation, composite wood, paper, grain and in CBD products, and growing hemp helped farmers to mitigate the loses they’ve endured during this season of hardship. But that lifeline is about to be extinguished. ### Nearly 100% of hemp products currently sold will be illegal The [justification](https://www.courier-journal.com/story/opinion/contributors/2025/07/17/mcconnell-hemp-kentucky-kids-thc-candy-poison-farmers/85243371007/?ref=bluegrassinstitute.org) for this hemp ban, we are told, is that some bad actors are skirting the legal limits by enhancing the concentrations of THC in their products. The hemp industry and I had already come to the negotiating table, in good faith, to discuss reforms that prevent “juicing up” hemp products with purely synthetic cannabinoids of unknown origin. Dozens of states have already instituted age limits and set THC levels for such products. I have no objection to many of these reforms. In fact, during negotiations, I expressly stated I would accept a federal ban on synthetic THC, as well as reasonable per serving limits. All along, my objective was to find an agreement that would protect consumers from bad actors while still allowing the hemp industry to thrive. But the provision that was inserted into the government funding bill makes illegal any hemp product that contains more than 0.4 milligrams of THC per container. That would be nearly 100% of hemp products currently sold. This is so low that it takes away any of the benefit of the current products intended to manage pain or other conditions. ### Hemp products — and plants — are being targeted There is no reason to wipe out the progress made by states that have been regulating hemp since it was legalized. Of the 23 states that expressly permit the sale of hemp THC food and beverages, not one of them has set a limit lower than the 0.4 milligram limit established by the bill. For example, Kentucky, along with Minnesota, Utah and Louisiana, limits THC to 5 milligrams per serving. Alabama and Georgia allow 10 milligrams per serving. Tennessee allows 15 milligrams per serving. Maine allows 3 milligrams per serving. These state laws will be preempted and wiped out by this new federal 0.4 milligram restriction. For reference, the illegal “juiced up” synthetic products that this funding bill is supposedly targeting are around 50 to 100 milligrams. Hemp products aren’t the only things being targeted — it’s also the hemp plants themselves. The bill changes the current Farm Bill definition of hemp plants from .3 delta-9 THC to .3 *total* THC. In other words, crops already in the ground would be declared illegal. This rips the rug out from under American farmers, whose investments will be stripped away from them. ### I will not stop advocating for hemp farmers and consumers In true Washington swamp fashion, this hemp ban is not being debated on its own, on the merits. Instead, it is attached to a must-pass bill. Once again, Congress created a crisis, then conveniently used the crisis to jam through new laws without debate. Anyone that asks for a debate when these “reforms” emerge from behind closed doors is accused of obstruction by Congressional leaders. I was able to force a vote in the Senate to remove the hemp ban, and while this effort was not successful on the first attempt, it will not be the last word. As farmers are forced to destroy their crops, consumers see empty shelves where their favorite products once sat and black markets emerge and thrive, the issue will not go away. And I will not stop advocating for farmers and consumers being targeted by a few members of Congress. --- *Rand Paul is a United States senator from Kentucky and the author of "The Case Against Socialism."* ### What the NAEP Proficient Score Really Means for Learning URL: https://www.bluegrassinstitute.org/what-the-naep-proficient-score-really-means-for-learning/ Last updated: 2025-12-01T16:16:35.000Z In September, The 74 published [Robert Pondiscio’s opinion piece](https://www.the74million.org/article/tylenol-autism-and-the-perils-of-basic-level-literacy/?ref=bluegrassinstitute.org) discussing how people without strong reading skills lack what it takes “to effectively weigh competing claims” and “can’t reconcile conflicts, judge evidence or detect bias.” He adds, “They may read the words, but they can’t test the arguments.” To make his case, Pondiscio relies on the skill level needed to achieve a proficient score or better on National Assessment of Educational Progress, a level that only [30% of tested students](https://www.the74million.org/article/new-naep-scores-dash-hope-of-post-covid-learning-recovery/?ref=bluegrassinstitute.org) reached on 2024’s Grade 8 reading exam. Only 16% of Black students and 19% of Hispanics were proficient or more. Yet naysayers argue that the NAEP standard is simply set too high and that NAEP’s sobering messages are inaccurate. There is no crisis, according to these naysayers. So, who is right? Well, [research on testing performance](https://www.bluegrassinstitute.org/content/files/2025/10/Is-NAEP-s--Proficient-or-Above---Achievement-Level-Valid-naepOct22.pdf) of eighth graders from Kentucky indicates that it’s Pondiscio, not the naysayers, who has the right message about the NAEP proficiency score. And, Kentucky’s data show this holds true not just for NAEP reading, but for NAEP math, as well. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/12/neap.png) Source: The Bluegrass Institute’s report “Is NAEP’s ‘Proficient or Above’ Achievement Level Valid?” Kentucky offered a unique study opportunity. Starting in 2006, the Bluegrass State began testing all students in several grades with exams developed by the ACT, Inc. These tests include the ACT college entrance exam, which was administered to all 11th grade public school students, and the EXPLORE test, which was given to all of Kentucky’s public school eighth graders. Both the ACT and EXPLORE featured something unusual: “Readiness Benchmark” scores which ACT, Inc. developed by comparing its test scores to actual college freshman grades years later. Students reaching the benchmark scores for reading or math had at least a 75% chance to later earn a “C” or better in related college freshman courses. So, how did the comparisons between Kentucky’s benchmark score performance and the NAEP work out? Analysis found close agreement between the NAEP proficiency rates and the share of the same cohorts of students reaching EXPLORE’s readiness benchmarks. ​ For example, in Grade 8 reading, EXPLORE benchmark performance and NAEP proficiency rates for the same cohorts of students never varied by more than four percentage points for testing in 2008-09, 2010-11, 2012-13 or 2014-15. The same, close agreement was found in the comparison of NAEP grade 8 math proficiency rates to the EXPLORE math benchmark percentages. EXPLORE to NAEP results were also examined separately for white, Black and learning-disabled students. Regardless of the student group, the EXPLORE’s readiness benchmark percentages and NAEP’s proficient or above statistics agreed closely. Doing an analysis with Kentucky’s ACT college entrance results test was a bit more challenging because NAEP doesn’t provide state test data for high school grades. However, it is possible to compare each student cohort’s Grade 8 NAEP performance to that cohort’s ACT benchmark score results posted four years later when they graduated from high school. Data for graduating classes in 2017, 2019 and 2021 uniformly show close agreement for overall average scores, as well as for separate student group scores. It’s worth noting that all NAEP scores have statistical sampling errors. After those plus and minus errors are considered, the agreements between the NAEP and the EXPLORE and ACT test results look even better. The bottom line is: Close agreement between NAEP proficiency rates and ACT benchmark score results for Kentucky suggests that NAEP proficiency levels are highly relevant indicators of critical educational performance. ​Those claiming NAEP’s proficiency standard is set too high are incorrect. That leaves us with the realization that overall performance of public school students in Kentucky and nationwide is very concerning. Many students do not have the reading and math skills needed to navigate modern life. Instead of simply rejecting the troubling results of the latest round of NAEP, education leaders need to double down on building key skills among all students. --- *This piece was* [*originally published in* The 74.](https://www.the74million.org/article/what-the-naep-proficient-score-really-means-for-learning/?ref=bluegrassinstitute.org) ### The Free Market Case for Property Taxes URL: https://www.bluegrassinstitute.org/the-free-market-case-for-property-taxes/ Last updated: 2025-12-01T21:53:37.000Z Americans have been paying property taxes since the colonial era—and complaining about them for just as long. It’s about as American as you can get. (The paying and the complaining.) These days, the complaints are getting louder, with calls for abolition. The objections are understandable: far too often, local government officials have failed to reduce rates as assessed values have skyrocketed, yielding large unlegislated tax increases. Reforms are warranted. But repeal? It may be asking too much for most people to *like* property taxes, but all policy choices involve trade-offs, and for those who care about economic efficiency, neutrality, decentralization, and government accountability, the property tax deserves to be rated highly, if not in absolute terms, at least relative to the alternatives. Spending restraint can reduce property tax burdens. But with property taxes accounting for 70 percent of local tax collections nationwide and upwards of 90 percent in some states, any discussion of property tax elimination must grapple with revenue alternatives. ![man in black shirt sitting on chair near white wooden house during daytime](https://images.unsplash.com/photo-1628133287836-40bd5453bed1?crop=entropy&cs=tinysrgb&fit=max&fm=jpg&ixid=M3wzMDAzMzh8MHwxfHNlYXJjaHw1Mnx8aG91c2V8ZW58MHx8fHwxNzYxNjU0NjU4fDA&ixlib=rb-4.1.0&q=80&w=1080 "man in black shirt sitting on chair near white wooden house during daytime") Photo by [Ian MacDonald](https://unsplash.com/@imacdonald3?ref=bluegrassinstitute.org) on [Unsplash](https://unsplash.com/?ref=bluegrassinstitute.org) Economic research consistently finds that property taxes are less economically harmful than other major taxes. A study of taxes across 21 OECD countries [found](https://academic.oup.com/ej/article-abstract/121/550/F59/5079707?ref=bluegrassinstitute.org) that a 1 percentage point shift from income taxes to consumption taxes (like sales taxes) improves GDP by 0.74 percent, while shifting to property taxes increases GDP by 1.45 percent. An International Monetary Fund paper [concluded](https://www.imf.org/external/pubs/ft/wp/2012/wp12257.pdf?ref=bluegrassinstitute.org) that a 1 percentage point shift from income to consumption taxes drove a 0.92 percent GDP increase, while shifting to taxes on real property grew GDP by a full 2.47 percent. When it comes to economic growth, consumption taxes are better than income taxes, but property taxes are better still. This is true, at least in part, because property taxes are more economically neutral than most alternatives. They have less of an effect on decision-making. It is axiomatic that whatever you tax, you get less of. Taxing income means less income-producing labor and investment, for instance. But because land is an immobile asset, taxing property does less to distort market decisions than taxing income or even sales. Even where improvements are concerned, research suggests that property taxes do relatively little to distort economic decision-making, since (unlike income or sales taxes) the tax does not penalize productivity or consumption. Of the major taxes, moreover, property taxes hew closest to the “benefit test,” under which taxes correspond—if imperfectly—to services received. No one would mistake property taxes for a pure user fee, but the value of one’s property is a reasonable proxy for the benefits received from local services, like roads, law enforcement, emergency services, and schools. Just as insurance premiums are higher for more valuable properties, property taxes are proportionally higher for more expensive parcels. Because property taxes are local and closely tied to the public services that shape property values, they allow residents to better judge whether tax levels match the value they place on local spending and to hold officials accountable when they do not. It’s also highly transparent: people know their property tax bill but have no idea what they pay in sales tax. Transparency contributes to the property tax’s unpopularity, but it’s a feature, not a bug: people *should* know and be able to act upon their tax burden! In Florida, where Gov. Ron DeSantis is championing property tax elimination, replacing the property tax would require a 15.3 percent statewide sales tax. Alternatively, if counties replaced the revenue themselves, sales tax rates would range from 9.8 to 32.5 percent. Other states would see similarly eye-popping [replacement tax rates](https://taxfoundation.org/research/all/state/property-tax-repeal-replace-revenue/?ref=bluegrassinstitute.org). Replacing the property tax with newly granted local taxing authority is exceedingly difficult, because local sales and income tax bases vary widely across jurisdictions. There may be no feasible sales tax rate by which an agricultural county or bedroom community could replace its property tax revenue. State-level backfilling, however, isn’t much better. If the state assumes responsibility for replacing local revenue, lawmakers must decide whether to replace revenues at existing levels—permanently rewarding jurisdictions that previously imposed higher rates—or to use some other formula for revenue distribution, thereby inducing dramatic revenue swings that local governments would have no authority to offset. Even if the state undertakes full revenue replacement, moreover, lawmakers must figure out how to adjust in future years, since there will not be new assessments on which to base the transfers. Under state-level replacement, localities lose any incentive to economize below their guaranteed level of funding. The loss of local autonomy hurts taxpayers. Currently, high-tax jurisdictions must justify those higher taxes, but under a system of full state backfill, they would receive the same amount regardless of what services they deliver or how well they deliver them. Furthermore, while lawmakers can build population adjustments into allocation formulas, these cannot fully account for increased investment into a community, which creates new expenditures. A new business or housing development brings more costs (schools, roads, public services) but little or no new tax revenue to cover them. Consequently, the smart strategy for a local official with a guaranteed revenue stream trying to stay within budget could be to avoid growth altogether, to block new construction, discourage business expansion, or make it harder for new residents to move in. Property tax critics advance numerous arguments against the tax—and some of them are compelling. All taxes have their own set of downsides. One common objection is to the notion of perpetual payments on something one owns. But income taxes fall on the exercise of our ownership of our own labor, and at a philosophical level, one might equally ask why we’d be taxed on what we consume. If looking for a tiebreaker, one could do worse than the fact that property taxes are so much more conducive to economic growth. Functionally, moreover, the tax is for ongoing services to property—services that don’t cease to be provided once a mortgage is paid off. Is the property tax perfect? Far from it. But compared with any realistic alternative, it’s better for economic growth, it better aligns with benefits received, and it avoids the perverse incentives and principal-agent problems raised by any state offset. Lawmakers should consider [responsible mechanisms](https://taxfoundation.org/research/all/state/property-tax-relief-reform-options/?ref=bluegrassinstitute.org) to arrest the rapid growth of property tax burdens, but they should stop well short of abolition. Against the notion of the property tax as the worst tax, let us add an important coda: except for all the others. --- *Jared Walczak is Vice President of State Projects at the Tax Foundation.* *This piece was* [*originally published*](https://adamnmichel.substack.com/p/the-free-market-case-for-property) *on Adam Michel's* [Liberty Taxed](https://adamnmichel.substack.com/)*.* *This is the second installment in a two-part series on property taxes. The first was Vance Ginn's* [The Case Against Property Taxes](https://www.bluegrassinstitute.org/the-case-against-property-taxes/). ### Universal pre-K is an expensive experiment URL: https://www.bluegrassinstitute.org/universal-pre-k-is-an-expensive-experiment/ Last updated: 2025-11-24T13:43:08.000Z Lt. Gov. Jacqueline Coleman's passionate case for guaranteeing preschool access for every 4-year-old in the state deserves scrutiny. The evidence for universal pre-K as an economic development strategy is far weaker than she suggests. Kentucky families deserve honesty about what this expensive and expansive program can – and cannot – deliver. Coleman omits the most rigorous recent research on the subject. Researchers from Vanderbilt University followed nearly 3,000 low-income children through sixth grade with alarming[ results](https://psycnet.apa.org/doiLanding?doi=10.1037%2Fdev0001301&ref=bluegrassinstitute.org): Children who attended Tennessee's Voluntary Pre‑K (TN-VPK) program fared **worse** on a range of metrics compared with children who didn't attend. On the academic front, any gains observed in pre-K faded by the end of kindergarten. Even worse, the negative effects grew larger over time. Children who were in the pre-K program scored lower on achievement tests in both third and sixth grade compared to their peers who did not attend. By sixth grade, pre-K attendees were more likely to be in special education. The negative impacts carried over to behavior, too. TN-VPK students showed higher rates of disciplinary incidents, including suspensions and expulsions, and slightly lower attendance rates. The researchers theorized that center-based care, which generally becomes the default setting when the government expands funding, hinders the development of children’s self-control, a key foundation for long-term success. Importantly, TN-VPK isn't a small pilot program – it’s exactly the type of scaled-up, statewide public pre-K that Coleman proposes for Kentucky. Researcher[ Dale Farran](https://news.vanderbilt.edu/tag/dale-farran/?ref=bluegrassinstitute.org), who spent decades studying early childhood education,[ admitted](https://www.npr.org/2022/02/10/1079406041/researcher-says-rethink-prek-preschool-prekindergarten?ref=bluegrassinstitute.org) the findings forced "a lot of soul-searching" about everything she thought she knew. “At least for poor children, it turns out that something is not better than nothing,” she[ concluded](https://hechingerreport.org/a-state-funded-pre-k-program-led-to-significantly-negative-effects-for-kids-in-tennessee/?ref=bluegrassinstitute.org). Research consistently shows that initial academic gains from pre-K typically fade out by third grade. This "fade-out effect" has been documented across multiple[ evaluations](https://www.science.org/doi/10.1126/science.adn2141?ref=bluegrassinstitute.org#core-R6-1). Even the much-touted Boston pre-K program has shown mixed results. A recent[ study](https://www.nber.org/system/files/working%5Fpapers/w28756/w28756.pdf?ref=bluegrassinstitute.org) found some positive outcomes, particularly for boys – higher rates of high school graduation and college enrollment, plus fewer disciplinary issues in high school. But neither this study nor a separate[ one](https://research.ebsco.com/c/thnjem/viewer/pdf/kaxsw66phr?ref=bluegrassinstitute.org) found any positive effects before high school. Coleman's rosy projections – $9,000 annual earnings boost, 70,000 new workers – deserve skepticism. National estimates suggest quality universal pre-K costs around $12,500 per child annually. For Kentucky, that means hundreds of millions in annual costs requiring either tax increases or cuts to other priorities. Further, Coleman doesn't address a key issue: Most existing state pre-K programs are mediocre. According to the National Institute for Early Education Research, only six programs in five states meet all 10 quality benchmarks. Thirty-seven percent of children in state-funded preschool attend programs meeting fewer than half the quality standards. Even programs that meet most of those standards, such as Tennessee’s, haven’t proven beneficial to children. Religious or other values-based providers can also be harmed by government pre-K programs. For example, many religious providers[ cannot participate](https://www.catholicnewsagency.com/news/266901/colorado-court-rules-against-catholic-preschools-in-school-choice-program?ref=bluegrassinstitute.org) in Colorado’s universal pre-K program due to a provision that requires them to admit students regardless of sexual orientation and “gender identity,” including the child or the child’s family. Faith traditions that hold a traditional view of marriage or do not believe people can change genders now face an uneven playing field as other pre-K providers receive a public subsidy. And families who want their children to attend those preschools can’t utilize the program their tax dollars fund. Coleman is right that Kentucky families struggle with childcare costs and access. But universal pre-K is not the solution she claims. The research on large-scale, statewide programs is mixed at best and concerning at worst. “Pre-K for All" sounds appealing in political speeches. But Kentucky families need solutions that actually work, not programs rooted in wishful thinking. If other states' universal pre-K programs show disappointing results, why should Kentucky expect different outcomes? And if we're serious about helping children, shouldn't we demand better evidence before spending hundreds of millions of dollars from taxpayers? Kentucky's children deserve evidence-based policy, not expensive experiments. It's time for honest conversation about early childhood education – one that acknowledges both pre-K's limits and the need for smarter, targeted solutions. --- *Caleb O. Brown is CEO of the Bluegrass Institute. Colleen Hroncich is a policy analyst with the Cato Institute’s Center for Educational Freedom.* *This piece originally appeared in the Booneville Sentinel.* ### The Case Against Property Taxes URL: https://www.bluegrassinstitute.org/the-case-against-property-taxes/ Last updated: 2025-11-19T13:30:55.000Z Property ownership is the cornerstone of a free society. It reflects the natural right of individuals to control what they create, earn, or voluntarily exchange with others. From that right flows responsibility, independence, and the ability to build a legacy. Yet today, homeowners must pay the government every year simply to keep what they already own. Property taxes are not a reasonable price for local services—they are an outdated, overly coercive, and economically destructive way to fund government. They should end. Across [Texas](https://www.vanceginn.com/letpeopleprosper/eliminating-property-taxes-in-texas-real-options-for-true-homeownership-and-economic-prosperity?ref=bluegrassinstitute.org), [Florida](https://jamesmadison.org/property-tax-relief-in-florida-challenges-options-and-the-path-to-true-homeownership/?ref=bluegrassinstitute.org), [Wyoming](https://texastaxpayers.com/bold-reform-to-rein-in-wyomings-soaring-property-taxes/?ref=bluegrassinstitute.org), [Iowa](https://itrfoundation.org/a-2-percent-property-tax-cap-a-necessary-step-for-iowa/?ref=bluegrassinstitute.org), and [Montana](https://frontierinstitute.org/reports/the-2024-real-local-budgets/?ref=bluegrassinstitute.org), more people are realizing that property taxes—once accepted as a “necessary evil”—are neither necessary nor moral, especially when government spending is not properly restrained. The principle is simple: nothing is free, but ownership should be secure once it’s earned. ![white and red wooden house miniature on brown table](https://images.unsplash.com/photo-1560518883-ce09059eeffa?crop=entropy&cs=tinysrgb&fit=max&fm=jpg&ixid=M3wzMDAzMzh8MHwxfHNlYXJjaHwyfHxwcm9wZXJ0eSUyMHRheHxlbnwwfHx8fDE3NjE1NzYxMDR8MA&ixlib=rb-4.1.0&q=80&w=1080 "white and red wooden house miniature on brown table") Photo by [Tierra Mallorca](https://unsplash.com/@tierramallorca?ref=bluegrassinstitute.org) on [Unsplash](https://unsplash.com/?ref=bluegrassinstitute.org) ## Property Taxes Undermine Ownership and Prosperity Property is the foundation of liberty. It represents the right to the product of voluntary exchange, investment, and saving—not a privilege granted by government. To tax property again every year after it has been bought with after-tax income is to deny genuine ownership. Property taxes operate like an annual wealth tax or unrealized capital-gains tax, applied regardless of income or ability to pay. Defenders argue that property taxes are “good” because they connect local services to local funding. I understand the intuition—communities need schools, infrastructure, and public safety—but it assumes government spending is inherently justified. It isn’t. The moral and fiscal failure of property taxes lies not only in how the money is raised, but also in how much government spends. When government grows beyond its limited role of protecting life, liberty, and property, it erodes the foundation of those rights. Property taxes turn citizens into perpetual tenants of the state. The idea that people can “own” what the government requires an annual payment for contradicts the essence of a free society. ## The Regressive and Hidden Nature of Property Taxes Property taxes fall hardest on lower- and middle-income families because housing costs make up a larger share of their budgets. High-value properties are often under-assessed, while modest homes are over-assessed. The Texas Comptroller’s Office uses the [Suits Index](https://comptroller.texas.gov/transparency/reports/tax-exemptions-and-incidence/?ref=bluegrassinstitute.org) to measure the tax incidence of different taxes in Texas and consistently ranks property taxes among the most regressive. But it’s worse than the tax incidence data suggest. Property taxes also hit people who never receive a property-tax bill. Renters pay indirectly through higher rent, and business owners pay through commercial leases, lower wages, and reduced investment. For millions of Americans, property taxes are the least visible yet most unavoidable form of taxation. They also distort behavior. The lock-in effect discourages families from moving because new homes trigger higher assessments, while the push-out effect forces seniors and low-income residents from homes they’ve already paid off. These distortions are not captured in incidence studies, making property taxes uniquely harmful—penalizing both entry and exit from the housing market. No tax that allows the government to seize a family’s home for nonpayment can be considered good. That isn’t sound public finance, it’s legalized coercion. ## Overspending, Not Undertaxation The [Tax Foundation’s Jared Walczak](https://taxfoundation.org/research/all/state/property-tax-repeal-replace-revenue/?ref=bluegrassinstitute.org) notes that property taxes supply roughly 70 percent of local-government revenue and argues that replacing them would be difficult. He’s right that any transition must be designed carefully, but he assumes that today’s level of state and local spending is acceptable. It isn’t. Across the country, overspending is the root cause of the property-tax crisis. High property tax shares are a symptom of the problem that needs to be addressed, not a reason to abandon reform as property taxes become an increasing burden. - In Texas, local governments now collect more than $80 billion in property taxes—up roughly 70 percent from 2015 to 2024, while population growth plus inflation rose only 50 percent, even after several years of high inflation. - Florida collects about $55 billion per year—nearly equal to all its state-level taxes combined. - In Montana and Wyoming, property-tax collections have surged even though energy revenues could have offset some of the burdens. Some also argue that reliance on property taxes is necessary because sales taxes or other revenue sources are too volatile. But families, not governments, deserve income stability. Revenue fluctuations should be managed through sustainable budgeting and rainy-day funds, not by taxing people out of their homes. In Texas, property-tax revenues are actually *less stable* than many believe. From 1998 to 2024, the standard deviation for sales-tax growth was 0.057, compared with 0.037 for property taxes. The overall trend shows property taxes rising much faster and disconnected from economic activity or taxpayers’ ability to pay. ## Sustainable Budgeting: The Principle for Every State While eliminating property taxes entirely will take time, every state can start by adopting [sustainable budgeting](https://atr.org/budgetproject/?ref=bluegrassinstitute.org)—ensuring that government spending grows *slower than population growth plus inflation*. This limit should serve as a ceiling, not a target. When governments live within it, surpluses emerge from a faster-growing economy supporting increased tax revenue that exceeds spending. States should use those surpluses to permanently reduce, and eventually eliminate, school district property taxes. The tool used for this process should not pick winners and losers through property tax exemptions and abatements, or by short-term tax swaps that increase sales taxes to reduce property taxes, which simply shift the heavy burden elsewhere. Because education is largely a state responsibility, states can gradually replace school-district property-tax funding with simpler, broader, and more transparent sources—such as a low, uniform, flat sales tax on final goods and services (not a VAT)—while constitutionally prohibiting the return of property taxes. Local governments can apply the same surplus-buydown approach to lower their property-tax rates over time or use tax swaps to eliminate them. Differences in tax bases—property-rich versus sales-tax-poor areas—can be managed by reducing spending, forming local compacts, and establishing shared service arrangements rather than implementing state mandates. Debt-financed property taxes are more complex, but they are also local choices. Voter-approved debt should continue to be repaid locally until retired; it should not be socialized across jurisdictions. The state’s focus should remain on eliminating school-district property taxes while advancing [universal education savings accounts](https://vanceginn.substack.com/p/the-case-for-truly-universal-education), which allow money to follow students directly and simplify school finance over time. This principle applies everywhere: - States without income taxes (Texas, Florida, Wyoming) should prioritize property-tax elimination next. - States without sales taxes (like Montana) should pair property tax elimination with strong spending restraint and targeted consumption-based alternatives. - States with all three central taxes should prioritize controlling spending before pursuing any tax swaps or other tax changes. For states with income taxes, the surplus buydown method should be used to eliminate them first. The goal is not revenue neutrality—it’s smaller government in terms of taxes and spending. ## The Moral and Economic Case for Ending Property Taxes Property taxes distort markets, destroy mobility, and erode liberty. More fundamentally, they violate the natural right to ownership—the right to control one’s property free from perpetual government claim. Property tax relief is about redesigning government to live within its means. When governments spend and tax less, they unleash growth, investment, and genuine ownership. --- *This piece was originally published on Adam Michel's* [*Liberty Taxed: A Blog on US Tax Policy*](https://adamnmichel.substack.com/p/the-case-against-property-taxes) ### A Menu of Options for Kentucky Housing Reform 2026 URL: https://www.bluegrassinstitute.org/a-menu-of-options-for-kentucky-housing-reform-2026-2/ Last updated: 2025-11-12T13:05:25.000Z --- ### **Housing reform in Kentucky should …** 1. Enhance Kentuckians’ property rights. 2. Respect the timelines of Kentucky property owners who wish to create new and better housing. 3. End mandates and limits on the creation of new housing that have no meaningful connection to advancing Kentuckians’ health or safety. 4. Respect the wide variety of types of housing Kentuckians prefer and the ways in which Kentuckians prefer to use their property. --- For businesses considering an expansion or relocation to one of several states, the cost of housing for workers is a key factor. This puts Kentucky at an economic crossroads. The bad news is that Kentucky has seen the same increases in housing prices as other states. In urban areas, the rise in housing prices has been especially pronounced. **Median home prices in Lexington and Bowling Green are now more than five times median incomes**. Those increases are pushing many families out of the market for home ownership, limiting housing choices, delaying marriage and childbirth, stunting job growth, lengthening commutes, and broadly preventing many Kentuckians from leading more productive and fulfilling lives. **The Bottom Line: Without a robust housing supply, Kentucky will lose its competitive edge.** Employers will struggle to attract talent, essential workers will be priced out of their communities, and local economies will suffer. **The Opportunity:** **The reforms Kentucky needs would enhance property rights and lower costs across the board. Lawmakers can make these reforms quickly, and none of them require a costly new government program.** What follows are changes adopted in other states (and some reforms Kentucky has considered) to **streamline permitting, give individuals more control over their own property, and reduce overall housing costs.** If policymakers adopted all reforms presented here, our commonwealth would soon become the undisputed leader in abundant, affordable housing … all without placing new burdens on taxpayers. [*Caleb O. Brown*](https://www.bluegrassinstitute.org/author/calebobrown) *CEO, Bluegrass Institute* [A Menu of Options for Kentucky Housing Reform 2026Without a robust housing supply, Kentucky will lose its competitive edge.251112KYHousingMenu.pdf334 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2025/11/251112KYHousingMenu.pdf "Download") --- ### **Permitting Reform** **Problems with current Kentucky permitting:** Delays in permitting drive housing costs higher as property owners must navigate needless regulatory uncertainty. Local governments often fail to issue permits in a timely manner to mitigate that uncertainty. Lawmakers can streamline this process and give developers and property owners new avenues to secure permits in a timely fashion. **Kentucky lawmakers should:** - Implement the Shot Clock: Encourage or incentivize local authorities to approve housing permits in a timely manner. ([Texas 2023 HB 3697](https://capitol.texas.gov/tlodocs/88R/billtext/html/HB03697I.htm?ref=bluegrassinstitute.org)) ([Arkansas: 2023 HB 1207](https://arkleg.state.ar.us/Bills/Detail?id=hb1207&ddBienniumSession=2023%2F2023R&ref=bluegrassinstitute.org)) - Enable third party permit review either automatically or after regulatory authorities fail to approve permits in a timely manner. ([Tennessee 2024 SB 2100](https://wapp.capitol.tn.gov/apps/BillInfo/default.aspx?BillNumber=SB2100&GA=113&ref=bluegrassinstitute.org)) ([Texas: 2023 HB 14](https://capitol.texas.gov/tlodocs/88R/billtext/html/HB00014F.HTM?ref=bluegrassinstitute.org)) - Ensure that exactions/impact fees are proportional to realized infrastructure costs, as Tennessee, Arkansas, North Carolina, Illinois, Ohio, Florida and Minnesota have done through courts or legislation. (see e.g. [Fla. Stat. 163.31801 (2025)](https://www.leg.state.fl.us/statutes/index.cfm?App%5Fmode=Display%5FStatute&URL=0100-0199/0163/Sections/0163.31801.html&ref=bluegrassinstitute.org)). - Require “specific and objective” criteria for permits and other development approvals. ([Tennessee: 2025 SB 1313](https://wapp.capitol.tn.gov/apps/BillInfo/default.aspx?BillNumber=SB1313&GA=114&ref=bluegrassinstitute.org)) ([Rhode Island 2023 S 1034](https://webserver.rilegislature.gov/BillText23/SenateText23/S1034.htm?ref=bluegrassinstitute.org)) - Secure zoning rights at application time to enhance “vested rights” in property. ([Tennessee: 2025 SB 1313](https://wapp.capitol.tn.gov/apps/BillInfo/default.aspx?BillNumber=SB1313&GA=114&ref=bluegrassinstitute.org)) To its credit, Kentucky has already taken a significant step toward limiting the range of people who can stop new housing through litigation.That step will give Kentuckians’ more control over their property and will give developers additional certainty that many projects are worth pursuing. ([Kentucky: 2025 HB 321](https://apps.legislature.ky.gov/record/25rs/hb321.html?ref=bluegrassinstitute.org)) ### **Zoning Reform** **Problems with current Kentucky zoning:** The purpose of zoning is to give local governments greater control over land use. Whatever its benefits, there’s no question that zoning’s control over development now extends well beyond advancing any legitimate health or safety protection. The impact of that regulation on housing prices, economic dynamism, and the property rights of Kentuckians is hard to overstate. Reducing needless zoning restrictions shows respect for property owners and is the best way to secure the benefits of abundant low-cost housing. **Kentucky lawmakers should:** - Adopt the “Golden Girls Rule” to end restrictions on unrelated people living together. ([New Hampshire: 2025 HB 457](https://gc.nh.gov/bill%5Fstatus/billinfo.aspx?id=886&inflect=2&ref=bluegrassinstitute.org)) - End local prohibitions on smaller residential lots. ([New Hampshire: 2025 SB 84](https://gc.nh.gov/bill%5Fstatus/legacy/bs2016/billText.aspx?sy=2025&id=1016&txtFormat=html&ref=bluegrassinstitute.org)) - Broadly allow up to four residential units on residential lots. ([Maine: 2025 LD 2003](https://www.mainelegislature.org/legis/bills/display%5Fps.asp?ld=2003&PID=1456&snum=130&ref=bluegrassinstitute.org)) - Legalize residential housing in all commercial zones. ([Florida: 2023 SB 102](https://www.flsenate.gov/Session/Bill/2023/102?ref=bluegrassinstitute.org)) - Allow charities to circumvent a range of zoning restrictions when building new housing. ([Kentucky: 2025 SB 59](https://apps.legislature.ky.gov/record/25rs/sb59.html?ref=bluegrassinstitute.org)) ([Oregon: 2021 SB 8](https://olis.oregonlegislature.gov/liz/2021R1/Downloads/MeasureDocument/SB8/?ref=bluegrassinstitute.org)) - Legalize home-based businesses. ([Florida: 2021 CS/HB 403](https://www.flhouse.gov/Sections/Bills/billsdetail.aspx?BillId=70558&ref=bluegrassinstitute.org)) - Legalize accessory dwelling units. ([Arkansas 2025 HB 1503](https://arkleg.state.ar.us/Bills/Detail?id=HB1503&ddBienniumSession=2025%2F2025R&ref=bluegrassinstitute.org)) ([Montana: 2023 SB 528](https://archive.legmt.gov/bills/2023/SB0599/SB0528%5F2.pdf?ref=bluegrassinstitute.org)) - Establish a presumption of freedom in zoning code interpretations. ([Montana: 2025 SB 214](https://bills.legmt.gov/?ref=bluegrassinstitute.org#/laws/bill/2/LC1016)) ### **Containing Housing Costs** **Problems with current and future high housing costs:** Two of Kentucky’s largest cities feature median home prices of more than five times median incomes. Other housing markets are trending in the same direction. For young people seeking a future in our commonwealth, it’s a troubling harbinger of things to come absent serious cost-cutting reform. **Kentucky lawmakers should:** - Increase residential code threshold to four units. ([North Carolina: 2023 HB 488](https://www.ncleg.gov/Sessions/2023/Bills/House/PDF/H488v7.pdf?ref=bluegrassinstitute.org)) - Direct the state building code agency to study and propose recommendations that will collectively cut code-related costs by 20%. ([California: 2025 AB6](https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill%5Fid=202520260AB6&ref=bluegrassinstitute.org)) - Amend codes to legalize single-stair buildings statewide ([Tennessee: 2024 SB 2834](https://wapp.capitol.tn.gov/apps/BillInfo/default.aspx?BillNumber=SB2834&GA=113&ref=bluegrassinstitute.org)) - Limit or eliminate off-street parking requirements for most developments. ([Montana: 2025 HB 492](https://bills.legmt.gov/?ref=bluegrassinstitute.org#/laws/bill/2/LC0886?open%5Ftab=sum)) ([Washington: 2025 SB 5184](https://app.leg.wa.gov/BillSummary/?BillNumber=5184&Year=2025&ref=bluegrassinstitute.org)) - Overhaul the building code process to require real cost-benefit analysis. - Clarify statutes to preclude cities from forbidding building materials otherwise allowed by state building code. ([Arkansas 2019 SB 170](https://www.arkleg.state.ar.us/Bills/Detail?measureno=SB170&ddBienniumSession=2019%2F2019R&ref=bluegrassinstitute.org)) In this area, Kentucky has made a significant and overdue change that will pay dividends for would-be homeowners going forward: Lawmakers this year strengthened protections for manufactured homes by prohibiting local governments from discriminating against them in zoning regulations. ([Kentucky: 2025 HB 160](https://apps.legislature.ky.gov/record/25rs/hb160.html?ref=bluegrassinstitute.org)) ### **Additional notes** Taken together, these reforms would place Kentucky at the center of a housing boom. The follow-on effects of such a dramatic shift in how the commonwealth treats housing would include a lower cost of living for tens of thousands of Kentucky families, a dramatic expansion in housing production, and dependably robust job growth for years to come. *The Bluegrass Institute is grateful for the assistance of* [*Charles Gardner*](https://www.bluegrassinstitute.org/author/charles-gardner/) *and* [*M. Nolan Gray*](https://www.bluegrassinstitute.org/author/mnolangray/) *in preparing these recommendations.* [A Menu of Options for Kentucky Housing Reform 2026Without a robust housing supply, Kentucky will lose its competitive edge.251112KYHousingMenu.pdf334 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2025/11/251112KYHousingMenu.pdf "Download") ### Legislative Overview: The Family Preservation and Accountability Act URL: https://www.bluegrassinstitute.org/the-family-preservation-and-accountability-act/ Last updated: 2025-11-10T13:25:35.000Z Kentucky has one of the highest rates of children with incarcerated parents in the U.S., with an estimated 12% of children affected. The impact of parental incarceration has long-lasting consequences on children’s health, education, and future involvement in the justice system. With 64% of women and 55% of men incarcerated in Kentucky being parents, the need for change is urgent. The **Family Preservation and Accountability Act** addresses these challenges by expanding sentencing alternatives for primary caregivers convicted of non-violent offenses. This bill prioritizes family unity, reduces harm from the separation of parents and children, and offers a rehabilitative approach that preserves the parent-child relationship while safeguarding child safety. **Sentencing Alternatives for Primary Caregivers:** Courts are required to consider an individual’s caregiver status before sentencing for non-violent offenses and explore alternatives to incarceration when the individual does not pose a safety risk. **Focus on Rehabilitation:** The bill encourages sentences that support the parent-child relationship, including parenting programs, mental health counseling, and vocational training to reduce recidivism and improve family stability. **Transparency and Accountability:** Courts must provide written findings on sentencing alternatives, and the Administrative Office of the Courts must report annually to the Kentucky General Assembly on the bill’s implementation and impact. - **Reduces adverse childhood experience** by preserving healthy parent-child relationships; - **Lowers foster care placements** by enabling primary caregivers to remain at home; - **Supports rehabilitation** to reduce recidivism and improve family stability; - **Enhances public safety** through community-based alternatives to incarceration. [2025 Family Preservation Act (FPA) OverviewThe impact of parental incarceration has long-lasting consequences on children.2025 Family Preservation Act (FPA) Overview.pdf1 MBdownload-circle](https://www.bluegrassinstitute.org/content/files/2025/10/2025-Family-Preservation-Act--FPA--Overview.pdf "Download") ### The Kentucky Housing Crisis is Here: Caleb O. Brown Appears on KNN's Kentucky Focus URL: https://www.bluegrassinstitute.org/the-kentucky-housing-crisis-is-here-caleb-o-brown-appears-on-knns-kentucky-focus/ Last updated: 2025-11-06T21:48:08.000Z Bluegrass Institute CEO Caleb O. Brown sits down with Scott Fitzgerald on KNN's *Kentucky Focus* show to [discuss the housing crisis](https://www.iheart.com/podcast/1248-kentucky-focus-88859880/?ref=bluegrassinstitute.org) and why lawmakers must act now to turn the tide of housing affordability. ### Certificate of need laws cutting access to KY health care are overdue for reform URL: https://www.bluegrassinstitute.org/certificate-of-need-laws-cutting-access-to-ky-health-care-are-overdue-for-reform/ Last updated: 2025-11-04T13:01:52.000Z In May, a Powell County paramedic [saved snake expert Jim Harrison’s life](https://www.lex18.com/news/covering-kentucky/powell-county-paramedics-face-license-revocation-after-administering-anti-venom?ref=bluegrassinstitute.org) after a bite from a Jameson's mamba. Harrison called for emergency transport, but before the helicopter arrived, local paramedic Eddie Barnes acted swiftly to assist. Harrison, who keeps his own antivenom on hand because time is critical following a snake bite, begged Barnes to administer the antidote, saying he would die without it. Out of caution, Barnes called Clark Regional Medical Center, where an emergency room doctor granted him permission to administer the antivenom. Instead of celebrating Barnes, the Kentucky Board of Emergency Medical Services notified him that his emergency medical services (EMS) license was at risk of revocation. Following a rule change two years ago, only wilderness paramedics are permitted to administer antivenom in Kentucky. Thankfully, the board [dismissed Barnes’ case](https://www.lex18.com/news/covering-kentucky/kentucky-paramedics-cleared-of-disciplinary-action-after-anti-venom-administration?ref=bluegrassinstitute.org). But the fact that an EMS responder could be hauled before regulators for doing the right thing underscores how rigid rules can clash with patient care. Using occupational licensing regulations to prevent providers like Barnes from performing tasks for which they are trained is illogical, even dangerous. ### Certificate of need laws reduce patient access to care Similarly, certificate of need (CON) laws make it difficult or impossible for providers to offer new health care services in Kentucky. These laws, which restrict providers from opening facilities or expanding services, reduce patient access to care and can endanger lives. In 2017, entrepreneur [Philip Truesdell](https://www.wsj.com/articles/kentuckys-ambulance-cartel-is-afraid-of-phillip-truesdell-11570225646?ref=bluegrassinstitute.org) and his family founded a non-emergency medical transport company just over the border in Ohio to assist patients in traveling to appointments or between facilities. It was easier for Truesdell to start his company in Ohio because the Buckeye State doesn’t have CON laws for medical transport. Truesdell began receiving calls from Kentucky patients unable to access care only to learn he couldn’t help them without a CON from the Kentucky Cabinet of Health and Family Services. Applying for a CON in Kentucky is a costly drawn-out process, with competitors often [using the process to protest applications and block new entrants](https://ij.org/report/striving-for-better-care/survey-of-recent-con-applications/?ref=bluegrassinstitute.org). This is devastating for the hundreds of Kentucky residents requesting Truesdell’s medical transport services every year. ### The federal government agrees CON laws do more harm than good Proponents of CON laws claim health care providers need monopoly power to remain financially viable. However, [nearly 40% of the U.S. population lives in a state with no *—* or limited *—* CON laws](https://pacificlegal.org/research/certificate-of-need-reform-answering-the-fears/?ref=bluegrassinstitute.org), allowing economists to compare outcomes. As expected, restricting health care supply[ increases costs, reduces access and lowers quality](https://onlinelibrary.wiley.com/doi/abs/10.1002/soej.12698?ref=bluegrassinstitute.org). The federal government agrees: Every presidential administration since Reagan’s has urged states to curtail CON laws, which are particularly harmful in rural and underserved areas desperate for more care. Patients and providers *—* not government officials *—* should decide when care is needed. ### Regulation should empower, not restrain, frontline providers While in the end, no licenses were lost or careers ruined in Powell County, Barnes’s case highlights a broader issue: regulation should empower, not restrain, frontline providers. Rigid laws like CON mandates share the common flaw of prioritizing bureaucracy over patient outcomes. States are taking notice. Since 2023, Georgia, North Carolina, South Carolina, Tennessee and West Virginia have reformed their CON laws. Earlier this year, Kentucky lawmakers took a step forward by [repealing a CON law](https://www.kcnpnm.org/news/702986/New-Law-will-improve-access-to-birthing-centers.htm?ref=bluegrassinstitute.org) for birthing centers. More work remains. Legislators must continue to evaluate whether these laws serve constituents or merely protect the status quo. When laws threaten those who save lives, they must be reformed. *Jaimie Cavanaugh is state policy counsel at* [*Pacific Legal Foundation*](https://pacificlegal.org/?ref=bluegrassinstitute.org)*.* *Caleb O. Brown is CEO of the* [*Bluegrass Institute*](https://www.bluegrassinstitute.org/)*.* This article [first appeared](https://www.courier-journal.com/story/opinion/contributors/2025/11/03/kentucky-certificate-of-need-law-health-care/86959687007/?ref=bluegrassinstitute.org) at the *Louisville Courier-Journal*. ### But What About Staffing? URL: https://www.bluegrassinstitute.org/but-what-about-staffing/ Last updated: 2025-10-24T04:01:27.000Z [But What About Staffing?BIPPS\_101325\_Staffing-3.pdf778 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2025/10/BIPPS%5F101325%5FStaffing-3.pdf "Download") This report examines Fayette County Public Schools' (FCPS) troubling disconnect between staffing trends, student enrollment, and academic performance from 2010-11 to 2023-24\. While the district faces a $16 million budget shortfall, staffing has increased dramatically—Certified Staff by 18% and Classified Staff by 12%—despite declining student attendance after COVID-19 and falling academic performance, with ACT scores dropping from 20.1 to 18.9 over the period studied. Some highlights: - **Staffing-Enrollment Mismatch**: FCPS maintained stable or growing enrollment until 2020, but continued increasing staff even as Average Daily Attendance declined post-COVID, resulting in 314 more staff than needed if growth had matched student enrollment - **Academic Performance Decline**: Despite significant staffing increases, the district's average ACT composite score for 11th graders fell sharply from 20.1 in 2010-11 to 18.9 in 2023-24, with the steepest decline occurring after 2016-17 when staffing growth accelerated - **Divergent Staff Trends**: Certified Staff grew consistently (18% increase), while Classified Staff experienced a dramatic drop in 2014-15 before recovering and growing by 12% overall, suggesting different management approaches for different staff categories The FCPS board must urgently investigate the disconnect between rising staffing costs and declining academic outcomes, particularly given the district's current financial crisis. The board should conduct a comprehensive staffing audit to align personnel levels with actual enrollment, develop clear metrics linking staffing decisions to student performance improvements, and establish transparent reporting mechanisms to monitor these relationships going forward. Given that staff costs represent a major budget expense with no evidence of improved academic results, immediate action is needed to right-size the district's workforce while maintaining educational quality. [But What About Staffing?BIPPS\_101325\_Staffing-3.pdf778 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2025/10/BIPPS%5F101325%5FStaffing-3-1.pdf "Download") ### Boost Kentucky’s labor market: Reform occupational licensing URL: https://www.bluegrassinstitute.org/boost-kentuckys-labor-market-reform-occupational-licensing/ Last updated: 2025-10-22T15:40:40.000Z Kentucky’s labor market continues to struggle compared to neighboring states and the national average with an unemployment rate of[ 4.7% ](https://www.bls.gov/web/laus/laumstrk.htm?ref=bluegrassinstitute.org)– significantly higher than the national average of 4.3%. In contrast, states like Indiana and Virginia boast unemployment rates of 3.6%; Arkansas and West Virginia stand at 3.8%. A significant factor holding Kentucky back is its occupational licensing system – one of the nation’s most restrictive – which creates unnecessary barriers to employment. Occupational licensing requires individuals to meet state-mandated requirements, including education, training, exams and fees, before they can legally work in certain professions. While licensing is universal for some occupations like physicians and lawyers, Kentucky goes further, licensing 177 of the 254 occupations studied in a [national report](https://www.archbridgeinstitute.org/state-occupational-licensing-index/?ref=bluegrassinstitute.org) I coauthored for the Archbridge Institute. This makes Kentucky the fourth-most burdensome state, just behind Oregon which licenses 182 occupations. By comparison, Kansas – the least restrictive state – licenses only 122 and Indiana 134. This excessive licensing stifles Kentucky’s workforce. [Research](https://onlinelibrary.wiley.com/doi/abs/10.1111/bjir.12470?ref=bluegrassinstitute.org) shows that occupational licensing reduces employment by up to 27%. Kentucky policymakers should consider two common-sense reforms that would open up its labor market. First, eliminate unnecessary licensing requirements for low-risk occupations. For example, the commonwealth is one of only five states to license orthotic fitters. If 46 other states don’t license this profession, it’s hard to justify Kentucky criminalizing unlicensed work in this field. Second, adopt universal recognition and allow licensed workers moving to Kentucky to continue their profession without redundant exams or training. Twenty-eight other states have passed universal recognition, including Indiana, Ohio, Virginia and West Virginia. My [research](https://www.cato.org/research-briefs-economic-policy/now-you-can-take-it-you?ref=bluegrassinstitute.org) shows that employment and labor-force participation increases in states adopting universal recognition. Concerns about public safety are often raised, but the evidence suggests there’s no need for such worries. The fact that most states regulate professions with less-restrictive methods indicates that Kentucky’s heavy-handed approach is unnecessary. Universal recognition simply cuts red tape for qualified workers, ensuring they can contribute to the economy without delay. Occupational licensing reform enjoys bipartisan support, with figures as politically diverse as [Barack Obama](https://obamawhitehouse.archives.gov/sites/default/files/docs/licensing%5Freport%5Ffinal%5Fnonembargo.pdf?ref=bluegrassinstitute.org) and[ ](https://trumpwhitehouse.archives.gov/presidential-actions/executive-order-increasing-economic-geographic-mobility/?ref=bluegrassinstitute.org)[Donald Trump](https://trumpwhitehouse.archives.gov/presidential-actions/executive-order-increasing-economic-geographic-mobility/?ref=bluegrassinstitute.org) advocating for change. [Studies](https://academic.oup.com/restud/article-abstract/90/5/2481/7049987?ref=bluegrassinstitute.org) consistently show the costs of occupational licensing – higher consumer prices and reduced job opportunities – far exceed any of its benefits. By reducing licensing burdens, Kentucky can strengthen its labor market, make it more competitive regionally and nationally and unleash the full potential of its workforce – all at no cost to taxpayers. [*Bluegrass Institute*](http://bluegrassinstitute.org/?ref=bluegrassinstitute.org) *scholar Edward J. Timmons is vice president of policy at the* [*Archbridge Institute*](https://www.archbridgeinstitute.org/?ref=bluegrassinstitute.org)*.* *This piece first appeared at* [Kentucky Today](https://www.kentuckytoday.com/perspectives/op-ed-occupational-licensing-reform-can-boost-kentucky-s-labor-market/article%5Fc455c8f0-aa7d-4ac4-bf83-fc51e123f3f3.html?ref=bluegrassinstitute.org)*.* ### John Garen and Paul Coomes detail teacher compensation in Kentucky to the Kentucky General Assembly URL: https://www.bluegrassinstitute.org/john-garen-and-paul-coomes-detail-teacher-compensation-in-kentucky-to-the-kentucky-general-assembly/ Last updated: 2025-10-21T12:30:50.000Z ["Estimated Growth in Annual Public Teachers’ Compensation in Kentucky," ](https://www.bluegrassinstitute.org/content/files/2025/10/Growth-in-teachers--compensation-study-3.pdf)co-authored by Paul Coomes, Ph.D., and John Garen, Ph.D., analyzes data from 2006 to 2024, focusing on the role of state-funded benefits in boosting overall pay. Key findings include: - **Total compensation growth:** In 2024, the average teacher’s salary in Kentucky was $58,788\. However, with fringe benefits averaging $35,406, total compensation reached $94,194 – a 61.6% increase from $58,301 in 2006\. - **Inflation-adjusted gains**: When adjusted for inflation, total teacher compensation rose by 10.5% from 2006 to 2024, despite a 7.1% decline in inflation-adjusted salaries over the same period. - **Fringe benefits surge**: State on-behalf payments for benefits, including pensions and health insurance, jumped from $15,025 per teacher in 2006 to $35,406 in 2024 – a 136% nominal increase, or 61% when adjusted for inflation. - **Funding disparity**: While per-pupil funding increased by an inflation-adjusted 40.5% (from $14,698 in 2006 to $20,656 in 2023), teachers' compensation growth lagged behind. The report notes that, although teachers' compensation has grown, the much larger increase in school funding indicates that many resources are allocated elsewhere. Additionally, student academic performance has not kept pace with increases in either funding or teachers’ compensation. Coomes and Garen find that large increases in school funding – including nearly $2 billion in fringe-benefit payments for teachers – have not translated into better outcomes for students. According to the 2024 National Assessment of Educational Progress (NAEP), far more than half of Kentucky students are below proficiency in fourth- and eighth-grade reading and math. The NAEP data also highlights persistent academic-achievement gaps; only 12% of Black eighth-grade students were reading proficiently in 2024, compared with 33% of White students. Similar gaps have persisted for years. In 1998, NAEP eighth-grade reading results showed only 32% of White students and just 11% of Black students read proficiently. ### The Kentucky Housing Crisis Is Here URL: https://www.bluegrassinstitute.org/the-kentucky-housing-crisis-is-here/ Last updated: 2025-10-30T12:26:36.000Z **Join us for three events in Covington, Lexington, and Louisville to discuss the future of housing policy in Kentucky** ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/10/Copy-of-Invitacio--n-vertical-open-house-casa-minimalista-blanco--1--2.png) Join us for live events October 28 and 30. The Bluegrass Institute will host [three events focusing on the future of housing policy in our commonwealth](https://www.bluegrassinstitute.org/live-events-the-kentucky-housing-crisis-is-here/), and **I would love to see you there**. RSVP for any of these events below: October 28 - Northern Kentucky October 28 - Lexington 💡 October 30 - [Louisville](https://tockify.com/bluegrassinstitute/detail/5/1761861600000?ref=bluegrassinstitute.org) Why does this matter now? - Two of Kentucky's housing markets now feature average homes selling for five times median household income and the broad trend is moving in the wrong direction. - Kentucky's young people will choose other states if housing is too expensive. - Local governments routinely disrespect the property rights of the people who own or build housing and, until now, Frankfort has allowed the problem to fester. The upside is that serious housing reform doesn't need to burden taxpayers or involve needless handouts. We just need to respect property owners. Our housing scholar, [M. Nolan Gray](https://www.bluegrassinstitute.org/author/mnolangray/) will walk you through exactly what policymakers can do now to deliver vastly more housing, energize Kentucky's economy, and give the commonwealth's property owners their rights back. ### Kentucky needs public charter schools: An educator’s plea for choice URL: https://www.bluegrassinstitute.org/kentucky-needs-public-charter-schools-an-educators-plea-for-choice/ Last updated: 2025-10-16T13:53:59.000Z I was a public school teacher. Many of my closest friends still are, and my daughter attends our local public school. I know firsthand the challenges teachers face and the slow pace of systemic change. I stepped away from traditional public schools over 15 years ago, not from a lack of faith in public education, but to create a better model for students, families and teachers. That journey led me to apply to open what could become Kentucky’s first public charter school. I believe more families – especially those with limited financial means – deserve real options for their children’s education. Kentucky’s teachers deserve environments where they are trusted, supported and given the freedom to innovate. Public charter schools can deliver these opportunities. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/10/Gus-LaFontaine.webp) Gus LaFontaine operates LaFontaine Preparatory School in Richmond, Ky. Critics argue charter schools undermine the traditional system. I understand those concerns, but the current system – while serving many – certainly isn’t meeting every student’s needs. It’s a one-size-fits-all approach that fails too many students. To those in our traditional system of schools, let me ask: Are you satisfied with Kentucky’s only public education option? If so, I’m happy for you. If not, you’re not alone. I’m advocating for Kentuckians to have access to an additional public education model that operates successfully in all states bordering ours and in nearly every one – red and blue – across the nation. The school we built 15 years ago, which I hope will eventually become a public charter school, wasn’t designed to compete. We built it because we couldn’t wait for smaller class sizes, better teacher support or systemic fixes that never came. Now, we want to offer this tuition-free, open-to-all public education model to others. Here’s what our school offers: Our teachers teach four days a week, with the fifth day for uninterrupted planning. They have hour-long lunches. Class sizes are capped at 16 students. There is room to teach, collaborate and recharge. Our students get three recesses a day and are free of the burden of excessive test preparation. They move, play and grow. Critics claim charter schools will harm traditional public schools. But if we trust our public schools, why fear giving families options? Public schools will still have the largest budgets, most experienced teachers and best facilities. They’re not going anywhere. I believe in public schools. I also believe many families want options. Those goals can coexist. Critics say only the privileged will benefit. But wealthy families already have options. For low-income families, single parents and students who don’t fit neatly into – or thrive in – a uniform system, having only one option limits them in ways I believe are unjust. Kentucky teachers in traditional systems have ideas about how schools could better serve students and whisper to me that they’re ready to innovate. A public charter school system in Kentucky would empower them to act on their ideas, fostering innovation that benefits students and families. We must recognize that many families feel trapped in a standardized system and create schools that meet diverse student needs while empowering teachers. That’s why I’m hopeful Kentucky’s Supreme Court will soon rule that charter schools are constitutional under legislation passed by the General Assembly, enabling families, students and teachers to finally have real choices within our public education system. *Gus LaFontaine and his wife, Kristin, founded LaFontaine Preparatory School, a nonprofit private school in Madison County, in 2011 after a tour of duty in Afghanistan with the Kentucky Army National Guard. A former public-school teacher, LaFontaine sought to create an innovative approach to early education. The school has grown from 13 half-day pre-kindergarteners to over 175 students in pre-K through fifth grade. LaFontaine has applied to convert his school to Kentucky’s first public charter school. He’s a party in a Kentucky Supreme Court case challenging the constitutionality of legislation funding public charter schools.* *This article* [*first appeared*](https://theinteriorjournal.com/2025/10/10/kentucky-needs-public-charter-schools-an-educators-plea-for-choice/?ref=bluegrassinstitute.org) *at* The Interior Journal*.* ### Testimony to the Budget Review Subcommittee on Education URL: https://www.bluegrassinstitute.org/testimony-to-the-budget-review-subcommittee-on-education/ Last updated: 2025-10-15T14:17:28.000Z > *"Universities have long recognized that different students thrive in different educational environments. That's why, in states with charter school laws, universities are often among the most trusted charter school authorizers. We understand that educational quality isn't one-size-fits-all."* *Remarks delivered to the Kentucky General Assembly's Budget Review Subcommittee on Education on September 17, 2025.* Thank you, Senator Rawlings, Rep. Riley, Rep. Banta, and members of the subcommittee. It’s an honor to speak to you today about K12 innovation in Kentucky. ### State's university-K-12 choice programs 'working brilliantly' As you've heard today from my colleagues, Kentucky's universities have a remarkable track record of educational innovation through programs like the Model Laboratory School at EKU, the Young Scholars Academy at NKU, the Craft Academy at Morehead State and the Gatton Academy at Western Kentucky University. While I’m not here today to speak on behalf of WKU, my day job is as a professor, there, and I've had the privilege of working closely with the Gatton Academy, mentoring students and participating in the interview process for prospective students. These experiences have shown me firsthand what happens when we match exceptional students with educational environments designed to meet their unique needs. What you've heard described today are prime examples of educational choice working brilliantly. Each of these programs exists because traditional high schools – no matter how well-intentioned – simply cannot provide the specialized resources, advanced coursework and research opportunities that these academically gifted students require. As I learned when I helped interview applicants for the Gatton Academy, these students don't lack motivation or intelligence – far from it. They lack access to educational environments that can challenge and nurture their exceptional abilities. Their assigned public schools, through no fault of their own, often cannot offer the advanced mathematics, laboratory research or university-level coursework these students need to reach their potential. This isn't a new concept for higher education. Universities have long recognized that different students thrive in different educational environments. That's why, in states with charter school laws, universities are often among the most trusted charter school authorizers. We understand that educational quality isn't one-size-fits-all. Universities embrace diversity in educational approaches because we see the results: students who have been able to access learning environments tailored to their needs arrive at our institutions better prepared, more engaged and more successful. ### Expanding educational opportunities But here's the critical point: if specialized educational environments can transform outcomes for academically gifted students, why shouldn't we extend similar opportunities to all students who need something different from their assigned school? The student struggling in a large, traditional classroom might thrive in a smaller, more individualized setting. The student passionate about the arts might flourish in a school with robust creative programming. The student needing more hands-on, vocational preparation might succeed in an environment emphasizing practical skills. Parents know their children best. They understand their learning needs, their interests, their challenges, and their dreams. Just as the parents of our Gatton Academy students recognized their children needed something beyond what their local high school could provide, all parents deserve the opportunity to seek educational environments where their children can succeed. ### Federal program leverages private funds Which brings me to an unprecedented opportunity for Kentucky families. The recently passed federal budget reconciliation package includes a provision that could finally give Kentucky students the same educational choices available to children in 48 other states. The One Big Beautiful Bill Act establishes a federal tax credit for private donations to scholarship programs. These scholarships help eligible students access various education services, including private school tuition. Twenty-one states already operate similar programs successfully. This approach is particularly appealing because it uses private dollars, not public funds. Just as the federal government encourages charitable giving through tax deductions, this program incentivizes private support for educational opportunity. But here's the crucial detail: states must opt in to allow their residents to participate. The Kentucky legislature has the opportunity – and I would argue the obligation – to make our students eligible for this program. ### Kentucky needs school choice For too long, Kentucky has been one of the few states systematically denying students meaningful school choice options. We've seen the results of educational innovation right here in our university partnerships. We know these approaches work. Last year's failed constitutional amendment shouldn't be an excuse to deny Kentucky families this opportunity. That amendment was admittedly complex and confusing. But this federal program is different – it's ready to implement, it's been proven effective in other states, and it doesn't require Kentucky taxpayers to fund it. Let me be clear about what's at stake. We have tens of thousands of students in chronically underperforming schools who desperately need alternatives. These aren't just statistics – they're individual children with unique talents, interests, and potential. As my colleagues at the Cato Institute have noted, "Education choices should not be based on majority rule. It is simply wrong to compel families to pay for, and de facto attend, government schools that they find subpar, or even morally unacceptable, even if the majority is okay with them." ### Proven innovations already here, working The programs you've heard about today – Gatton, Craft, Young Scholars, and the Model Lab School – prove that Kentucky understands the power of educational innovation when students can access learning environments designed for their needs. The federal scholarship tax credit program represents an opportunity to extend this same principle to all Kentucky families, not just those lucky enough to have academically gifted children or the financial means to exercise choice on their own. ### Lawmakers urged to act Kentucky students deserve the same opportunities available to children in states all around us. I urge this legislature to act when you reconvene next year to opt Kentucky into this transformative federal program. Our students' futures depend on it, and I’m grateful for you to consider it. *Remarks delivered to the Kentucky General Assembly's Budget Review Subcommittee on Education on September 17, 2025.* ### Charter schools on trial: Will Kentucky parents finally get a choice? URL: https://www.bluegrassinstitute.org/charter-schools-on-trial-will-kentucky-parents-finally-get-a-choice/ Last updated: 2025-09-25T20:01:20.000Z The contrast between supporters and opponents of expanding education freedom in Kentucky was starkly evident during the recent Kentucky Supreme Court [hearing](https://ket.org/program/kentucky-supreme-court-coverage/commonwealth-of-kentucky-ex-rel-attorney-general-russell-coleman-v-council-for-better-education-inc-et-al/?ref=bluegrassinstitute.org) on the constitutionality of legislation funding public charter schools. On one side, the Council for Better Education (CBE) and the Kentucky Board of Education (KBE) – whose members were appointed by Gov. Andy Beshear largely because of their opposition to parental empowerment – argued against allowing Kentuckians access to public charter schools, an option available in 44 other states, Washington, D.C., Guam and Puerto Rico. Control and money drive their arguments. They resent the autonomy of charter schools, including their independent boards’ ability to tailor curriculum, staffing and resources to meet students’ needs. CBE and KBE lawyers claim this autonomy equates to a lack of accountability to local school boards, despite the fact that these boards are the only charter-schools authorizers and charters must comply with state testing, teacher certification, transparency laws and a host of other requirements – just like traditional public schools. Justice Michelle Keller from Northern Kentucky questioned, “Who's going to be accountable and how are we going to know ... whether the promises of the charter schools are being met?” State Solicitor General Matthew F. Kuhn, representing Attorney General Russell Coleman’s office, provided the pivotal response: “Parental choice is the ultimate accountability. Parents don’t have to send their kids to charter schools. Their kids only go there if they choose. And our submission would be that's the best form of accountability given that we presume that parents know best for their kids.” A ruling against this bill would suggest that Kentucky’s highest court believes the state constitution’s ratifiers, over 130 years ago, intended to deny parents the right to choose better public schools for their children. This contradicts the court’s 1989 [*Rose v. Board of Education*](https://law.justia.com/cases/kentucky/supreme-court/1989/88-sc-804-tg-1.html?ref=bluegrassinstitute.org) decision, which declared it the General Assembly’s “sole obligation to provide for an efficient system of common schools.” Justice Keller’s great concern regarding charter school accountability is commendable given none have even opened in Kentucky. But where’s that same unease for holding the traditional K-12 system accountable? Since 1990, in inflation-adjusted dollars Kentucky’s per-pupil funding has [surged](https://www.bluegrassinstitute.org/bluegrass-institute-policy-point-releases-analysis-of-trends-in-k-12-education/) by 122%, yet teacher compensation has declined, bureaucratic costs have ballooned and two-thirds of students overall – along with barely two in 10 minority students – fail to reach proficiency in math and reading. If we genuinely believe in *Rose*’s mandate for efficient resource use, closing achievement gaps and improving education, charter schools – which have proven effective in checking all those boxes in other states – should be embraced, not shunned. Yet Justice Keller dismissed these successes, stating, “Yeah, whatever's happening in the other 45 states, I don’t know,” then worried about diverting funds from traditional public schools. But funding school choice – charters included – hasn’t hurt Florida’s public schools at all. Kentucky can only dream about [Florida’s public school NAEP scores](https://bluegrass-institute.ghost.io/ghost/?ref=bluegrassinstitute.org#/editor/post/68cc42dfca6e6e0001cc285a). Justice Pamela Goodwine claimed that November’s vote against Amendment 2 rejected publicly funding charter schools, wondering “Should that impact our decision, or should we ignore the nearly two-thirds of the voters who do not wish to have taxpayer funds used in this manner?” But University of Kentucky law professor Paul Salamanca corrected her. “The referendum asked whether the people of Kentucky supported the idea of the General Assembly appropriating money for schools outside the system of common schools,” Salamanca instructed. “We are not outside the system of common schools.” Could Goodwine’s perspective be clouded by $200,000 in campaign ads from the Jefferson County Teachers’ Association (JCTA) during her Supreme Court bid, as reported by Louisville Public Media? Gov. Beshear also gave her a rare endorsement during the nonpartisan judicial race, prompting criticism from the Kentucky Judicial Campaign Conduct Committee for its potential to “further blur the line between judicial and partisan elections.” Both the JCTA and Beshear strongly oppose education freedom. Will such ties affect Goodwine’s ability to rule impartially on charter schools’ constitutionality? Can we ignore this potential bias? Short-term political considerations must not be allowed to deny Kentucky parents the option of public charter schools, which promise to enhance the state’s education system by fostering innovation, accountability and better outcomes for students. *Jim Waters is president of the* [*Bluegrass Institute*](https://www.bluegrassinstitute.org/)*.* *This column was previously published in newspapers statewide.* ### Testing Kentucky’s high schoolers: Dropping ACT, shifting to SAT is the wrong move URL: https://www.bluegrassinstitute.org/testing-kentuckys-high-schoolers-dropping-act-shifting-to-sat-is-the-wrong-move/ Last updated: 2025-09-19T16:50:41.000Z Kentucky’s education establishment is making a move to shift away from requiring public school students to take the ACT college entrance test in favor of the SAT. This will make it harder to compare Kentucky’s scores with other states. It will also make it harder for families to know how well schools have performed over time at preparing kids for college. During the early 2000s, Kentucky lawmakers made the smart decision to require all high school juniors to take a college entrance test. The program started in the 2007-08 school term using the well-known ACT College Entrance Test. Since then, only small changes have impacted the ACT, giving Kentucky a useful ACT trend line stretching back to 2007-08, allowing administrators and policymakers to track progress – or lack thereof – in improving educational outcomes. Kentucky’s state-developed tests haven’t offered the same consistency. The Commonwealth Accountability Testing System, in use in 2007-08, was replaced by the Kentucky Performance Rating for Educational Progress, in 2011-12 and the Kentucky Summative Assessment in 2022\. The frequent changes in state assessments, compounded by COVID-19’s impact on public schools, have prevented reliable long-term trend data from state tests. The ACT test has proven valuable for students, helping increase college enrollment. Schools across Kentucky also use the results to improve curriculum and instruction. So, what does the ACT trend line show? Initially, results were promising. ACT scores, which range from 0 to 36, rose steadily from the early years until 2016-17 before beginning to decline. By 2023-24, the gains in Kentucky’s ACT Composite Score for the state’s high school juniors from 2008-09 to 2016-17 had largely been lost. A brief recovery from the COVID-related low in 2020-21 stalled by 2023-24. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/09/data-src-image-68e53797-f1b6-448d-9f8d-14079db44a6a.png) Continued stability in ACT testing is essential to maintain a consistent trend line, enabling analysis of whether Kentucky can recover from the post-2016-17 slump. However, if the Kentucky Department of Education (KDE) has its way, that isn’t going to happen. In a secretive move, the KDE issued a bid for a new testing contract and awarded it to the SAT, abandoning the ACT. Switching to the SAT, a significantly different test, will erase the ACT’s trend line, potentially masking Kentucky’s educational performance for years. Whether the SAT can provide a comparable trend line is doubtful. After the Common Core State Standards arrived in 2010, the SAT underwent changes that raised concerns about declining rigor. Michael Torres, a staff member at the Classical Learning Test, another college entrance test, recently [noted](https://jamesgmartin.center/2025/06/the-sats-trust-fall/?ref=bluegrassinstitute.org): “Researchers at the University of Cincinnati trained an AI program to do SAT math questions going back to 2008, and it found that the test has been getting easier by about four points per year.” Torres also claims the SAT now includes fewer questions and has shortened reading passages from 500-750 words to 25-150 words. Those changes are particularly problematic given Kentucky statutes requiring the college entrance test to assess science and English. The SAT doesn’t directly test these subjects, instead attempting to derive science scores from its reading, writing, and math assessments. With fewer questions and shorter reading passages, it’s unlikely the SAT can meaningfully evaluate science knowledge. If the SAT generates a science score from tests designed for reading, writing and math, those assessments may prioritize science content over other areas, such as humanities or foundational American documents, which were once part of the SAT. Such a science bias could disadvantage students stronger in humanities or English literature. ACT, Inc. has challenged the SAT bid award. For the sake of credible, consistent data on Kentucky’s education system, it would benefit students and educators if the ACT prevails. *Richard G. Innes is an education analyst at the* [*Bluegrass Institute*](https://www.bluegrassinstitute.org/)*.* ### Expand innovative education opportunities to all students URL: https://www.bluegrassinstitute.org/expand-innovative-education-opportunities-to-all-students/ Last updated: 2025-10-06T13:30:56.000Z Gary Houchens urges lawmakers to opt into the federal scholarship tax credit program included in the federal budget reconciliation bill In testimony on Sept. 17, 2025, before the legislature's Budget Review Subcommittee on Education, the Bluegrass Institute's Gary Houchens points to the overwhelming success of Kentucky’s innovative university-led K-12 programs, including the Gatton and Craft academies, as reasons to expand educational choice to all Kentucky students. To help make that happen, he urges lawmakers to opt into the federal scholarship tax credit program included in the federal budget reconciliation bill, which leverages private donations to fund scholarships for private education without using public funds, a model proven successful in 21 other states without using public funds. ### WHAS11: Charter Schools at Kentucky's highest court URL: https://www.bluegrassinstitute.org/whas11-charter-schools-at-kentuckys-highest-court/ Last updated: 2025-09-11T15:07:19.000Z Jim Waters discusses charter schools on Good Morning Kentuckiana (09/10/25) ### Answers to questions about public charter schools: What are they? Who do they serve? Will they work? URL: https://www.bluegrassinstitute.org/answers-to-questions-about-public-charter-schools-what-are-they-who-do-they-serve-will-they-work/ Last updated: 2025-09-10T10:00:21.000Z ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/09/shutterstock_313989317-1.jpg) FRANKFORT, Ky. – The Kentucky Supreme Court will hear oral arguments tomorrow in a [case](https://kentuckylantern.com/wp-content/uploads/2023/12/638379008938376450.pdf?ref=bluegrassinstitute.org) that could enable the creation and funding of public charter schools in the commonwealth. The Bluegrass Institute for Public Policy Solutions, Kentucky’s leading advocate for education freedom, has released a [Frequently Asked Questions](https://www.bluegrassinstitute.org/frequently-asked-questions-about-public-charter-schools/) brief explaining what public charter schools are and how they operate. The FAQ brief addresses 12 key questions about public charter schools and the policies that govern them, including: ● [How do public charter schools differ from traditional public schools?](https://www.bluegrassinstitute.org/frequently-asked-questions-about-public-charter-schools/#how-do-public-charter-schools-differ-from-traditional-public-schools) ● [How will teachers fare with the availability of public charter schools?](https://www.bluegrassinstitute.org/frequently-asked-questions-about-public-charter-schools/#how-do-teachers-fare-with-the-availability-of-public-charter-schools) ● [Will public charter schools adequately serve students with disabilities?](https://www.bluegrassinstitute.org/frequently-asked-questions-about-public-charter-schools/#will-public-charter-schools-adequately-serve-disabled-students) ● [Are public charter schools viable in rural areas?](https://www.bluegrassinstitute.org/frequently-asked-questions-about-public-charter-schools/#are-public-charter-schools-viable-in-rural-areas) ● [How do public charter schools impact the traditional public school system?](https://www.bluegrassinstitute.org/frequently-asked-questions-about-public-charter-schools/#how-do-public-charter-schools-impact-the-traditional-public-school-system) “Our FAQ brief offers Kentuckians clear, concise information about public charter schools – available to families in 44 other states, including all of Kentucky’s neighbors – and Washington, D.C.,” said Bluegrass Institute President Jim Waters. “Please share this resource with anyone seeking to understand what charter schools are, how they operate and why Kentucky needs them.” Tomorrow’s hearing will begin at 10 a.m. EDT in Newlin Hall at the Norton Center for the Arts on Centre College’s campus in Danville. The proceedings will be livestreamed on Kentucky Educational Television’s website [here.](https://ket.org/legislature/archives/2024/interim/interim-joint-committee-on-appropriations-revenue-7nq92f?ref=bluegrassinstitute.org) *Sign up* [*here*](https://www.bluegrassinstitute.org/get-involved/) *to learn more about the Bluegrass Institutes, receive regular updates and join us in advancing freedom and prosperity through free markets, limited government and personal liberties.* ### Frequently Asked Questions about Public Charter Schools URL: https://www.bluegrassinstitute.org/frequently-asked-questions-about-public-charter-schools/ Last updated: 2025-09-09T13:08:46.000Z **The fate of charter schools in Kentucky is currently before the commonwealth's highest court. Here's what you ought to know about this widespread reform that has yet to benefit Kentucky families.** The Bluegrass Institute's amicus brief in the case is here: [Bluegrass Institute Charter Schools Amicus BriefThe relevant portion of our state constitution places no limitations on general fund appropriations.Amicus Brief Charters 2024.pdf486 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2025/09/Amicus-Brief-Charters-2024.pdf "Download") ### **What are public charter schools?** Innovative public schools of choice that operate with greater flexibility than traditional public schools, allowing innovative teaching methods. Tuition-free and independently operated, with autonomy in exchange for meeting strict accountability standards. Public schools of choice that must accept all students who apply – regardless of race, disability or academic ability – on a first-come, first-served basis. Most state laws require charter schools with more applicants than available seats to hold a random lottery to determine admission. Charter schools are not allowed to “cherry pick” students based on demographic characteristics or deny admission to students with behavioral issues or disabilities. ### **How do public charter schools differ from traditional public schools?** They operate independently, offering greater flexibility in staffing, curriculum design, budgeting and governance. In exchange for this autonomy, charters must meet specific performance goals outlined in their charter contracts, which are reviewed by an authorizing body. If charters fail to meet these standards, they can be closed. Parents voluntarily enroll their children in charter schools, unlike traditional public schools, where students are typically assigned based on residence rather than educational fit. ### **How are public charter schools funded?** Funded publicly based on student enrollment and tuition-free. [Legislation](https://apps.legislature.ky.gov/record/22rs/hb9.html?ref=bluegrassinstitute.org) passed by the Kentucky General Assembly in 2022 ensures that charter school students receive funding comparable to their peers in traditional public schools by: (1) releasing the state’s per-pupil SEEK funds to follow students to charter schools, and (2) requiring local districts to share a portion of property tax revenue with charter schools. Many charter schools supplement their public funding with private donations, fundraising efforts and grants from the federal government and nonprofit organizations. ### **Who do public charter schools serve?** Underserved demographic groups seeking high-quality public education. The U.S. Department of Education finds that charters schools enroll more Black and Hispanic students and fewer White students than traditional public schools. Many charters schools also prioritize outreach to low-income, minority communities. In [New York City,](https://nyccharterschools.org/policy-research/fact-sheets/charter-facts/?ref=bluegrassinstitute.org) approximately 46% of charter school students (68,500 children) are Black, with another 43% Hispanic. By comparison, in the city’s traditional public schools, approximately 24.5% were black, 41% Hispanic, 16.6% Asian and 14.7% White in the 2021-22 school year. ### **Who are public charter school authorizers?** Entities, such as school boards, state boards of education, universities or separate charter school commissions, that sponsor, approve, oversee, renew, and, if necessary, close charter schools. Authorizers ensure charter schools fulfill their educational mission, comply with legal and financial regulations and meet academic performance expectations. ### **Are public charter schools accountable?** Charter schools must meet performance goals in their charter agreements – subject to review by authorizers – and face closure if standards are not met. Parental choice drives enrollment, serving as a key accountability mechanism for charter schools. ### **How do teachers fare with the availability of public charter schools?** Charter school expansion provides teachers with [more employment options](https://thehill.com/opinion/education/3859457-school-choice-can-help-public-school-teachers-heres-how/?ref=bluegrassinstitute.org) in diverse teaching environments and educational philosophies. Increased school choice also heightens demand for teachers, with studies showing higher pay across public, private and charter schools. ### **Will public charter schools adequately serve disabled students?** Charter schools increasingly serve low-income, minority communities and families with students who have disabilities. Consider the [Tapestry Public Charter School in Doraville, Georgia: ](https://tapestrycharter.org/?ref=bluegrassinstitute.org) > *Tapestry is designed to break away from the traditional “one-size-fits-all” approach to education for middle and high schoolers. We don’t believe in classifying students as either “general education” or “special education.” Instead, Tapestry recognizes and celebrates the diverse learning profiles and needs of all of our students. Our model is simple: we value all of our students for their uniqueness and believe that each one deserves to feel included in all aspects of the learning process. Tapestry’s fully inclusive academic model supports this belief and creates a platform for all of our students to succeed.* ### **Are public charter schools viable in rural areas?** Many rural charter schools are founded by parents, teachers or community groups, enabling more local input in education. Charter schools tailor education to local needs, such as agricultural studies, STEM programs or vocational training. For example, the [Maine Academy of Natural Sciences in Hinckley, Maine](https://maineacademy.org/?ref=bluegrassinstitute.org) – the state’s first of now 13 charters schools – uses a hands-on approach with a focus on natural sciences, sustainability and outdoor education. ### **How do public charter schools impact the traditional public school system?** A Stanford University [study](https://ncss3.stanford.edu/wp-content/uploads/2023/06/Credo-NCSS3-Report.pdf?ref=bluegrassinstitute.org) (2015-2019) found that charter school students, particularly Black and Hispanic students, showed greater reading and math gains compared to their peers in traditional public schools. Most [studies](https://www.edchoice.org/wp-content/uploads/2023/07/123s-of-School-Choice-WEB-07-10-23.pdf?ref=bluegrassinstitute.org) show school choice policies, including charter-school programs, positively impact students’ academic performance. ### **Are public charter schools a new idea?** No. The first public charter school opened in Minnesota in 1992\. [Today, 3.7 million students attend 8,100 public charter schools](https://publiccharters.org/?ref=bluegrassinstitute.org) across 44 U.S. states, Guam, Puerto Rico, and Washington, D.C. Each of the seven states neighboring Kentucky has public charter schools. During the 2022-23 school year, 299,059 students attended 803 public charter schools in those states. ### **Does Kentucky’s Constitution prohibit the creation of public charter schools**? No. An amicus brief authored by former Solicitor General Chad Meredith and submitted to the Kentucky Supreme Court by the Bluegrass Institute challenges a lower court [ruling](https://www.documentcloud.org/documents/24214199-hb-9-circuit-court-ruling?responsive=1&title=1&ref=bluegrassinstitute.org) declaring charter school legislation passed in 2022 unconstitutional. [Bluegrass Institute Charter Schools Amicus BriefThe relevant portion of our state constitution places no limitations on general fund appropriations.Amicus Brief Charters 2024.pdf486 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2025/09/Amicus-Brief-Charters-2024.pdf "Download") [House Bill 9](https://apps.legislature.ky.gov/law/acts/22RS/documents/0213.pdf?ref=bluegrassinstitute.org) established funding for charters and created a pilot program requiring local school boards in Jefferson County and Northern Kentucky to authorize at least one charter school in their respective areas. The brief asserts that the Kentucky Constitution does not restrict the General Assembly's power to allocate General Fund appropriations to public charter schools. It emphasizes that [Section 184](https://apps.legislature.ky.gov/Law/Constitution/Constitution/ViewConstitution?rsn=214&ref=bluegrassinstitute.org) limits new taxation methods rather than dictating specific appropriation policies. It also maintains that such funding aligns with the state’s constitutional obligation to deliver an efficient and diverse educational system. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/09/336534923_608600504027224_3332768792777464849_n-1-1.jpg) ## Education Freedom Updates Freedom-forward ideas for the commonwealth Subscribe Email sent! Check your inbox to complete your signup. No spam. Unsubscribe anytime. ### Kentucky Supreme Court schedules hearing on landmark charter school case URL: https://www.bluegrassinstitute.org/kentucky-supreme-court-schedules-hearing-on-landmark-charter-school-case/ Last updated: 2025-09-04T20:22:06.000Z FRANKFORT, Ky. –The Kentucky Supreme Court will hear oral arguments in a pivotal case that could enable the creation and funding of public charter schools in the commonwealth, offering families here an educational option available in 45 other states. The case, [Commonwealth of Kentucky, Ex Rel Attorney General Russell Coleman and Gus LaFontaine V Council for Better Education, Inc. et al.,](https://kentuckylantern.com/wp-content/uploads/2023/12/638379008938376450.pdf?ref=bluegrassinstitute.org) is scheduled for September 11 at 10 a.m. EDT in Newlin Hall at the Norton Center for the Arts. The proceedings will be live streamed on Kentucky Educational Television’s website [here.](https://ket.org/legislature/archives/2024/interim/interim-joint-committee-on-appropriations-revenue-7nq92f?ref=bluegrassinstitute.org) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/09/336534923_608600504027224_3332768792777464849_n-1-1.jpg) ## Bluegrass Education Freedom Updates Freedom-forward ideas for the commonwealth Subscribe Email sent! Check your inbox to complete your signup. No spam. Unsubscribe anytime. “It’s extremely heartening that the Kentucky Supreme Court will finally hear this monumental case,” said Jim Waters, president of the Bluegrass Institute. “After years of waiting, parents may finally gain access to charter schools, allowing them to choose the education that best fits their children’s needs.” The case originates from a lawsuit filed in January 2023 by the Council for Better Education, a group of school superintendents opposed to education freedom, along with two local school boards. They argue that [House Bill 9](https://apps.legislature.ky.gov/record/22rs/hb9.html?ref=bluegrassinstitute.org), passed by the General Assembly in 2022 to fund public charter schools and mandate pilot charters in Jefferson County Public Schools and Northern Kentucky, is unconstitutional. In December 2023, Franklin Circuit Judge Phillip Shepherd ruled against the legislation, a decision the Bluegrass Institute’s [amicus brief,](https://9562cdad-4c23-42af-b234-fa2550d0113d.usrfiles.com/ugd/9562cd%5Fa2a7109204d541aaa2e768510ad636ef.pdf?ref=bluegrassinstitute.org) authored by former state Solicitor General Chad Meredith, considers flawed because it focuses on whether charter schools are “common schools” under [Section 184](https://apps.legislature.ky.gov/Law/Constitution/Constitution/ViewConstitution?rsn=214&ref=bluegrassinstitute.org) of the Kentucky Constitution, rather than addressing the legislature’s authority to fund such schools using the state’s General Fund. **Key points from the brief include:** - Section 184, established during the 1891 Constitutional Convention, limits the power to raise new taxes but does not restrict General Fund appropriations. - The [Kentucky Constitution](https://apps.legislature.ky.gov/law/constitution?ref=bluegrassinstitute.org) does not prohibit funding charter schools with General Fund dollars, regardless of their classification as “common schools.” - Historical and current legislative practices support funding diverse educational programs across Kentucky, including magnet schools and the Gatton and Craft academies, which do not align with Shepherd’s definition of a “common school.” - Public charter schools align with [Section 183](https://apps.legislature.ky.gov/Law/Constitution/Constitution/ViewConstitution?rsn=213&ref=bluegrassinstitute.org)’s mandate for an “efficient system of common schools” by providing competition and are remarkably successful in improving public education in other states. In April 2024, the Kentucky Supreme Court granted the Attorney General’s request to transfer the case, bypassing the Court of Appeals. “A favorable ruling would mark a new era for education freedom in Kentucky,” Waters said. “It would empower families and enhance educational opportunities across the commonwealth.” ### *Bluegrass Institute works with Kentuckians, grassroots organizations, and business owners to advance freedom and prosperity by promoting free-market capitalism, smaller government and defense of personal liberties.* ### Kentucky data centers bring high-paying jobs and more tax income. Welcome them. URL: https://www.bluegrassinstitute.org/kentucky-data-centers-bring-high-paying-jobs-and-more-tax-income-welcome-them/ Last updated: 2025-09-05T17:15:07.000Z Kentuckians, like all Americans, are driving ever-growing demand for data stored in the “cloud,” and Kentucky is now poised to attract the billion-dollar data centers that make the cloud possible. New data centers are under construction across the country, but whether they locate here is up to local communities and public utilities. When you consider the benefits of construction projects, high-paying tech jobs and new property taxes, Kentucky communities should welcome them. America’s tech industry is number one when it comes to investing in our communities and future. In 2023, three of America’s top four capital investment leaders spent [$86 billion to build new data centers](https://www.progressivepolicy.org/wp-content/uploads/2024/09/PPI%5FInvestment-Heroes-2024-V7.pdf?ref=bluegrassinstitute.org) – far more than our energy, telecom, pharma or manufacturing sectors. The exploding demand should come as no surprise: each of us using a smartphone or computer look to the cloud to store our photos, videos, music, documents and messages – and since we rarely delete old items, our storage needs just keep growing. Nearly every business in Kentucky uses the cloud, too, for hosting applications and customer interfaces. U.S. tech is building data centers to serve *our* needs – not their own internal needs. Moreover, AI innovation requires even more data centers, and America needs AI to grow our economy, increase productivity and get ahead of China. But data centers can be located anywhere in the country. That’s why Kentuckians using cloud storage and computing right now are relying on servers located outside the commonwealth, without worrying about capacity or transmission. Given that data centers can be anywhere, they locate where they are welcomed by local communities and where utilities have power to spare. But a warm welcome isn’t enough to attract a billion-dollar investment – if the data servers, AI chips and related equipment are subject to costly state sales tax. In fact, no hyperscale data center has been located in a state that imposes sales tax on servers and equipment: enterprise data centers typically upgrade all their servers in each data center every 4-5 years, so sales tax would add millions to their costs. Fortunately, Kentucky recently extended its [sales tax exemptions](https://www.stites.com/resources/client-alerts/kentucky-vastly-expands-data-center-tax-incentives/?ref=bluegrassinstitute.org) to treat data center equipment the same way it treats business machinery bought by Kentucky farmers, ranchers, manufacturers and miners. Taxpayers rightly don’t complain about subsidies or “tax breaks” when a local manufacturer doesn’t have to pay sales tax on new machinery or when a farmer doesn’t have to pay sales tax on a new harvester. By the same token, sales tax exemptions for business machinery in every industry should be broadly supported since that’s how new investment happens. The operators of hyperscale data centers don’t typically ask for any taxpayer-funded improvements or economic development grants. In fact, data centers generate new payroll and income taxes and pay substantial property taxes in the communities they support – [$895 million in Loudoun County, Virginia county last year.](https://wjla.com/news/local/loudoun-county-virginia-taxes-data-centers-new-restrictions-budget-supervisors-board-kershner-data-center-revenue-new-positions-estimated-millions-operating-money-politics?ref=bluegrassinstitute.org) These are taxes that will not be paid if data centers stay away from Kentucky. While data centers pay directly for new utility connections and substations, residents and regulators rightly question how new, large data centers may affect electricity rates. For that, look to the experience in states where utilities serve lots of data centers. Northern Virginia has more data centers than any place in the world, and a [state audit last y](https://jlarc.virginia.gov/landing-2024-data-centers-in-virginia.asp?ref=bluegrassinstitute.org)ear found that ratepayers are *not* footing the bill for data centers and that the state has the tools to continue to ensure ratepayer protection. This year, a leading Missouri utility [said](https://www.kslegislature.gov/li/b2025%5F26/committees/ctte%5Fs%5Fcmrce%5F1/misc%5Fdocuments/download%5Ftestimony/ctte%5Fs%5Fcmrce%5F1%5F20250130%5F08%5Ftestimony.html?ref=bluegrassinstitute.org), “Because of their large volume electricity use, these large load customers, including data centers, absorb a greater share of the fixed costs of operating grid infrastructure (power plants, poles and wires), thus lowering rates for all customers.“ Kentucky stands at a pivotal moment with the chance to attract significant investment and high-tech jobs through data center development. By welcoming them, a Kentucky community could add [160 high-tech jobs that pay six-figures](https://jamesmadison.org/digital-foundations-the-essential-guide-to-data-centers-and-their-growth/?ref=bluegrassinstitute.org#economic-impact-of-data-centers) for local high school and trade school grads. On top of that, a community will add millions in local property taxes for decades to come. More data centers are surely coming to America, so Kentucky communities should consider embracing this great opportunity for high-tech economic development. *Steve DelBianco is president & CEO of* [*NetChoice*](https://netchoice.org/?ref=bluegrassinstitute.org)*, a national trade association for America’s leading tech companies, dedicated to protecting free enterprise and free expression online.* *This op-ed was first published on Aug. 16 in the Louisville Courier-Journal.* ### Kentucky's fines and fees system incarcerates the poor on the taxpayer's dime URL: https://www.bluegrassinstitute.org/kentuckys-fines-and-fees-system-incarcerates-the-poor-on-the-taxpayers-dime/ Last updated: 2025-09-17T18:41:53.000Z Imagine this: A young father in rural Kentucky, working two part-time jobs, gets a traffic ticket for expired vehicle registration. He can’t pay the fine in full, so he’s assessed additional court fees, late penalties and collection surcharges. He misses one hearing because his shift at the factory runs long, and a warrant is issued for failure to appear. Before he knows it, a $75 ticket spirals into thousands of dollars in court debt that he and his family can’t escape. What happens next? He loses his job. Then his license. Ultimately, he loses his freedom. Behind bars in the county jail, his stay is logged at $47 per day — on the taxpayer’s dime — and wipes away his debt at $50 per day, relieving him of any real obligation to repay. This isn’t a rare story. It’s business as usual in Kentucky’s criminal fines and fees system — and it’s not a conservative solution for public safety. Kentucky’s fines and fees model may sound like personal accountability on paper. In practice, however, it’s a government bureaucracy that punishes poverty, creates endless red tape and costs taxpayers more to enforce than it collects. In a [new report](https://kypolicy.org/the-hidden-web-of-criminal-legal-system-fines-and-fees-in-kentucky/?ref=bluegrassinstitute.org) by the Kentucky Center for Economic Policy, it’s estimated that our state spends more than 40 cents to collect every dollar in fines and fees — an administrative burden that should make every fiscal conservative cringe. Compare that to the IRS, which spends just [34 cents for every $100 it collects](https://news.clemson.edu/new-irs-funding-boosted-tax-enforcement-and-improved-taxpayer-services-during-the-biden-administration/?ref=bluegrassinstitute.org#:~:text=Notably%2C%20the%20IRS%20spent%20only%2034%20cents%20for%20every%20$100%20collected%20through%20audits.). That’s not a typo. While our commonwealth is responsibly charting the course to zero individual income tax, it cannot keep wasting money trying to extract payment from people who simply don’t have it. Some might argue taxes are more certain than court debt, and that’s true. But while the IRS uses audits and letters, Kentucky uses incarceration. And unlike the IRS — which rarely cancels debt — the court system cancels debt for jail stays and doesn’t even maintain a centralized database to track how much is owed, to whom, or how effectively it’s collected. There will never be a problem in a system that doesn’t have to report the details of its operations — but I don’t know a lawmaker who would read this report and say, “Yes, this is an effective means of ensuring personal responsibility and the best way to treat our most impoverished Kentuckians.” Let’s talk about the cost of criminalizing court debt. When we jail people for failing to pay fines and fees, we’re not just wasting tax dollars — we’re sanctioning what amounts to a modern-day debtor’s prison, something the 14th Amendment was supposed to abolish nearly two centuries ago. Our current system cancels a Kentucky offender’s debt at [$50 a day](https://kypolicy.org/the-hidden-web-of-criminal-legal-system-fines-and-fees-in-kentucky/?ref=bluegrassinstitute.org#:~:text=Kentucky%20statutes%20allow%20individuals%20to,day%20they%20remain%20incarcerated;%20or), rewarding nonpayment with incarceration, while charging the law-abiding taxpayer $47 a day to house each offender. Meanwhile, second-order damage to families, employers and communities who depend on the incarcerated Kentuckian is ignored, while for-profit corporations rake in money from behind bars — charging $8.25 for a hairbrush that costs $1.25 at Dollar Tree and nearly $43 for a bra you could buy for $8 on Amazon. Public pain becomes private profit, and counties become financially dependent on a broken system. That’s why some jails and local governments are resistant to change — they’ve come to rely on the fees and reimbursements tied to incarceration. But if the only way to keep a budget afloat is to jail the poor and churn court debt, then the budget is the problem —not the people. No one is suggesting that breaking the law should have no consequences. Every offender must be held accountable. But punishments should fit the crime — and a person’s capacity to pay associated fines and fees must be considered. A justice system that traps people in poverty, destroys families and burns through taxpayer dollars while failing to improve public safety is not conservative — it’s counterproductive. None of us wants to coddle lawbreakers, but lawmakers must recognize that Kentucky’s fines and fees system is broken. We need a smarter, leaner system — one that reports everything accurately and consistently. A conservative solution protects Kentucky taxpayers, upholds individual responsibility and ensures the punishment fits the crime. *Joey Comley is the Kentucky director of Right On Crime.* *This op-ed was originally published in the Louisville Courier Journal.* ### Kentucky families deserve expanded enrollment opportunities URL: https://www.bluegrassinstitute.org/kentucky-families-deserve-expanded-enrollment-opportunities/ Last updated: 2025-08-12T21:05:55.000Z Kentucky families face limited school choices due to restrictive public education policies. A 2022 court ruling blocked tax-credit scholarships, hindering educational freedom. Expanding enrollment options could enhance academic outcomes and empower parents to choose the best schools for their children. For too long, Kentucky’s families have faced a public education system that limits their ability to choose the best schools for their children. In 2022, the Kentucky Supreme Court ruled the state’s newly minted tax credit scholarship program [unconstitutional](https://apnews.com/article/education-kentucky-941dfb681aa1222005f8408923a8f9f7?ref=bluegrassinstitute.org), upending efforts to expand school choice. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/08/shutterstock_2490871645-1-1.jpg) However, state policymakers can expand students’ schooling options by strengthening Kentucky’s open-enrollment law, which allows students to transfer to public schools other than their assigned ones. Enacted in [2021](https://apps.legislature.ky.gov/record/25rs/hb563.html?ref=bluegrassinstitute.org), this law required school districts to adopt cross-district transfer policies. But it falls short in removing barriers and enabling parents to choose a public school in another district that best fits their children’s needs. For instance, the current policy allows districts like [highly rated](https://reportcard.kyschools.us/kysrc?organization=20232024:006:006000&ref=bluegrassinstitute.org) Anchorage Independent to establish enrollment policies that accept [no transfers](https://www.education.ky.gov/districts/enrol/Pages/Nonresident-Student-Policy.aspx?View=Non-Resident%20Policy&Title=Non-Resident%20Policies&Page=0&ref=bluegrassinstitute.org) even when seats are available. Other districts, such as [Jefferson](https://www.education.ky.gov/districts/enrol/Pages/Nonresident-Student-Policy.aspx?View=Non-Resident%20Policy&Title=Non-Resident%20Policies&Page=2&ref=bluegrassinstitute.org) County, permit transfers only under restrictive conditions, such as living in a specific geographic area or having parents employed by the district. A stronger policy would ensure Kentucky students can transfer to any public school with open seats, prohibit districts from charging tuition and improve transparency, making the process more family-friendly. Kentucky’s reluctance to fully embrace this policy by prioritizing district control over parental choice has resulted in one of the nation’s weakest open-enrollment policies. According to a [2024 Reason Foundation report](https://reason.org/open-enrollment/2024-public-schools-without-boundaries/?ref=bluegrassinstitute.org), only [eight states have weaker policies than Kentucky. ](https://reason.org/open-enrollment/2024-public-schools-without-boundaries/?ref=bluegrassinstitute.org) Despite these barriers, parents across the Bluegrass State are seizing upon the limited choices available. A recent Bluegrass Institute report shows nonresident transfers have [increased by 10%](https://www.bipps.org/top-reads/kentucky's-open-enrollment-policies-lag-behind%2C-limiting-educational-choice%2C-opportunities?ref=bluegrassinstitute.org) since the passage of HB 563 in 2021, with over 2,500 additional public-school students enrolling in a different district. In addition, enrollment at the Kentucky Virtual Academy (KYVA) more than doubled to over 3,000 students in the 2024-25 school year, its second year – up from 1,300 in 2023-24\. Combined, Kentucky’s nonresident student enrollment has grown by more than 16% since 2022, signaling strong parental demand for public-education alternatives. About 5% of Kentucky’s students currently attend public schools other than their assigned ones. However, states with robust open-enrollment laws see higher participation rates, averaging [one in ten students](https://reason.org/commentary/open-enrollment-laws-key-to-public-school-choice/?ref=bluegrassinstitute.org), compared to just 5% in states with weak policies, according to a [2025 Reason Foundation report](https://reason.org/policy-study/k-12-open-enrollment-by-the-numbers-2025/?ref=bluegrassinstitute.org). In Colorado and Arizona, for example, [28%](https://reason.org/policy-study/k-12-open-enrollment-by-the-numbers-2025/?ref=bluegrassinstitute.org) and [14%](https://reason.org/policy-study/k-12-open-enrollment-by-the-numbers-2025/?ref=bluegrassinstitute.org) of students, respectively, attend traditional public schools other than their assigned ones. In December, the Kentucky Board of Education approved a regulation that would have immediately closed the fast-growing virtual academy, forcing thousands of students to return to schools that had failed them or to find other options. Lawmakers responded during this year’s General Assembly by passing legislation pausing the regulation for at least three years, allowing the KYVA to demonstrate academic improvement. Strengthening Kentucky’s student-transfer policies would further empower families with the freedom to choose public schools – whether traditional or virtual – that best meet their children’s unique needs. [Legislation](https://apps.legislature.ky.gov/record/25rs/HB440.html?ref=bluegrassinstitute.org) introduced in recent General Assembly sessions offers a blueprint to improve Kentucky’s student-transfer policy by: - Ensuring students can transfer to any public school with available seats. - Eliminating tuition for nonresident students to ensure access for all families, regardless of income. - Requiring districts to publish clear information on capacities, vacancies and application processes, alongside detailed reports on enrollment and denials. - Establishing a fair appeals process for transfer denials to protect parental rights. By removing barriers and embracing transparency, Kentucky can join [16 states](https://reason.org/open-enrollment/2024-public-schools-without-boundaries/?ref=bluegrassinstitute.org) like Arizona and Florida in leading on open-enrollment policies, ensuring every child in our commonwealth has access to a public education that sets them up for success. *Jude Schwalbach is a senior policy analyst at the Reason Foundation. Jim Waters is president of the Bluegrass Institute for Public Policy Solutions.* ### What does a new federal tax credit mean for school choice in Kentucky? URL: https://www.bluegrassinstitute.org/what-does-a-new-federal-tax-credit-mean-for-school-choice-in-kentucky/ Last updated: 2025-09-08T19:53:29.000Z Kentucky’s students lack school choice, but a federal tax credit for scholarship donations could change that. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/08/shutterstock_2036186297-2.jpg) For a long time, Kentucky has been one of the only states to systematically deny K-12 students meaningful school choice options, but that could finally change thanks to the recent federal budget reconciliation package. The One Big, Beautiful Bill includes a provision offering a federal tax credit to individuals who make private donations for scholarship programs that help eligible students access a variety of education services, including private school tuition. Scholarship tax credit programs like this already exist in 21 states and are appealing because they use private, not public, dollars. The government already provides a host of other popular tax credits and deductions to encourage other forms of charitable giving or spending for the common good. States will have to opt in to allow their residents to participate in the program, and the Kentucky legislature should act as soon as they are in session next year to make our state’s students eligible. If they leave it up to Governor Beshear, he will surely deny Kentuckians this life-changing option, given his long-standing opposition to letting low-income families have alternatives to their assigned public school. Beshear and the enemies of education freedom will likely point to last year’s failed ballot amendment as an excuse for Kentucky to stay out of the federal scholarship program and maintain its public-school monopoly on working class families. Amendment 2 addressed a problem created by state courts which had erroneously interpreted the Kentucky constitution as prohibiting school choice. If it passed, Amendment 2 would have simply given the legislature the opportunity to do their job: setting education policy for the state and potentially joining the 48 other states that provide some mechanism to give low-income families the same opportunities to choose a school for their children that affluent families already enjoy. Email newsletter signup Sign up for our daily email newsletter Sadly, Amendment 2 was defeated. The convoluted nature of the proposal – amending the constitution so that the legislature could consider some yet-to-be-determined policy for the future – was understandably confusing to voters. But Amendment 2 also failed because the state’s school districts used their immense influence over public school employees to falsely threaten them with job losses and millions of dollars of education spending cuts if the initiative passed. The sheer quantity of misinformation spread by public school leaders was impossible to combat, and too many public-school employees persuaded their friends and family members to vote no on Amendment 2, depriving options to tens of thousands of students stuck in chronically low-performing schools. The bottom line is that voters – even if they hold a majority – should not be able to deny their fellow citizens the dignity of choosing a school for their children. As Colleen Hroncich and Neal McCluskey of the Cato Institute wrote last year, “Education choices should not be based on majority rule. It is simply wrong to compel families to pay for, and de facto attend, government schools – places intended to do nothing less than shape human minds – that they find subpar, or even morally unacceptable, even if the majority is okay with them.” It’s time for the Kentucky legislature to give our students the same privileges enjoyed by children in states all around us. *Bluegrass Institute scholar Gary Houchens, Ph.D., is director of the educational leadership doctoral program at Western Kentucky University. This op-ed was originally published in the* Bowling Green Daily News*.* ### Making Room for the Next Generation of Kentuckians URL: https://www.bluegrassinstitute.org/housing-testimony-to-the-interim-joint-committee-on-local-government/ Last updated: 2025-09-15T00:15:58.000Z Bluegrass Institute scholar M. Nolan Gray testifies on Kentucky's housing reform opportunity before the Interim Joint Committee on Local Government on July 29, 2025. ### Bluegrass Institute scholar Nolan Gray testifies before the Kentucky Housing Task Force URL: https://www.bluegrassinstitute.org/bluegrass-institute-scholar-nolan-gray-testifies-before-the-kentucky-housing-task-force/ Last updated: 2025-07-24T00:17:17.000Z The Bluegrass Institute's Nolan Gray discusses the most important issue facing Kentucky for the foreseeable future: housing. This is his testimony before the Kentucky Housing Task Force on June 30, 2025. ### Testimony to the Kentucky Housing Task Force URL: https://www.bluegrassinstitute.org/testimony-to-the-kentucky-housing-task-force/ Last updated: 2025-10-09T19:54:38.000Z *Remarks delivered to the Kentucky Housing Task Force on June 30, 2025.* ### **Introduction: 'I'm coming to you from the future'** Thank you, Mr. Chair, and thank you to members of the task force for the privilege to speak this afternoon. I'm joining you from out here in California. Why is a California housing policy wonk speaking to a Kentucky task force? Other than the fact that I was born and raised in Kentucky, an eighth-generation Kentuckian, I love Kentucky and want to see it succeed. I'm coming to you from the future in California, a state that has let housing affordability problems fester for decades. And I don't want that to happen to Kentucky. The unfortunate news is that if you want to turn into California, the solution is to do nothing. ### **Kentucky's housing crisis risk** As your excellent staff reported in their presentation previously, Kentucky is on track to have a California-style housing crisis if we don't take action today. As in the rest of the country, home prices went up by something on the order of 50% to 60% over the past five or so years in Kentucky. And these prices are going to continue to go up given the state's economic competitiveness and increasing population. Median home prices as a multiple of median household incomes continue to rise in cities like Lexington, where I'm from, and Bowling Green. The median home price is now at or above five times the median household income, meaning that the typical family increasingly has no path to home ownership. Instead, they're stuck renting, and a large and growing share of Kentucky renters are spending a third or even—in some cases—half of their income on rent. And then in the most extreme cases, of course, when you've got renters who are spending such a huge share of their income on rent, any sort of economic instability — the loss of a job, unexpected medical payments — can throw those households into homelessness. And again, we see the state continuing to set unfortunate records on homelessness. Again, what does this look like? We put the average Kentucky family increasingly in a situation where they have no path to home ownership. They're spending most of their income on rent, and anything going wrong can send them into a situation where they're living out of an extended-stay hotel, living out of a car, or, in the worst cases, living in a shelter or on the street. ### **Economic implications** This is all especially important given how economically competitive Kentucky is; lots of jobs are moving to the state, and that's an exciting thing. But if we don't build the homes needed to accommodate that high and rising workforce, folks are going to feel the pain, especially the folks who already live in Kentucky as higher-income families move in and bid up the price of housing. From the outside looking in, Kentucky is on the California trajectory, and we want to avoid that. The good news is we have plenty of time to avoid a California-style housing crisis. ### **Supply-and-demand mismatch** We know the root of the problem is a mismatch between supply and demand. When we survey the academic literature, when we do empirical analysis of this, we know that cities, counties, and states that are building a lot of housing relative to their peers are seeing housing prices relatively muted in their increases. And what that does is that allows the public dollars that are spent on deed-restricted affordable housing or special forms of housing for particularly vulnerable populations — those dollars go a lot further. But if we're in a situation where teachers, police officers, nurses, and supermarket clerks can't remain stably housed without needing subsidy, we're never going to have enough dollars to solve the problem. Now when we talk about housing affordability, I talk to a lot of folks, and they say, "Well, the problem is high interest rates, the problem is federal budget changes, the problem is tariffs." Those things are all huge, huge problems. But of course, you all as state legislators have no control over what happens with those policies. ### **State-level solutions** But one of the things we can control is making sure that it's easy and relatively predictable to get a permit for the types of housing that states like Kentucky need to remain affordable. In Kentucky, as in so many other parts of the country, a thicket of restrictive rules, slow and unpredictable permitting, and high construction costs that are a function of state and local policies have put us in a situation where even if some of those other federal and international issues get resolved, we're not going to be able to achieve housing affordability. I would flag some of the most impactful things that you can do don't necessarily involve spending a lot of taxpayer dollars — I know that's a sensitive issue — and they can often have bipartisan buy-in. Indeed, I think one of the most important things we can do to improve housing affordability is to restore property rights and allow folks to use the land that they own to add the housing that our state needs. Unfortunately, Kentucky has increasingly fallen behind on a lot of these regulatory reforms. I'm going to talk about three general buckets. And I think this complements what your staff iterated in their previous comments. ### **Zoning reform** The first is that in many cities and counties, local zoning often simply doesn't allow the types of housing that a state like Kentucky needs to get built. You know, when I say starter home, I think a lot of folks imagine a single-family home, two-car garage on a 10,000-square-foot, maybe even a half-acre lot. But for many households in 2025, a starter home might look like a townhouse. It might look like a condo in a small apartment building. It might look like a duplex where they can rent the other unit out and use that rent revenue to pay down their mortgage. Unfortunately, in many cases, the zoning rules simply don't allow that. But I'm going to be stressing solutions here. In recent years, the state of Florida has legalized housing in commercial zones. So in many parts of the country, housing cannot legally be built in any commercial zone. So you have a half-empty strip mall or you have a half-empty office park — something that might realistically never be leased out in an age of remote work. What Florida said was if an applicant can build workforce housing on that site, they should be allowed to do that consistent with a reasonable density and height that reflects the local conditions. And if they can make that specifically workforce housing, they should be entitled to a property tax abatement to make sure that that pencils. We've not had a full report out on that yet because that's been in recent years. But it seems like the Live Local Act has helped to facilitate something on the order of 10,000 units in the pipeline at a period when construction is falling for a variety of reasons. There aren't a lot of happy stories here out of California, but one of the successful things that we've done has been legalizing accessory dwelling units. These are sometimes called mother-in-law units or granny flats. These are additional units that a homeowner can add to their property, in many cases called mother-in-law units for aging parents or to keep young adult children close by while they save up for a downpayment. That's partly why these ADUs have been so popular among groups like AARP, providing homeowners with options and flexibility to add additional units. Prior to 2017, ADUs were illegal to build almost everywhere in California. And we've passed legislation to empower homeowners and small property owners to add ADUs. And that's facilitated something on the order of 100,000 ADUs being built. That's 100,000 new homes that were built at no cost to the taxpayer that previously had been illegal. And in many cases, homeowners are adding these ADUs, getting an additional source of income, and they're achieving housing stability. ### **Streamlining permitting** In addition to zoning allowing for housing to be built, I always say, "It's all well and good if the zoning allows the housing to be built, but if it takes months or years to get a permit, if it's a long and unpredictable process, it might as well not be legal." Something that a few states have done in recent years — Tennessee, Florida, Texas, three states that I'll be highlighting pretty regularly here — have allowed for, in cases where the city or the county is delayed in issuing the permit or conducting the inspection, the applicant can hire a licensed third-party professional to do that work to move the process along. That's absolutely key, especially for smaller projects. If there's a lot of unpredictability in permitting, if it could be two weeks or two months and you don't know or two years to get all of your entitlements and permits, that can really imperil projects and especially smaller projects built by small local developers who might not have an attorney or a planner full-time on staff. So, making it really, really easy to get through the process is absolutely key. ### **Cost containment** Then the third bucket I think that's really, really important is cost containment. Ensuring that the government isn't needlessly imposing a bunch of rules and regulations that force housing prices to be higher than they need to be. You know, there are rules related to health and safety that might increase costs, but that's just necessary. But to the extent that we're increasing housing costs without any basis in health and safety, those are areas where we can improve. Returning to Texas, just earlier this year, they passed SB 15, which was a priority of their lieutenant governor, to allow for smaller-lot single-family homes, allowing homeowners to get in on the ladder of home ownership by purchasing a home on a slightly smaller lot. That's absolutely key given how land prices continue to rise in high-demand contexts. Alternatively, in Arkansas, they passed legislation preempting high local building-material mandates that forced developers to use building materials that were much more expensive than what would have potentially been allowed under the state building code. That was Act 446. Or North Carolina, eliminating parking mandates that forced, in many cases, projects to come with huge parking lots that were virtually never full, or large parking garages that could increase the cost of a new unit by $30,000, $40,000, or $50,000 per unit, providing consumers with the flexibility to purchase exactly the type of housing that meets their needs and providing developers the flexibility to provide it. ### **Conclusion: Kentucky's need, Kentucky’s opportunity** I would stress this: a lot of these reforms are necessary but not sufficient. Of course, we have to be planning for growth. We have to be lining up the public support for the infrastructure needed for additional housing, exploring the building code and other aspects of land-use regulation and housing regulation to make sure that we're allowing for the most affordable and safe forms of housing to be built. And Kentucky could easily be a leader on this issue without necessarily huge increases in public outlays or without necessarily big, complicated programs. You know, a lot of these reforms that I've highlighted and that we'll provide materials on in follow-up correspondence are letting the market provide the housing that our communities need. Again, I'm coming to you from the future. Decades of strict rules and costly mandates get you to a place like where California is today, where hundreds of thousands of people are leaving the state, where folks who have remained have no path to home ownership. They're doubling or tripling up in apartments. Folks are living in tents and cars. I desperately, desperately don't want that for my home state, and I would urge you to continue working on this issue, and I appreciate the leadership of the task force on this. Thank you. *Remarks delivered to the Kentucky Housing Task Force on June 30, 2025* ### A Libertarian Is the Only Real Egalitarian URL: https://www.bluegrassinstitute.org/a-libertarian-is-the-only-real-egalitarian/ Last updated: 2025-10-06T15:38:59.000Z A libertarian—which means a true “liberal” in the original sense of the word—wants a society with no human-made, involuntary ups and downs, no masters and slaves. That’s all there is to it. But what about equality? One reply is that the libertarian admires the varied gifts of humans: some have athletic prowess, some have wisdom in religion, and some have insight into commercially tested betterments, such as a new app or a new hip replacement. The libertarian therefore wants people to exchange their gifts for mutual advantage and mutual enlightenment. It amounts to free trade and free speech among free adults. Lovely. You know it works in rock music and friendship and the English language. Let’s have equal liberty of permission to venture, says the libertarian. Let’s not have governmental intervention in rock music, friendship, language … or the economy. Equality of permission. No masters with a clipboard or a regulation and the threat of a fine or imprisonment to back them up. The libertarian doesn’t think that the usual ideas about equality—equality of income or equality of opportunity—make a lot of sense. Instead, the libertarian wants that liberty of *permission*. The scientific fact is that equality of permission works, and it pretty quickly creates greater equality of incomes and opportunities. What the libertarian’s hero Adam Smith called in that revolutionary year 1776 “the obvious and simple system of natural liberty” lets anyone venture equally as an adult. Economic history shows that the new liberty of permission, which gradually widened during the two centuries after 1776, did in fact lead to other equalities—much better consumption and better parenting. The vastly more prosperous people alive now—30 times more prosperous, it turned out—end up reasonably equal in that they at least have the essentials of life, such as food and a roof over their heads and the like. Maybe they are not all equal in their ownership of jewelry and fast cars, but they are much more equal to the rich in the basics than in olden days. And the liberal equality of permission implied a spreading reluctance to beat children and neglect their educations, on the understanding that children, too, are equal persons whose custody is a trusteeship rather than a piece of property. If we try to get the other non-permission equalities directly, we don’t get them at all. Robbing Peter to pay Paul turns out to make us all poorer by driving Peter out of business, corrupting Paul, and giving Helen, the bureaucrat who runs the redistribution, such powers that she is tempted to misuse them in very nasty fashion. And equality of opportunity, which sounds nice, is impossible to achieve if you take it literally. You had better parents than Bobby, say. Should we forbid your parents from being better, or should we intervene to coerce Bobby’s parents to be better—or at least better in the opinion of Helen the bureaucrat? Say one person is smarter than another and speaks Spanish as well as English. So to make them equal at the starting line, should we drive nails into that first person’s head until they are as stupid as the second person, and they forget Spanish? You see the problem. The metaphor of an exactly equal starting line for a foot race is not the sensible, practical, doable, fair proposal. The sensible proposal is to let people race as they will. That way you get more runners, and immense innovation in the economy. It’s a fact of history after 1776. In the 1700s, this notion of letting people do what they want so long as they didn’t hurt others looked completely crazy. Everyone had a master and the master told you what to do. Eat your spinach. Stand still for a beating with a knout. No, Jews can’t go to law school. No, blacks can’t get a house loan after serving in World War II. The new libertarians/​liberals like Frederick Douglass (1818–1895), Mary Wollstonecraft (1759–1797), and Adam Smith (1723–1790) denied that a white owner should be the black slave’s master, or that a husband should be the wife’s master, or that the officials from the king or the Congress should be masters over us all. Each adult is to be their own master. As Adam Smith put it, a person should be “left perfectly free to pursue his own interest his own way.” Do your own thing, without force or fraud against others. You help others by doing carpentry or moviemaking or doctoring for pay. You again get the point: no artificial, involuntary masters are to order you about. Every adult should be free and should have equal dignity. Everyone is to be treated as having equal permission to try out things. New religions. New machines. New relations between men and women. That’s true liberalism. And you can see that it is strongly egalitarian, more egalitarian in fact than the impossible or unwise equalities that our good friends on the left propose. **Treating Adults as Adults** A six-year-old child of course needs a parent to make decisions. If the child decides to eat only potato chips, her mother needs to step in and make her eat her spinach. But as an adult, you are liberated to eat potato chips or spinach as you please. Good. True liberalism could therefore be called “adultism,” in just the sense we all declared angrily to our parents at some point, a little bit before actually becoming adults: “You’re not my boss!” Yet voluntary, temporary parents or bosses are indeed necessary to get some good things done such as raising children to responsible adulthood or getting a hamburger made and sold. When you’re paid to cook or sell or bus tables at McDonald’s, you follow whatever lawful order the boss issues. That’s the deal. You might tolerate a little jerky behavior from the boss if it’s not too bad. But if you really don’t like how you’re treated, or the wage that you are being paid, you can quit and go find another boss who will pay you adequately and who is not such a jerk. Or you quit and start your own business and, as a boss, you pay others to do carpentry or movie-making or doctoring. That happens tens of thousands of times a day. The good result of all this voluntary bossing and paying and leaving and entering is that hamburgers get served to people at reasonable prices. Carpentry and movies and doctoring are all available, too, as they are not in economies run on principles of nonpermission and involuntary service. We say to the soldier in uniform at the airport, “Thank you for your service.” We should say it to you and your boss at McDonald’s too. The obvious and simple system of natural liberty of permission is the most altruistic one, everyone busily doing services for others. So a boss under liberalism is not a master in the old, nasty, slavish, involuntary sense, the sense that every human society adopted before liberalism. Richard Rumbold was hanged at Edinburgh in 1685 for being a fierce liberal and plotting against the tyrannical king. Under British law he was permitted to make a statement from the scaffold before the executioner yanked the trap door open. “I am sure,” he said, “there was no man born marked of God above another, for none comes into the world with a saddle on his back, neither any booted and spurred to ride him.” To “no man” we can now add “no woman, no teenage child, no black, no colonial person, no sexual minority,” and on and on. Liberalism is different from every other political philosophy in just this way. A nonliberal socialist society, for example, elevates the central planners to positions of coercive bossiness over others. An old aristocratic society, likewise, elevates the dukes and barons. A coercively theocratic society (unlike, for example, a voluntarily conservative society of religion, such as you can see among the Mormons or the Amish) elevates the priests or ayatollahs. But a liberal society doesn’t elevate anyone at all, unless for temporary purposes of winning the football game or getting hamburgers made and sold, and only when that someone has shown that he or she deserves to be the quarterback or the boss— for the time being, or as long as enough people consent. **The Allure of Command and Control** In view of all this, why do young people keep saying, “Let’s try socialism”? They talk as though 1917 in Russia and the horrors after 1945 of a third of the world’s population being ruled by hideous socialist tyrants never happened. I do wish they wouldn’t. But here’s why. We are used to little families in which Mom and Dad ensure that hamburgers and educations and medical care are made and distributed among the children fairly. In other words, a family is a little socialist economy. Usually a good one. It sounds strange to say so, but consider: the socialist motto is supposed to be “from each person according to their ability, to each person according to their need.” Sweet. And in a family, that’s how things go. A good family, in the style of the *Little House on the Prairie*, is fair, equal, and as centrally planned as Russia was under communism. No wonder, in other words, that people coming to political consciousness around age 16 or 20 reach for socialism. Their little socialist families were all right. Why not try it in the society as a whole? But big societies can’t be organized like a sweet family. That’s a sad truth, like rain when you don’t want it. But there you are. Yes, a society can and should help out poor people and the disadvantaged, the way a father helps his little children. One of the five religious duties of a Muslim is to offer charity, and the same is true in Christianity and Hinduism, as well as for simple justice in any human society. It’s depressingly easy for a ruler in a boss society, like a tribe’s chief or a town’s mayor, to divert the nice charity collected by taxes to their own family. Most governments in the world—on the actual evidence as against wishful thinking—are more like the mafia than *Little House on the Prairie*. Think of Russia or Saudi Arabia. It would be wonderful if a big economy could be organized like a sweet family. Your mother didn’t make you go out at age six to earn money to pay for lunch, thank God. Markets should not be applied everywhere. But you can see that expecting farmers to provide beef for the hamburger at McDonald’s without payment, simply out of the goodness of their hearts, as though in a sweet family, isn’t going to work. Nor will you show up at McDonald’s to cook the hamburgers or bus the tables for free. And if McDonald’s starts offering hamburgers for free, the lines will be miles long. And, of course, the business will promptly close for good. St. Paul heard from the early Christian community he had set up in Thessaloníki that many people were not doing their jobs. They believed that the Second Coming of Christ and the end of history were about to happen any day, so you can understand their lack of interest in doing the dishes or baking the bread. St. Paul was annoyed and wrote to them pointing out indignantly that when he was with them he did his share of the work and declaring that “one who does not work, should not eat.” That’s how a large society in which free riding is possible has to work, if anyone is to eat. Put your shoulder to the wheel, and we’re all better off. Food and housing and education do not fall on people free from the sky. They have to be made by work. The pseudofairness in the old communist East Germany from 1949–1990 resulted in half the amount of work productivity of West Germany. The bitter joke in Eastern Europe under Russian-imposed socialism was, “They pretend to pay us, and we pretend to work.” **Capitalist Fairness** Yet isn’t capitalism unfair? Doesn’t it have a tendency to make the rich richer and poor poorer? No. In actual fact, the liberalism that spread after Douglass and Wollstonecraft and Smith was explosively good for the poor. The poor have been the main beneficiaries of the Great Enrichment since 1800\. The rich got richer, true. But meanwhile, the poor went from having little to eat to now having adequate— even excessive—food, from living in hovels to living in apartments with central heating and hot running water, from being almost entirely illiterate to being able to read instruction manuals and a billion websites, and from dying of cholera to having penicillin. In 1960 even a billionaire couldn’t buy a smartphone or a drug to fend off his clinical depression. Now poor people can have both. In other words, the Great Enrichment flattened out the inequality of safety and comfort. The poor, who were your ancestors and mine, got vastly richer. They are not, as Jesus claimed in a society of actual zero sum, always with us. But shouldn’t we now equalize incomes? No. Coerced equality of outcome, making the pay of a gifted surgeon or musician or entrepreneur the same as that of an unskilled worker, merely yields less for all of us. If inequalities in pay don’t encourage people to become surgeons or rock musicians or the next Sam Walton (founder of Walmart, from one little store in Bentonville, Arkansas), we don’t get those services. Without the signal a market gives—“For Lord’s sake, make more of this stuff that rose so much in price!”—we would remain as poor as people were in 1800. Want to see unfair? Go back to the divine right of kings, before liberalism. And if you seek the poor who are always with us in the modern world—although their absolute number is falling almost every year—look to the wretchedly poor in the wretchedly governed countries, such as Zimbabwe. Liberal markets slowly expanding in permissions after 1776 inspirited people to try new things, causing worldwide income to rise from $2 a day per person in 1800 at present-day prices to, on average, $45 a day now. That’s equality of real comfort. In the Slavic lands there is a traditional story about Jesus and St. Peter wandering in disguise at a poor peasant village, where they asked for an evening meal and a place to sleep. After many rejections, a generous couple helps them. The next morning Jesus reveals himself, and says to the husband, “For your charity I will grant you anything you wish.” The husband and wife consult with each other in whispers, and then the husband comes back to Jesus and says, “My neighbor has a she-goat that gives him milk every day …” Jesus anticipates, interjecting, “And you want me to give you a goat, too?” “No. We want you to kill the neighbor’s goat.” Envy and its accompanying talk about inequality is not a good basis for social policy. That’s if we want everybody to have goats. *This article originally appeared in* Cato Policy Report*.* ### Data centers' benefits fail to justify taxpayer subsidies URL: https://www.bluegrassinstitute.org/data-centers-benefits-fail-to-justify-taxpayer-subsidies/ Last updated: 2025-09-22T12:56:50.000Z In this age of artificial intelligence, could Kentucky’s elected officials be making some dumb decisions with taxpayer dollars when it comes to data-center subsidies? Rather than driving economic growth, could some of Frankfort’s economic development policies risk leaving Kentuckians worse off than before? Thanks in part to new tax breaks created last year, Kentucky has seen a slew of plans and proposals for giant data centers – mammoth buildings full of computers that run our cell phone apps, search engine queries, social media posts, credit card transactions and every other tool of the modern information age. There’s a huge demand for these facilities across the country, especially to meet the needs of new artificial intelligence tools. But just because they’re important doesn’t mean it’s intelligent for Kentucky’s governments to be shoveling millions – or eventually billions – of dollars in subsidies toward them. To be clear, government “economic development” subsidy programs are almost always a terrible idea. A vast amount of real-world evidence backed by decades of independent research from experts across the political spectrum makes it clear: governments don’t grow the economy when they hand out taxpayer-funded subsidies to a select few companies or projects. Companies make decisions about where to move and what to build based on a host of fundamental business factors. Government subsidies have little power to turn a bad site into a good one, create a workforce out of thin air or make it worth a company’s while to suffer through bad environmental rules, labor laws or other stifling regulations. Within this world of bad deals, data centers stand out for being especially abysmal tools for an economic-development strategy. In many ways, they’re what you might get if you sit down with a clean sheet of paper to design the worst-possible project to subsidize in the name of economic progress. To begin with, they’re unimpressive at job creation since they employ few people onsite. The high-value work enabled by data centers is being done by programmers in places like Silicon Valley, Shanghai and Mumbai, not in onsite offices. Data centers offer limited benefits to surrounding communities. They’re self-contained, high-security facilities that don’t have a lot of visiting customers or vendors who might patronize local restaurants, gas stations, convenience stores, dry cleaners or other businesses that benefit from such spillover traffic. They also do little business with local vendors. Almost all their expensive computers and networking equipment is imported from places like Taiwan, China and Mexico. Finally, and perhaps most importantly, data centers have an almost-insatiable demand for energy, to the point where their growth is the biggest issue currently facing America’s power grids. Last year, the U.S. Department of Energy estimated that data centers account for about 5% of U.S. electricity use, potentially doubling by 2028\. What could that mean for Kentucky’s communities? One single proposed “hyperscale” data center project in Louisville could use as much as 400 megawatts of power at full capacity. That’s enough energy to power roughly a tenth of the homes in the state, and it raises the obvious question: If the data center is using that power, where does the electricity come from to keep the lights on in those 200,000 homes? Will Kentucky’s utilities need to build more power plants paid for by their electrical customers through their utility bills? If that’s the case, taxpayers will pay twice: first to subsidize costly imported computers for data centers, then through higher electric bills to fund new power plants to run them – all to host businesses that create few jobs or economic benefits for local communities. Perhaps Kentucky should tell data centers: You’re as welcome here as any other industry – as long as you pay your own way. *Bluegrass Institute Scholar John C. Mozena is president of the Center for Economic Accountability. This commentary was first published in the Courier-Journal on June 16, 2025.* ### Congress should nix a regulatory bait-and-switch on hemp URL: https://www.bluegrassinstitute.org/congress-should-nix-a-regulatory-bait-and-switch-on-hemp/ Last updated: 2025-09-05T19:27:40.000Z Kentucky hemp farmer Jay Grundy is worried about his farm’s future. “We’re looking at about a half-million dollar investment into our operation, but with this change we could be on the verge of bankruptcy,” he said from his Marion County farm on a recent Saturday. The change that concerns Grundy is a proposed repeal of a portion of the 2018 Farm Bill. That bill brought almost the entire hemp plant back to prominence (and legality) for farmers. Now the U.S. House Appropriations Committee has endorsed a change that would reduce the amount of legally-allowed delta-9 THC from 0.3% to zero. For Grundy and thousands of other hemp growers, the market for their crops would be utterly destroyed. According to the [Kentucky Department of Agriculture](https://www.kyagr.com/marketing/hemp-overview.html?ref=bluegrassinstitute.org), the vast majority (87%) of hemp production in Kentucky is for extracts like CBD and other cannabinoids. Because even most non-intoxicating hemp products contain a trace amount of THC, the pending congressional change would wipe out virtually the entire regulated hemp-consumable market, leading to widespread farm closures and job losses. It would also federally recriminalize hemp products like full spectrum CBD oil, stripping access from millions of Americans, including [veterans](https://www.youtube.com/watch?v=d5ti78CEt%5F8&ref=bluegrassinstitute.org), [first responders](https://fox59.com/indiana-news/fire-department-sparks-conversations-after-allowing-staff-to-use-cbd-products-including-delta-8/?ref=bluegrassinstitute.org) and others who rely on them for relief of chronic pain. Hundreds of other Kentucky farmers moved into hemp after 2018, driven in large part by the belief that the hemp prohibition was finally and permanently over, that the regulatory changes would allow farmers to discover new markets and make new investments in this long-dormant Kentucky crop. “Our investments need a minimum of five to eight years to recover,” Grundy said. Kentucky farmers have weathered the rise and fall of tobacco and the changes that have come with it. Today, farmers are worried about other countries’ tariffs on their exportable farm goods. And, of course, every farmer must contend with uncertain market conditions, pests, weather and natural disasters. The regulatory uncertainty that Congress may foist upon them adds insult to injury. It’s no wonder that Kentucky Agriculture Commissioner Jonathan Shell strongly opposes the recriminalization of hemp products. “Kentucky’s farmers deserve stability and support as they work to grow and diversify their operations,” Shell said. “We’ve seen strong progress in hemp production, including significantly increased acreage from last year – an encouraging sign of the industry’s resilience and potential.” And it’s no coincidence that Texas Gov. Greg Abbott recently vetoed a similar effort to ban hemp products after strong public outcry. The proposed repeal would have significant impacts on Kentucky and beyond. Over the last 11 years, American farmers have rebuilt a domestic supply chain of hemp and hemp products since 2018\. [Whitney Economics](https://www.dropbox.com/scl/fi/hj1vqkrv3nypa495azfdk/2023-U.S.-National-Cannabinoid-Report-Whitney-Economics-Public-Facing-10-26-23.pdf?e=4&inf%5Fcontact%5Fkey=5385e7d3453fff3150d296616a31ef71&rlkey=8zuqessu0z9nb3jduvmpa397g&dl=0&ref=bluegrassinstitute.org) estimates that U.S. farmers today supply the raw materials for a hemp consumable market valued at $28.4 billion, supporting 328,000 jobs in agriculture and retail, generating more than $13 billion in employment impact and contributing $1.5 billion in state tax revenues. Hemp farmers and the hemp business industry aren’t looking for a handout. In fact, hemp industry leaders are trying to work with Congress to establish responsible, science-based consumer protections that would mean robust testing, transparent and factual labeling and packaging standards, and meaningful efforts to restrict the sale of intoxicating hemp products to those over 21. Beyond destroying the vast majority of the revitalized hemp industry, recriminalizing hemp would quickly shift demand to criminal enterprises that care far less about product quality or the age of their customers. Grundy says he’s hopeful that a happier resolution is possible. “As an industry, we want to get rid of the bad actors,” he said, “but we can do that without wiping this whole industry away.” *Jonathan Miller, a former Kentucky State Treasurer, is General Counsel of the U.S. Hemp Roundtable. Caleb O. Brown is CEO of the Bluegrass Institute.* ### Kentucky's open-enrollment policies lag behind, limiting educational choice, opportunities URL: https://www.bluegrassinstitute.org/kentuckys-open-enrollment-policies-lag-behind-limiting-educational-choice-opportunities/ Last updated: 2025-08-13T12:46:10.000Z LEXINGTON, Ky. — A new report by the [Bluegrass Institute for Public Policy Solutions](https://www.bipps.org/?ref=bluegrassinstitute.org) reveals that Kentucky's open-enrollment policies are among the weakest in the nation, restricting the ability of families to choose a different public school that better meets their children's educational needs. “Finding the right fit for children is important in their educational development and the best fit may not be with the local public school,” the report states, emphasizing the value of choice in K-12 education. The study,[ "Public School Open Enrollment in Kentucky: Policy Issues Regarding Non-Resident and Transfer Students](https://1fdf4a5b-1369-48e4-8e0f-7ad62dfd4c02.usrfiles.com/ugd/1fdf4a%5F0a177d8704a94fe8a3e0d12eb22cf9a7.pdf?ref=bluegrassinstitute.org)," is the final release in a three-part series of weekly policy briefs in May examining public education spending in the state. It highlights shortcomings in the commonwealth’s current open-enrollment policies which rank poorly; 34 states surpassed Kentucky in a 2024 Reason Foundation [study.](https://reason.org/open-enrollment/2024-public-schools-without-boundaries/?ref=bluegrassinstitute.org) Contributing to the state's weak performance are policies permitting school districts to impose strict limits on non-resident student admissions, charge tuition and maintain unclear open-enrollment processes. Since House Bill 563 passed in 2021, mandating districts to adopt open-enrollment policies, non-resident student numbers in Kentucky’s public schools have increased, with over 2,500 additional students joining across districts – a 10% rise. Independent districts lead in non-resident enrollment, with some, like Cloverport Independent, seeing explosive growth through online programs. In only its just-completed second year, enrollment in the [Kentucky Virtual Academy (KYVA)](https://kyva.k12.com/?expb=cro-q3-2025&ref=bluegrassinstitute.org) – an online public school available to students in each of the state's 171 districts – more than doubled. “This surge in the virtual academy’s enrollment underscores parents’ interest in educational opportunities,” Bluegrass Institute President Jim Waters said. “Kentucky families deserve the freedom to choose innovative public schools like the academy that meet their children’s unique needs.” Implementation of regulations approved in December by the Kentucky Board of Education that would have forced the academy to close immediately were delayed until at least 2028 by passage of [House Bill 241](https://apps.legislature.ky.gov/record/25rs/hb241.html?ref=bluegrassinstitute.org) during this year's legislative session. The Bluegrass Institute urged policymakers to give the program sufficient time to succeed. The report also compares current policy with [Senate Bill 210](https://apps.legislature.ky.gov/record/24rs/sb210.html?ref=bluegrassinstitute.org), introduced in 2024, which would have strengthened the state’s open-enrollment policy by requiring districts to: - allow open enrollment within and across districts, prohibiting them from charging tuition; - post their capacities and vacancies, along with a report; - establish the process and timing of the application, decision and appeals of denials; and - report non-resident enrollment, withdrawals, applicants, denials and the reason for the denial to the Kentucky Department of Education. It also reveals significant disparities: the 20 school districts with the highest non-resident enrollment are all independent yet account for over 25% of out-of-district students while constituting only 3.3% of the state’s total K-12 enrollment. In contrast, non-resident students make up less than 1% of enrollment in large districts, such as those in Jefferson and Fayette counties. *For more information, contact: Jim Waters, president of the Bluegrass Institute for Public Policy Solutions, at (270) 320-4376 or* [*jwaters@bluegrassinstitute.org*](mailto:jwaters@bluegrassinstitute.org)*.* --- Bluegrass Institute works with Kentuckians, grassroots organizations, and business owners to advance freedom and prosperity by promoting free markets, smaller government and defense of personal liberties. [Subscribe here](https://urldefense.proofpoint.com/v2/url?u=https-3A%5F%5Fwww.bipps.org%5Fget-2Dinvolved&d=DwMFaQ&c=euGZstcaTDllvimEN8b7jXrwqOf-v5A%5FCdpgnVfiiMM&r=GLJInpmArbTUTf3si54pRtDisnnp81vKvCHMrDNuP0Y&m=%5FqzBmNCRwIKUSHP3XASPbu9XZ2bWRFBGyBaj-mNWQxJvHDlDNwp0e3rSsIenHrml&s=gZeR9PwIgtwlC6vtd-YP0FGVD3Mqq4qrm9nAgh4Tl9k&e=&ref=bluegrassinstitute.org). ### Kentucky’s school-staffing trends: Only five states have worse share of teachers in K-12 URL: https://www.bluegrassinstitute.org/kentuckys-school-staffing-trends-only-five-states-have-worse-share-of-teachers-in-k-12/ Last updated: 2025-09-23T12:56:28.000Z “[Staffing Trends in Kentucky’s Public Schools](https://1fdf4a5b-1369-48e4-8e0f-7ad62dfd4c02.usrfiles.com/ugd/1fdf4a%5F640e6ec6c90d43529cbe45e2af28407c.pdf?ref=bluegrassinstitute.org)” is the second in a three-part series of Bluegrass Institute policy briefs examining public education spending in Kentucky. Written by economists Paul Coomes, Ph.D., and John Garen, Ph.D., the report highlights a surge in non-teacher staffing that’s most pronounced at the district level and a funding increase that continued after staffing levels plateaued. Key findings include: - Total school staffing in Kentucky’s K-12 education system grew 39% from 1990 to 2024, with non-teaching staff rising 57% compared to a 21% increase in teachers. - District-level staff increased 62% since 1993, far outpacing the 15% growth in school-level teachers, while student attendance dropped nearly 3%. - Despite a 10% decline in average daily attendance since 2013, per-pupil funding has soared an inflation-adjusted136% since 1990, increasing from $8,400 to $19,700, and has continued to rise even after non-teacher staffing plateaued in 2013. The research also reveals that only five states have worse teaching-to-nonteaching ratios than Kentucky. Six of Kentucky’s seven neighboring states have a higher share of staff who are teachers. For example, 55% of all public-school staff in Missouri are teachers in the classroom – fifth best in the nation – compared to only 43.5% in Kentucky. The [first report](https://1fdf4a5b-1369-48e4-8e0f-7ad62dfd4c02.usrfiles.com/ugd/1fdf4a%5F5133c173b2cd4c1ca8625204f6aa48e2.pdf?ref=bluegrassinstitute.org) in the series analyzed Kentucky public teachers’ compensation. ### Staffing Trends in Kentucky’s Public Schools URL: https://www.bluegrassinstitute.org/staffing-trends-in-kentuckys-public-schools/ Last updated: 2025-09-16T00:23:06.000Z This brief examines historical data on various types of employment in Kentucky’s public schools. Publicly available annual data on staffing is available on the Kentucky Department of Education (KDE) and the U.S. Department of Education websites, though there are some differences in definitions and scope of coverage. Key points: > Total school staffing in Kentucky’s K-12 education system grew 39% from 1990 to 2024, with non-teaching staff rising 57% compared to a 21% increase in teachers. > District-level staff increased 62% since 1993, far outpacing the 15% growth in school-level teachers, while student attendance dropped nearly 3%. > Despite a 10% decline in average daily attendance since 2013, per-pupil funding has soared an inflation-adjusted 136% since 1990, increasing from $8,400 to $19,700, and has continued to rise even after non-teacher staffing plateaued in 2013. [Staffing Trends in Kentucky’s Public SchoolsJohn Garen and Paul CoomesStaffingTrends051325.pdf732 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2025/09/StaffingTrends051325.pdf "Download") ### Public School Open Enrollment in Kentucky: Policy Issues Regarding Non-Resident and Transfer Students URL: https://www.bluegrassinstitute.org/public-school-open-enrollment-in-kentucky-policy-issues-regarding-non-resident-and-transfer-students/ Last updated: 2025-11-15T21:13:08.000Z [Public School Open Enrollment in Kentucky: Policy Issues Regarding Non-Resident Kentucky permits districts to impose strict limitations on non-resident enrollment.2025OpeningTransferPolicies.pdf502 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2025/11/2025OpeningTransferPolicies.pdf "Download") In 2021, Kentucky lawmakers required public school districts to establish non-resident enrollment policies and report them to the Kentucky Department of Education, representing a modest step toward expanded access. This report examines Kentucky's open enrollment policies, which allow K-12 students to attend public schools outside their assigned district. Kentucky's open enrollment framework is poorly rated compared to other states. The commonwealth permits districts to impose strict limitations on non-resident enrollment, charge tuition, and maintain opaque policies with minimal data collection and transparency. Following implementation of the requirements imposed in 2021, non-resident enrollment increased from 4.11% to 4.48% of all students (excluding one outlier), adding over 2,500 students—approximately a 10% increase. Independent school districts dominate non-resident enrollment, with the top 20 districts (all independent) enrolling between 25% and nearly 80% non-residents and accounting for over 38% of all non-resident students statewide while representing just 3.3% of total enrollment. In contrast, 22 districts—including Kentucky's two largest, Jefferson County and Fayette County—enrolled less than 1% non-resident students. The report also highlights the growth of online programs, particularly Cloverport Independent's Kentucky Virtual Academy, which attracted approximately 2,800 students before facing regulatory limitations from the Kentucky Board of Education. Receive Bluegrass Institute updates direct to your inbox. [Learn more ](https://www.bluegrassinstitute.org/get-involved/#/portal/signup/free) Key takeaways: - **Kentucky lags nationally in open enrollment**: The state ranks poorly (35 states rank higher) due to allowing districts to charge tuition, screen students based on ability, impose strict enrollment caps, and maintain minimal transparency in policies and procedures. - **Independent districts drive non-resident enrollment growth**: All 20 districts with the highest non-resident percentages are independent districts, with 38 of 48 districts having at least 10% non-resident enrollment being independent—despite only 51 independent districts existing statewide. - **Online learning faces regulatory barriers**: The explosive growth of Cloverport's Kentucky Virtual Academy (serving \~2,800 students) prompted the Kentucky Board of Education to propose enrollment caps that would have forced 3,000 students back to their home districts. Lawmakers ultimately passed a compromise limiting virtual non-resident enrollment to 1% of statewide enrollment through 2028. Kentucky's approach to open enrollment represents a significant missed opportunity to expand educational options for families. Despite HB 563 (2021) marking progress by requiring districts to adopt non-resident policies, the Commonwealth continues to allow substantial barriers including tuition charges, ability-based screening, and limited transparency that restrict access for many families. The concentration of non-resident students in independent districts—particularly those with robust online offerings—demonstrates clear parent demand for alternative educational options, yet regulatory efforts to curtail these programs suggest resistance from traditional district leadership. To truly serve students and families, Kentucky would benefit from following the lead of the 17 states that mandate open enrollment with minimal restrictions, eliminate tuition barriers, prohibit discrimination based on ability or disability, and require comprehensive transparency and reporting on enrollment processes and outcomes. [Public School Open Enrollment in Kentucky: Policy Issues Regarding Non-Resident Kentucky permits districts to impose strict limitations on non-resident enrollment.2025OpeningTransferPolicies.pdf502 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2025/11/2025OpeningTransferPolicies.pdf "Download") ### Estimated Growth in Annual Public Teachers’ Compensation in Kentucky URL: https://www.bluegrassinstitute.org/estimated-growth-in-annual-public-teachers-compensation-in-kentucky/ Last updated: 2025-10-08T13:15:52.000Z A report by the Bluegrass Institute reveals teachers’ compensation increases significantly when fringe benefits like pensions and health insurance are factored in. [Growth in teachers' compensation study: Fringe benefits surge Report analyzes data from 2006 to 20024 Growth in teachers' compensation study.pdf447 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2025/10/Growth-in-teachers--compensation-study-3.pdf "Download") ["Estimated Growth in Annual Public Teachers’ Compensation in Kentucky," ](https://www.bluegrassinstitute.org/content/files/2025/10/Growth-in-teachers--compensation-study-3.pdf)co-authored by Paul Coomes, Ph.D., and John Garen, Ph.D., analyzes data from 2006 to 2024, focusing on the role of state-funded benefits in boosting overall pay. Key findings include: **Total compensation growth:** In 2024, the average teacher’s salary in Kentucky was $58,788\. However, with fringe benefits averaging $35,406, total compensation reached $94,194 – a 61.6% increase from $58,301 in 2006\. - **Inflation-adjusted gains**: When adjusted for inflation, total teacher compensation rose by 10.5% from 2006 to 2024, despite a 7.1% decline in inflation-adjusted salaries over the same period. - **Fringe benefits surge**: State on-behalf payments for benefits, including pensions and health insurance, jumped from $15,025 per teacher in 2006 to $35,406 in 2024 – a 136% nominal increase, or 61% when adjusted for inflation. - **Funding disparity**: While per-pupil funding increased by an inflation-adjusted 40.5% (from $14,698 in 2006 to $20,656 in 2023), teachers' compensation growth lagged behind. The report notes that, although teachers' compensation has grown, the much larger increase in school funding indicates that many resources are allocated elsewhere. Additionally, student academic performance has not kept pace with increases in either funding or teachers’ compensation. Coomes and Garen find that large increases in school funding – including nearly $2 billion in fringe-benefit payments for teachers – have not translated into better outcomes for students. According to the 2024 National Assessment of Educational Progress (NAEP), far more than half of Kentucky students are below proficiency in fourth- and eighth-grade reading and math. The NAEP data also highlights persistent academic-achievement gaps; only 12% of Black eighth-grade students were reading proficiently in 2024, compared with 33% of White students. Similar gaps have persisted for years. In 1998, NAEP eighth-grade reading results showed only 32% of White students and just 11% of Black students read proficiently. ### Bluegrass Institute announces Caleb O. Brown as Chief Executive Officer URL: https://www.bluegrassinstitute.org/bluegrass-institute-announces-caleb-o-brown-as-chief-executive-officer/ Last updated: 2025-10-02T12:46:21.000Z ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/10/UTF-8cbrown-1.jpg) Lexington, Ky. — [The Bluegrass Institute](https://www.bluegrassinstitute.org/), Kentucky’s free-market think tank, today announced that Caleb O. Brown has been named Chief Executive Officer. Brown’s employment will commence in May. Jim Waters, the institute’s president, will continue in that role. “It’s a remarkable opportunity to return to the Bluegrass Institute and direct our efforts to advance liberty in the commonwealth,” Brown said. “The Bluegrass Institute has a long track record of freedom-forward policy achievement. I look forward to building on that success.” Brown comes to the Bluegrass Institute from the libertarian Cato Institute in Washington, D.C. where he was director of multimedia and host and executive producer of the[ *Cato Daily Podcast*](https://www.cato.org/podcast?ref=bluegrassinstitute.org), the institute’s lead public-facing product. He hosted the podcast for nearly 18 years, producing well over 4,000 episodes of daily interviews with policymakers, scholars and journalists. In addition to his audio work, Brown produced original video and documentary products for the institute. For his consistency and wide-ranging knowledge of policy issues, Brown was dubbed “The Voice of Liberty” by the late longtime Cato Institute leader and Kentucky native David Boaz. This is not Brown’s first stint with the Bluegrass Institute. In 2005, he directed the institute’s [*KentuckyVotes.org*](http://kentuckyvotes.org/?ref=bluegrassinstitute.org)project, which convinced the Legislative Research Commission to begin posting bill descriptions and daily votes of Kentucky lawmakers on an easily accessible website. "Caleb has been a friend of the Bluegrass Institute for a number of years. He brings a wealth of policy knowledge and a variety of skills that will help accelerate our mission” said Bluegrass Institute chairman Aaron Ammerman. “We are grateful for Caleb’s partnership and dedication to advancing liberty and prosperity for all Kentuckians.” Previous to his earlier tour at the Bluegrass Institute, Brown was a reporter for *WHAS-AM* in Louisville and an editor at *Snitch Newsweekly*. Brown holds a Bachelor of Science in economics from the University of Louisville and a Master of Arts in economics from George Mason University. *For more information or comment, please contact Bluegrass Institute president Jim Waters at* [*jwaters@freedomkentucky.com*](mailto:jwaters@freedomkentucky.com) *or 270.320.4376.* ### Continue making Kentucky competitive again: Reduce personal income tax rate URL: https://www.bluegrassinstitute.org/continue-making-kentucky-competitive-again-reduce-personal-income-tax-rate/ Last updated: 2025-09-15T00:51:12.000Z When state lawmakers return to Frankfort next week to begin the 2025 General Assembly session, they have the opportunity to continue fueling Kentucky’s economic revival by approving yet another drop in the commonwealth’s individual income tax rate. Revenue requirements needed to trigger a further half-percent reduction in the commonwealth’s individual income tax rate – lowering it to 3.5% in 2026 – were met during the state’s 2024 fiscal year, which concluded on June 30. Established by [House Bill 8](https://apps.legislature.ky.gov/record/22rs/hb8.html?ref=bluegrassinstitute.org) (HB 8) – passed during the 2022 legislative session – those conditions involving the state’s General Fund require that: · budget reserves are at least 10% of revenues at the end of the fiscal year; · revenues would have exceeded spending even if the tax rate had been one percentage point lower; and · lawmakers give final approval during the next legislative session to implement the reduction during the following calendar year. Two of the three conditions have been met so far. State Budget Director John Hicks [informed ](https://ket.org/legislature/archives/2024/interim/interim-joint-committee-on-appropriations-revenue-7nq92f?ref=bluegrassinstitute.org)the Interim Committee on Appropriations and Revenue that a $2 billion General Fund surplus at the end of Fiscal Year 2024 on June 30 swelled budget reserves to more than $5 billion. Considering expenditures for one-time projects – with some being funded over multiple years – economic forecasters indicate the rainy day fund will stand at around $3.5 billion, or nearly 22% of expected revenues, by the end of fiscal year 2026\. This more than meets the 10% reserves-to-revenue ratio. “We encourage lawmakers to continue improving Kentucky’s economic competitiveness by reducing reliance on income taxes, which discourages productivity, while continuing to move toward the type of pro-growth tax structure that defines the revenue policies – and fiscal success – of our competitor-states,” said Jim Waters, president of the Bluegrass Institute for Public Policy Solutions, a free market think tank. “They should ignore the monotonous, predictable voices of those who claim that reducing the individual income tax rate will threaten Kentucky’s ability to fund state government and its essential services. These voices will never be satisfied, no matter how high taxes are raised or spending increases.” Lowering the personal income tax rate to 3.5% would mean that by the end of 2026, Kentuckians earning $75,000 a year would have saved more than $1,100 since HB 8 became law. All that remains for the next rate reduction is lawmakers’ final approval when they reconvene next week. “There have been historic increases in state tax revenues since state lawmakers began reducing the individual income tax rate three years ago – confirming once again the historically proven maxim: allowing individuals to keep – and make the decisions about spending – their own hard-earned dollars not only increases their own prosperity but benefits government, too,” Waters added. “By exercising the discipline to spend on needs, not wants, state lawmakers have made it possible to take yet another step in making Kentucky competitive again. May they not hesitate to do so.” ### Kentucky Right on Crime Director: The Good, the Bad and the Unknown about the 'Safer Kentucky Act' URL: https://www.bluegrassinstitute.org/kentucky-right-on-crime-director-the-good-the-bad-and-the-unknown-about-the-safer-kentucky-act/ Last updated: 2025-09-08T22:30:36.000Z The Senate Judiciary Committee will meet today in a special called meeting to consider [House Bill 5,](https://apps.legislature.ky.gov/record/24rs/hb5.html?ref=bluegrassinstitute.org) the “Safer Kentucky Act,” a very large omnibus crime bill estimated to cost Kentucky taxpayers as much as a $1 billion over the next decade. Joey Comley, Kentucky Right on Crime’s new director, joined me recently on *The Station,* the anchor show for *Kentucky’s Voice,* a new conservative media outlet. Joey talked about his organization, which offers conservative criminal justice reform policies that balance reducing crime and restoring victims with reforming offenders and lowering taxpayer costs. It’s also a balance seen in his analysis of the crime bill. Joey talks about what he likes about the bill but also notes that several of its policy proposals need more study to determine their effectiveness and cost. Watch that interview [here. ](https://youtu.be/dBMtpOj7bDE?si=gUd4MM9CoPbSqLy6&t=1047&ref=bluegrassinstitute.org) See the Bluegrass Institute’s summary of the bill, including an analysis of each section, [here](https://bluegrass-institute.ghost.io/ghost/?ref=bluegrassinstitute.org#/editor/post/68bb2c5d921b1100012762d1). ### What Amendment 2 won’t do, opponents ignore URL: https://www.bluegrassinstitute.org/what-amendment-2-wont-do-opponents-ignore/ Last updated: 2026-02-26T20:48:06.000Z The best prospect for education choice to move forward in Kentucky is if what Amendment 2 doesn’t do and opponents won’t acknowledge are top of mind for voters. Even though Amendment 2 doesn’t set up any school choice program, opponents call it “the voucher amendment.” They use shoddy research, exaggerated claims and pure fearmongering by the Kentucky Center for Economic Policy (KyCEP) to support their claims that school-choice programs will damage the commonwealth’s budget and its public education system. Passing the amendment doesn’t set up any school choice policy. It simply clarifies that Kentucky’s Constitution doesn’t prohibit lawmakers from funding school choice programs in the future. However, acknowledging the true character of Amendment 2 doesn’t fit opponents’ predetermined stance. Denying parents the same opportunities available to families in most other states must be accomplished at all costs – even if that means seriously exaggerating the price tags and ignoring the success of school choice programs nationwide. A KyCEP report released this summer claimed a robust school choice program would break Kentucky’s bank with a $700 million price tag. The cost estimates are based on an assumption that all 98,000 students currently attending a nonpublic school in Kentucky would receive a voucher. That’s way out of line with reality. John Garen, Ph.D., former chair of the University of Kentucky’s economics department, found KyCEP’s approach “exaggerates the fiscal cost of potential school choice programs by assuming 100% eligibility and 100% participation. The first is sometimes true; the second has never been.” As Garen notes in his Bluegrass Institute policy brief, [“Fiscal Effects of School Choice: Doomsday Speculation Versus Reality,”](https://www.bluegrassinstitute.org/content/files/2026/02/202409-Bluegrass-Fiscal-Effects-of-School-Choice.pdf) rarely do even well-established programs enroll more than 6% of eligible families. [Fiscal Effects of School Choice: Doomsday Speculation Versus Reality202409 Bluegrass Fiscal Effects of School Choice.pdf318 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2026/02/202409-Bluegrass-Fiscal-Effects-of-School-Choice.pdf "Download") Such research shenanigans diminish the credibility of KyCEP’s approach, removing any sense of objectivity while signaling to reasonable Kentuckians – including their legislators – that the conclusions reached through such exaggerations cannot be taken seriously and should not guide decisions affecting Kentucky’s families for generations to come. The KyCEP’s credibility takes another hit by ignoring savings produced by school choice programs nationwide and their positive impact on students’ academic performance. In his own simulation, which uses actual information from other school choice states, Garen offers a far more reasonable estimate of a program’s impact in Kentucky. He calculates that a $7,000 Education Savings Account or voucher used by 20% of Kentucky’s private and homeschool students – still a higher rate of use than most programs experience – would net $116 million in savings for state taxpayers. Garen arrived at this calculation by coupling the cost of vouchers received by non-public school students with a reasonable estimate of the savings realized for each student using a $7,000 ESA or voucher, the cost of which is much lower than the $20,000 Kentucky’s school districts receive for each student enrolled in their schools. “Savings” and “success” can’t be found in cynical opponents’ consideration. Instead, they try to make the case that growing school choice programs in other states are bankrupting state budgets. Those claims have backfired. Arizona’s own Department of Education recently announced it was [in the black](https://www.azed.gov/communications/state-education-funding-comes-under-budget-demolishes-esa-budget-myth?ref=bluegrassinstitute.org) at the end of the state’s fiscal year. While Arizona did have an overall deficit, that state’s education budget wasn’t the cause. In fact – and ironic in light of school choice opponents’ unsubstantiated rush to deem school choice a fiscal failure – it’s the education budget that helped shrink the size of Arizona’s shortfall. Even the KyCEP report acknowledges “rapidly growing programs in Arizona, Indiana, Iowa, North Carolina, Ohio and Wisconsin,” which begs the question: Why are such alternatives growing in popularity if such options aren’t welcomed by parents, needed by families and setting kids up for success? Recent studies show the positive impact of school choice policies on students’ learning in traditional public schools. For instance, in the 1990s, Florida’s public schools scored lower than the national average – and below or near Kentucky – on the “Nation’s Report Card,” but now has become a leader in academic results. This is all happening with public schools in a state where [nearly 500,000 students participate](https://nextstepsblog.org/2024/07/more-than-230000-students-and-counting-awarded-florida-education-choice-scholarships/?ref=bluegrassinstitute.org)in funded school choice programs that offer them a better education and a brighter future. Yet antagonists don’t even want to have a discussion about how such policies could positively impact Kentucky, despite the fact that a majority of our public school students are not proficient in math and reading. They disregard the benefits, savings and general positive impact of other states’ school choice programs – something, however, that will likely be hard for voters to ignore. *Jim Waters is president of the Bluegrass Institute.* ### Setting the record straight on educational choice in Arizona URL: https://www.bluegrassinstitute.org/setting-the-record-straight-on-educational-choice-in-arizona/ Last updated: 2025-08-07T17:16:29.000Z More than [1.1 million](https://azreportcards.azed.gov/state-reports?ref=bluegrassinstitute.org) children in Arizona attend schools their parents picked. Yet some so-called “[experts](https://kypolicy.org/the-impact-of-diverting-public-money-to-private-school-vouchers-in-kentucky/?ref=bluegrassinstitute.org)” want Kentuckians to believe that the Grand Canyon State has devolved into a bankrupt, smoldering version of Mordor thanks to its latest universal choice program—the [Empowerment Scholarship Account](https://www.azed.gov/esa?ref=bluegrassinstitute.org) (ESA) program. The reality is Arizona families have benefited from universal educational choice programs for 30 years. Statewide public-school open enrollment and charter school laws were enacted in 1994, followed by a private-school tax-credit scholarship enacted in 1997\. Then in 2022 Arizona enacted its third universal educational choice program when all schoolchildren statewide became eligible to participate in the Empowerment Scholarship ESA. Opponents’ dire predictions [still haven’t materialized](https://carillon-mustard-cxnt.squarespace.com/blog/1z8lx9ns5e7w71g5mi7uvz5hetvdg1?ref=bluegrassinstitute.org). Under Arizona’s ESA program the state deposits just a fraction of the funding that would have gone to participating students’ public schools into their ESAs instead. With those funds parents pay for allowable education expenses such as private school tuition, homeschooling or online curricula, special education therapies and tutoring. Currently, [just over 80,000 students](https://www.azed.gov/esa?ref=bluegrassinstitute.org) are using ESAs. For all the fearmongering about a massive public-school exodus should parents be allowed to pick non-public-school options, public-school choice remains the most widely exercised form of educational choice in Arizona. In fact, nearly [one-third](https://www.azed.gov/finance/data-collection-reporting-school-and-student-membership-data?ref=bluegrassinstitute.org) of all students statewide (about 340,000) attend public schools determined by their parents—not their zip codes. Today, Arizona is a [national leader in student academic growth](https://www.the74million.org/article/analysis-arizona-leads-in-academic-growth-and-both-charter-and-district-schools-contribute-to-student-success/?ref=bluegrassinstitute.org) overall, as well as across various student socioeconomic demographics, thanks in no small part to its public school performance. Moreover, Arizona has had some of the [largest score gains](https://www.nagb.gov/content/dam/nagb/en/documents/newsroom/press-releases/2019/arizona-narrative-20190621.pdf?ref=bluegrassinstitute.org) on the [Nation’s Report Card](https://www.nationsreportcard.gov/?ref=bluegrassinstitute.org) in fourth- and eighth-grade mathematics and reading, gains that “[were roughly double the national average from 2005 to 2017](https://www.azcentral.com/story/opinion/op-ed/robertrobb/2019/07/07/school-choice-why-arizona-keeps-crushing-naep-test/1633322001/?ref=bluegrassinstitute.org).” Importantly, Arizona achieves such success despite [spending far less](https://educationdata.org/public-education-spending-statistics?ref=bluegrassinstitute.org#:~:text=New%20York%20schools%20spend%20the,percentage%20of%20local%20taxpayer%20income.) per pupil than most states, including Kentucky, which spends $5,000 more per pupil than Arizona. Rather than highlighting how Arizona gets more bang for every education buck, opponents’ standard [refrain](https://www.goldwaterinstitute.org/school-choice-and-the-heresy-of-success/?ref=bluegrassinstitute.org) is that educational choice programs like Arizona’s [drain funding](https://www.bipps.org/bluegrass-beacon-comentary/education-choice-saving-arizona-millions-?ref=bluegrassinstitute.org) from public education. For example, Arizona [opponents](https://www.goldwaterinstitute.org/arizonas-universal-esa-program-a-history-of-surplus-savings-media-misinformation/?ref=bluegrassinstitute.org) insisted that the ESA program would “[bankrupt](https://arizonadailyindependent.com/2024/01/30/esa-report-shows-budget-surplus-not-near-bankruptcy/?ref=bluegrassinstitute.org)” the state budget, and some [Kentucky opponents](https://kypolicy.org/wp-content/uploads/2024/07/Amendment-2-Report-final-2.pdf?ref=bluegrassinstitute.org) claim the Bluegrass State would suffer a similar fate if lawmakers enacted one, too. Once again, the [facts](http://file///C:/Users/User/Documents/2014%200501%20version/Clients%202024/BIPPS/Op-ed%20AZ%20Facts%2020240910/,%20https:/www.foxnews.com/opinion/one-states-budget-dispels-big-lie-about-school-choice?ref=bluegrassinstitute.org) disprove the fearmongering. A new [analysis](https://www.edchoice.org/wp-content/uploads/2024/10/Fiscal-Effects-2024.pdf?ref=bluegrassinstitute.org) of 48 private educational choice programs in 25 states finds that for every dollar spent on them, these programs generate an average estimated savings of between $1.70 and $2.64\. As for Arizona’s universal ESA, the analysis also found that fears of it “[blowing a hole in the budget](https://www.forbes.com/sites/petergreene/2021/02/01/six-big-problems-with-education-savings-accounts/?ref=bluegrassinstitute.org)” were wildly exaggerated. The estimated upfront net cost of $37 million in 2022 represented just 0.2 percent of taxpayer funding for Arizona K–12 public schools. The longer-term savings more than make up for that initial cost. Conservative [fiscal estimates](https://www.edchoice.org/wp-content/uploads/2024/10/Fiscal-Effects-2024.pdf?ref=bluegrassinstitute.org) suggest Arizona’s ESA program will yield annual net fiscal savings of $244 million. In fact, actual savings have already accrued. Contrary to opponents’ doomsday predictions, not only did Arizona education funding, including for ESAs, finish at [$4.3 million under budget](https://www.azed.gov/communications/state-education-funding-comes-under-budget-demolishes-esa-budget-myth?ref=bluegrassinstitute.org), state revenue was [$412 million higher](https://www.azjlbc.gov/mfh/mfh-aug-24.pdf?ref=bluegrassinstitute.org) than the enacted budget. Additionally, average Arizona per-pupil funding reached a [record-breaking high](https://www.goldwaterinstitute.org/record-breaking-15k-per-kid-spending-in-az-public-schools-amid-esa-growth/?ref=bluegrassinstitute.org) of nearly $15,000 per pupil amidst the historic expansion of the state’s universal ESA program. Then there’s the notion that universal educational choice is a “[giveaway to the rich](https://www.cato.org/blog/universal-school-choice-arizona-not-giveaway-rich?ref=bluegrassinstitute.org).” The Brookings Institution, for example, dubbed Arizona’s universal ESA program “[a handout to the wealthy](https://www.brookings.edu/articles/arizonas-universal-education-savings-account-program-has-become-a-handout-to-the-wealthy/?ref=bluegrassinstitute.org).” The reality is nearly half of all Arizona ESA students (47.6 percent) were previously enrolled in [public schools](https://www.azed.gov/sites/default/files/2024/08/ESA%20FY24%20Q4%20Executive%20Legislative%20Report.pdf?ref=bluegrassinstitute.org), and significant proportions of them are from [moderate-income](https://www.commonsenseinstituteus.org/arizona/research/education/redefining-accountability-empowerment-in-arizonas-esa-program?ref=bluegrassinstitute.org) households, have [special needs](https://www.azed.gov/sites/default/files/2024/08/Q3%20FY2024%20ESA%20Report%5FSBE.pdf?ref=bluegrassinstitute.org) or live within the boundaries of [failing public schools](https://www.azed.gov/sites/default/files/2024/08/Q3%20FY2024%20ESA%20Report%5FSBE.pdf?ref=bluegrassinstitute.org). This is a significant finding since Arizona has long had [additional public and private educational choice programs](https://nextstepsblog.org/2024/05/a-real-fresh-prince-can-go-to-school-in-scottsdale-but-not-bel-air/?ref=bluegrassinstitute.org) serving students with similar backgrounds. Thus, universal ESAs are helping even more—not fewer—students who need different education options. Kentucky Lt. Gov. Jacqueline Coleman likewise insists that educational choice programs such as Arizona’s “were always intended to pad the pockets of the [privileged](https://x.com/LtGovColeman/status/1831425752178328009?ref=bluegrassinstitute.org)” and not intended for “marginalized” students. Not only does the empirical evidence show otherwise, choice opponents’ silence about just how many “privileged” students taxpayers subsidize in the public-school system is deafening. A recent [analysis](https://www.goldwaterinstitute.org/policy-report/the-anti-esa-double-standard/?ref=bluegrassinstitute.org) of this phenomenon in Arizona found that “[taxpayers spend 10–20 times more money](https://www.goldwaterinstitute.org/new-report-debunks-anti-school-choice-welfare-for-the-wealthy-narrative/?ref=bluegrassinstitute.org) subsidizing public school instruction for children from households earning over $150,000 than they do on similarly situated families who have joined the ESA program from a private or home-based school under universal expansion.” So, after 30 years and three universal educational choice programs is Arizona devastated? Hardly. The future looks even brighter for another generation of Arizona students—and there’s no good reason it couldn’t be just as bright for Kentucky students. *Vicki Murray-Alger, Ph.D., is a Visiting Fellow with the Bluegrass Institute for Public Policy Solutions.* ### Bluegrass Institute files amicus brief urging Kentucky Supreme Court to overturn ‘flawed’ school choice ruling URL: https://www.bluegrassinstitute.org/bluegrass-institute-files-amicus-brief-urging-kentucky-supreme-court-to-overturn-flawed-school-choice-ruling/ Last updated: 2026-02-19T20:38:01.000Z FOR IMMEDIATE RELEASE FRANKFORT, Ky – A Bluegrass Institute [amicus brief](https://www.bluegrassinstitute.org/content/files/2026/02/Bluegrass-HB9-Amicus.pdf?ref=bluegrassinstitute.org) authored by former Solicitor General Chad Meredith in support of expanding education opportunities in Kentucky urges the state Supreme Court to overturn a lower court’s ruling that legislation funding public charter schools passed by the General Assembly in 2022 is unconstitutional. [Bluegrass HB9 AmicusBluegrass HB9 Amicus.pdf486 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2026/02/Bluegrass-HB9-Amicus.pdf "Download") The brief calls Franklin Circuit Judge Phillip Shepherd’s [ruling](https://www.documentcloud.org/documents/24214199-hb-9-circuit-court-ruling?responsive=1&title=1&ref=bluegrassinstitute.org) overturning [House Bill 9](https://apps.legislature.ky.gov/law/acts/22RS/documents/0213.pdf?ref=bluegrassinstitute.org) “flawed because it focuses on whether charter schools are common schools” rather than addressing whether lawmakers are constitutionally empowered to fund such schools with dollars from the state’s General Fund. [Section 184](https://apps.legislature.ky.gov/Law/Constitution/Constitution/ViewConstitution?rsn=214&ref=bluegrassinstitute.org) of the Kentucky Constitution – the primary section at issue being used by opponents in legal arguments meant to stymie lawmakers’ ability to fund school-choice programs – places no limitation on General Fund appropriations and is “merely a taxpayer-protection provision that limits new ways of raising revenue but says nothing about appropriations.” According to [this summary](https://www.bluegrassinstitute.org/content/files/2026/02/Bluegrass-HB9-Amicus-Summary.pdf?ref=bluegrassinstitute.org) of the brief: ● Delegates to the 1891 constitutional convention – where the current Kentucky Constitution was ratified – believed that Kentuckians were taxed enough already and included a provision in Section 184 to limit the power to *tax,* not the power to *spend.* ● Whether or not charter schools are viewed as “common schools," nothing in the constitution prohibits the General Assembly from funding them with General Fund appropriations. ● This interpretation is consistent with both historical and current appropriations practices. Since the constitution was ratified, the legislature has appropriated funds for all manner of educational endeavors, including those that don’t align with Shepherd’s definition of a common school, including magnet schools, the Gatton and Craft academies, and many others. ● Public charter schools are consistent with the constitution’s directive in[ Section 183](https://apps.legislature.ky.gov/Law/Constitution/Constitution/ViewConstitution?rsn=213&ref=bluegrassinstitute.org) that the General Assembly create “an efficient system of common schools.” Charters provide competition in the educational market, which has been remarkably successful in improving public education in other states. [Bluegrass HB9 Amicus SummaryBluegrass HB9 Amicus Summary.pdf181 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2026/02/Bluegrass-HB9-Amicus-Summary.pdf "Download") “We urge the Supreme Court to carefully consider the arguments in our brief,” said Bluegrass Institute President Jim Waters. “The constitution empowers lawmakers to create and fund school-choice programs like charter schools, which are available to parents in most other states and are producing better educational outcomes for students." ### *Bluegrass Institute works with Kentuckians, grassroots organizations, and business owners to advance freedom and prosperity by promoting free-market capitalism, smaller government and defense of personal liberties.* ### Public charter schools are a constitutional obligation in Kentucky URL: https://www.bluegrassinstitute.org/pubpublic-charter-schools-are-a-constitutional-obligation/ Last updated: 2025-09-22T13:30:13.000Z When the Kentucky General Assembly passed House Bill 9 in 2022, we took a step toward delivering real education options to families seeking more from their public schools. Due to a pending legal challenge before the Kentucky Supreme Court, however, we remain one of a handful of states without a single operating public charter school. Public charter schools operate in 44 states and serve 3.7 million students. Not a single Kentucky student is among them. These schools, chosen voluntarily by families, often serve higher proportions of low-income students and students of color than traditional public schools. They are also held to increased accountability for performance. Between the 2010–2011 and 2021–2022 school years, national charter enrollment more than doubled from 1.8 million to 3.7 million students. Families are voting with their feet. As a legislator and an attorney, I take Kentucky’s constitutional responsibilities seriously. I believe our charter school law fully aligns with those principles. In fact, it is because of the constitution, not despite it, that we must give families greater access to high-quality public school options. Our charter school law was designed to complement Kentucky’s “common school” system, not compete with it. Charter schools are tuition-free, publicly funded, and held to rigorous academic and financial standards. It is not a private option. Rather, it is an innovative public option created through legislative authority to serve students better. The legal foundation is strong. Section 183 of the Kentucky Constitution directs that “the General Assembly shall, by appropriate legislation, provide for an efficient system of common schools throughout the State.” Kentucky’s highest court has previously described this language as granting the legislature the broadest possible authority to address public education. That duty was further defined in the *Rose* decision, which outlined nine criteria for a constitutionally valid system. Charter schools meet every one, from being open to all students to operating with public dollars to maintaining strong standards of accountability. Some have claimed that charter schools cannot be part of the common school system because not every student can attend when demand exceeds capacity. However, this argument would disqualify many of Kentucky’s most respected programs, including magnet schools in Jefferson and Fayette Counties, and the Gatton and Craft academies. Those schools are public, selective, and limited by space, but no one disputes their constitutional standing. The same should apply to charter schools, which rely on lotteries when applications exceed capacity. There is also a fiscal angle. Since 1994, when President Bill Clinton signed the federal Charter Schools Program into law, the federal government has distributed billions in grants to support charter school start-up and innovation. In each of the past three fiscal years, Congress has allocated $440 million to support charter development. Kentucky has received none of this funding, not because we are ineligible, but because the General Assembly’s charter school legislation has been blocked by the courts. In effect, Kentucky taxpayers are subsidizing education innovation in other states while reaping none of the benefits at home. No single school model can solve every challenge, but charter schools are a valuable part of the public education landscape. They should be available to Kentucky families, particularly in communities where traditional options are not meeting student needs. Charter schools help meet the diverse needs of students by allowing more flexibility and innovative delivery methods. When our children succeed, the whole of Kentucky succeeds. Our priorities should not be shaped by politics or pressure from entrenched interests. They should be guided by performance. That means honoring our constitutional duty to provide every Kentucky child with access to an adequate, equitable, and efficient education. The legislature is not asking for new funding streams or higher taxes. We are asking for the flexibility to use existing public dollars more effectively and to allow parents to choose what is best for their children. The case before the court is about more than legal definitions. It is about the future of public education in our state and the legislature’s constitutional authority to lead on that future. Kentucky families have waited long enough. *Sen. Steve West, R-Paris, represents Kentucky’s 27th Senate District.* ### WATCH Voice for Change: Dr. Jerry Stephenson on Amendment 2, empowering parents URL: https://www.bluegrassinstitute.org/watch-voice-for-change-dr-jerry-stephenson-on-amendment-2-empowering-parents/ Last updated: 2025-07-23T14:19:11.000Z [***“I am not a person, when I see something wrong, to just close my eyes and walk away from it.”***](https://www.youtube.com/watch?v=kJkhyhomP8A&ref=bluegrassinstitute.org) Dr. Jerry Stephenson, pastor of the Midwest Church of Christ in Louisville, saw something very wrong. When Pastor Stephenson learned that only 22% of a local middle school’s students could read at grade level, he called a friend that worked with the school district to confirm the information. The friend confirmed it: scores really were that low. Dr. Stephenson didn’t just walk away. He’s lifting his voice with Kentuckians across the commonwealth to advocate for school choice, which would be made possible by passing Amendment 2. Pastor Stephenson believes putting the money into the hands of parents – empowering them to choose the educational option that best fits their children – is the way to achieve the greatest change and improvement in our schools. Passing Amendment 2, he says, will clear the way for Kentucky lawmakers to pass consequential school choice policies. ### Florida Versus Kentucky: How school choice improves public school performance, too URL: https://www.bluegrassinstitute.org/florida-versus-kentucky-how-school-choice-improves-public-school-performance-too/ Last updated: 2025-09-27T21:01:34.000Z Opponents of Amendment 2, which would remove barriers to passing meaningful school-choice legislation in Kentucky, claim such policies would harm the commonwealth's public education system. Yet the Bluegrass Institute's analyses of how public education fares in other states with sturdy, and expanding, school-choice opportunities for families, indicate such policies have the opposite effect. [Florida Versus Kentucky: How school choice improves public school performance, Florida used to trail Kentucky. But now, parents have many choices and its students lead the nation.1fdf4a\_6f82f9ded87c4090a1042495ba7cf643\[1\].pdf445 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2025/09/1fdf4a%5F6f82f9ded87c4090a1042495ba7cf643-1--1.pdf "Download") This policy brief updates an earlier analysis, with both indicating that public education in Florida – with its vigorous and growing school-choice programs – continues its states-leading performance, including for minority students. The earlier policy brief released in May 2021 assessed how Florida’s public schools had fared since the first charter school opened in the Sunshine State in 1996, which was followed by the implementation and expansion of several other education-freedom policies. The 2021 brief reported that as Florida began and expanded school-choice programs, the performance of its public education system dramatically improved – from performing below or roughly equal to Kentucky in the 1990s to outperforming not only the Bluegrass State but also the entire nation in fourth- and eighth-grade reading and math results. According to the National Assessment of Educational Progress, known as the “nation’s report card,” Kentucky’s Black students scored higher in fourth- and eighth-grade math and reading than Florida’s Black students in 1990\. By 2022, however, when Floridians had many school-choice options, Florida’s Black students scored ahead of Kentucky in all fourth- and eighth-grade reading and math results. ### Review of Facts and Trends in Fayette County Public Schools URL: https://www.bluegrassinstitute.org/facts-and-trends-fayette-2024/ Last updated: 2026-07-23T14:43:43.000Z [A+Review+of+Facts+and+Trends+in+Fayette+County+Public+SchoolsHigher Spending, Lower Teacher SalariesA+Review+of+Facts+and+Trends+in+Fayette+County+Public+Schools.pdf699 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2026/07/A-Review-of-Facts-and-Trends-in-Fayette-County-Public-Schools.pdf "Download") John Garen's May 2024 Bluegrass Institute Policy Point documents a growing gap between spending and results in Fayette County Public Schools (FCPS). Inflation-adjusted per-pupil funding more than doubled from an estimated $10,769 in 1990 to $22,621 in 2023, a 110% increase that left FCPS spending 12% above the statewide average. Despite this, achievement has stagnated. On 2023 Kentucky Summative Assessment testing, 49% to 62% of FCPS students scored below proficient in fourth- and eighth-grade reading and math, and 70% or more of Black students failed to reach proficiency. ACT composite scores for 11th graders rose slightly through 2017 but have since declined, while a large White–Black score gap has persisted with little change. The report also finds that the funding surge has not reached classroom teachers. Inflation-adjusted teacher salaries climbed from 2000 to the mid-2010s and then fell, ending 2023 just 1.06 times their 1990 level, even as per-pupil funding reached 2.1 times its 1990 level. Garen notes that part of the recent per-pupil increase reflects a 3.5% decline in average daily attendance rather than new investment alone. Taken together, the findings show funding far outpacing both teacher pay and student outcomes, with persistent proficiency and racial achievement gaps that added spending has not closed. ### Local Bang for More Bucks: A Review of Facts and Trends in JCPS URL: https://www.bluegrassinstitute.org/local-bang-for-more-bucks-a-review-of-facts-and-trends-in-jcps/ Last updated: 2026-03-28T00:34:07.000Z Jefferson County Public Schools (JCPS) is Kentucky's largest school district and among its most generously funded, spending $23,561 per pupil in 2022 — 36% more than the statewide average. Despite this sustained investment, student achievement has stagnated and, in recent years, declined. The district's track record raises a fundamental question: are Louisville-area taxpayers getting adequate educational returns on their substantial and growing investment? **Main Takeaways** - **Spending has surged while student achievement has not.** Inflation-adjusted per-pupil funding in JCPS more than doubled between 1990 and 2022 — a 132% increase — yet over 60% of JCPS students failed to reach proficiency on the 2023 Kentucky Summative Assessment in grades 4 and 8 reading and math. NAEP scores paint an even grimmer picture, with over 70% of JCPS students falling below proficiency. Scores on both tests have actually trended downward in recent years. - **The racial achievement gap is wide and not closing.** Black students in JCPS face particularly alarming outcomes: more than 75% scored below proficient on the 2023 KSA, and the NAEP shows over 85% below proficient. The White–Black gap in both NAEP and ACT scores is at least as large today as it was in 2009, demonstrating that decades of increased spending have done nothing to narrow this persistent disparity. - **The productivity of education dollars in JCPS is declining and lags the rest of Kentucky.** Measured as NAEP test-score points per $1,000 of per-pupil funding, JCPS productivity has fallen sharply over time and averaged 22% below the statewide average — reaching 28% below in 2022\. Meanwhile, the surge in overall district spending has far outpaced teacher salaries: per-pupil funding grew to 2.32 times its 1990 level while teacher pay grew to only 1.16 times its 1990 level, raising serious questions about where the money is going. The data present a clear and troubling pattern: JCPS has received dramatically more funding over three decades with little to show for it in student learning, and the district's most vulnerable students — low-income and Black children — are bearing the greatest cost of this failure. Policymakers should resist the reflexive call for still more spending and instead demand accountability for how existing dollars are used. Specific reforms worth pursuing include greater transparency in district expenditures to identify where funding growth is going if not to teacher salaries and classroom instruction; stronger outcome-based accountability metrics tied to disbursement of state and local funds; and expanded school choice options — including charter schools and education savings accounts — that would give families, especially those in underserved communities, the ability to seek better educational environments. Throwing more money at a system with declining productivity is not a solution; restructuring incentives to reward results is. [Local Bang for More BucksA Review of Facts and Trends in JCPSBIPPS+Policy+Point.+Local+bang+for+more+bucks..A+review+of+the+facts+and+trends+in+JCPS.pdf959 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2026/03/BIPPS-Policy-Point.-Local-bang-for-more-bucks..A-review-of-the-facts-and-trends-in-JCPS.pdf "Download") ### Education choice saving Arizona millions URL: https://www.bluegrassinstitute.org/education-choice-saving-arizona-millions-2/ Last updated: 2026-01-27T19:54:12.000Z Alarmists incessantly accuse education-choice supporters of “cherry picking” the data, and schools of choice of doing the same with their student bodies. Actually, it’s those doomsdayers who lead the way when it comes to “selective analysis” regarding the impact of school choice programs in other states. A recent op-ed by Bluegrass Institute scholars Gary Houchens and John Garen looked at how retired Frankfort bureaucrat and lawyer John Schaaf [cherry-picks](https://kentuckylantern.com/2024/02/19/school-vouchers-hurting-students-academic-performance-several-studies-show/?ref=bluegrassinstitute.org) the research in a recent Kentucky Lantern column by ignoring a large body of studies showing the positive impact of private school access programs. In [another column](https://kentuckylantern.com/2024/01/17/tax-dollars-are-wasted-in-states-with-school-vouchers/?ref=bluegrassinstitute.org), Schaaf takes aim at the success of education-freedom policies in Arizona, which seems to be a favorite target state for critics obsessed with denying Kentucky families the same types of choices available to parents in a growing majority of other states. “In Arizona and other states where taxpayer vouchers are being spread around like manure on a pig farm, there’s minimal accountability or transparency for the use of taxpayer money in private schools,” Schaaf wrote. Schaaf’s lack of understanding about how accountability is built into school choice policies is startling, but far too common among political, legal and education ideologues obsessed with blocking Kentucky parents’ access to educational freedom. When schools of choice – whether they’re public charter schools or nonpublic institutions – fail to satisfy the promises they make to families, they close because parents quit choosing to enroll their children. That’s “accountability” at the greatest level – much greater than we see in traditional public schools that fail to make the grade. Instead of being shut down, poorly-performing traditional K-12 public schools are frequently allowed to continue the mediocrity with some minor – usually meaningless – changes, while often receiving even more funding. Despite the realities surrounding school choice, cherry-picking by opponents was on full display during KET’s recent “Kentucky Tonight” forum on school choice and spending. in which this columnist was invited to participate. Another panelist on that program, Kentucky Education Association president Eddie Campbell, also disparaged Arizona and that state’s Empowerment Scholarship Accounts (ESA). Campbell regurgitated the apocalyptic rhetoric of Arizona Gov. Katie Hobbs – a Democratic opponent of choice with a Republican pro-education-freedom legislature (sound familiar, Kentucky?) – who claims the ESA program will “starve” public education. But the Hobbs memo has been widely criticized for its misleading portrayal of what’s happening with the ESA program and for its own cherry-picking by not even mentioning, for example, the policy’s robust savings for Arizona’s public education system. Supporters anticipate such savings will happen if Kentucky eventually adopts a similar policy. Vicki Alger, Ph.D., a Bluegrass Institute Visiting Fellow, national expert on education choice programs and an Arizona resident herself, notes her state’s ESA program “generates an estimated savings of $1.25 for every dollar spent – a staggering 125 percent return on investment.” Alger points out that the program has saved the Grand Canyon State an estimated $41 million in a couple of important ways: · The public system isn’t responsible for educating students that enroll in nonpublic schools – “choice programs typically cost thousands of dollars less per pupil than public schools,” she notes. Yet at the same time, school districts still receive all their local and federal funding. · Each Arizona ESA, for example, sets aside just $7,200 for those who take the school-choice option. That’s about half the amount spent by the state on each traditional K-12 student, on average. “If opponents were truly interested in more money for public schools, then they would be overjoyed, not outraged, about ESAs,” Alger concludes. Critics also wrongly portray education choice programs as zero-sum policies. The number of students participating in Arizona’s ESA program has increased exponentially as eligibility expanded – from its launch with 153 children with learning disabilities in 2011 to more than 70,000 students currently. At the same time, Alger notes funding for public education has grown by nearly $800 million in additional state and local dollars in 2024 alone. Still, Campbell presses on, claiming Arizona is “talking about what programs are going to have to be cut.” In what universe is $800 million *more* a *“cut?”* Then, Campbell exhibits his own apocalyptic rhetoric with claims that multiple states with robust choice programs are even cutting their general funds because of education-choice policies. “This is not just Arizona; this is multiple states where they’ve found they have to cut services,” Campbell claims. “They have to cut public school funding, they’re going to have cut police and fire, you know those other public services that are supported by tax dollars because this is draining those precious tax dollars out of that general fund. “ But Campbell and his anti-education-freedom union fail to provide a single shred of evidence that any state has had to cut emergency services – or even reduce public education funding, for that matter – due to giving parents more alternatives and their children better educational opportunities. The closer we get to November’s vote on a constitutional amendment to remove barriers to Kentucky’s parents deciding where and how their children will be educated, expect more of this mixture of fearmongering and cherry-picking to get spread around. Campbell and his crowd hope to frighten unsuspecting Kentucky voters into believing that bringing education choice and freedom to our commonwealth will result in a dramatic reduction of funding for vital public services – including schools – and a multitude of other harmful consequences. Alarmists will exaggerate costs without any acknowledgement of the savings, the growth or increased opportunities for children and their futures. Nor will opponents demonstrate any notable interest in discovering *why* such growth in participation has occurred in so many states with school-choice programs. Secretly, opponents know that without choice, the K-12 public education system essentially has no accountability, and it seems some want to keep it that way – even if our children suffer for it. ### Education choice saving Arizona millions URL: https://www.bluegrassinstitute.org/education-choice-saving-arizona-millions/ Last updated: 2025-07-22T18:31:20.000Z *Editor’s note: The Bluegrass Beacon is a weekly syndicated newspaper column posted on the Bluegrass Institute’s website after appearing in publications statewide.* Alarmists incessantly accuse education-choice supporters of “cherry picking” the data, and schools of choice of doing the same with their student bodies. Actually, it’s those doomsdayers who lead the way when it comes to “selective analysis” regarding the impact of school choice programs in other states. A recent [op-ed](https://bipps.org/blog/what-research-really-says-about-school-choice?ref=bluegrassinstitute.org) by Bluegrass Institute scholars Gary Houchens and John Garen looked at how retired Frankfort bureaucrat and lawyer John Schaaf[ cherry-picks ](https://kentuckylantern.com/2024/02/19/school-vouchers-hurting-students-academic-performance-several-studies-show/?ref=bluegrassinstitute.org)the research in a recent Kentucky Lantern column by ignoring a large body of studies showing the positive impact of private school access programs. In [another column](https://kentuckylantern.com/2024/01/17/tax-dollars-are-wasted-in-states-with-school-vouchers/?ref=bluegrassinstitute.org), Schaaf takes aim at the success of education-freedom policies in Arizona, which seems to be a favorite target state for critics obsessed with denying Kentucky families the same types of choices available to parents in a growing majority of other states. “In Arizona and other states where taxpayer vouchers are being spread around like manure on a pig farm, there’s minimal accountability or transparency for the use of taxpayer money in private schools,” Schaaf wrote. Schaaf’s lack of understanding about how accountability is built into school choice policies is startling, but far too common among political, legal and education ideologues obsessed with blocking Kentucky parents’ access to educational freedom. When schools of choice – whether they’re public charter schools or nonpublic institutions – fail to satisfy the promises they make to families, they close because parents quit choosing to enroll their children. That’s “accountability” at the greatest level – much greater than we see in traditional public schools that fail to make the grade. Instead of being shut down, poorly-performing traditional K-12 public schools are frequently allowed to continue the mediocrity with some minor – usually meaningless – changes, while often receiving even more funding. Despite the realities surrounding school choice, cherry-picking by opponents was on full display during KET’s recent “Kentucky Tonight” [forum](https://bipps.org/blog/bipps-president-makes-the-case-for-choice-transparency-in-ket-debate?ref=bluegrassinstitute.org) on school choice and spending. in which this columnist was invited to participate. Another panelist on that program, Kentucky Education Association president Eddie Campbell, also disparaged Arizona and that state’s Empowerment Scholarship Accounts (ESA). Campbell regurgitated the apocalyptic rhetoric of Arizona Gov. Katie Hobbs – a Democratic opponent of choice with a Republican pro-education-freedom legislature (sound familiar, Kentucky?) – who claims the ESA program will “starve” public education. But the Hobbs memo has been widely criticized for its misleading portrayal of what’s happening with the ESA program and for its own cherry-picking by not even mentioning, for example, the policy’s robust savings for Arizona’s public education system. Supporters anticipate such savings will happen if Kentucky eventually adopts a similar policy. Vicki Alger, Ph.D., a Bluegrass Institute Visiting Fellow, national expert on education choice programs and an Arizona resident herself, [notes](https://bipps.org/blog/1z8lx9ns5e7w71g5mi7uvz5hetvdg1?ref=bluegrassinstitute.org) her state’s ESA program “generates an estimated savings of $1.25 for every dollar spent – a staggering 125 percent return on investment.” Alger points out that the program has saved the Grand Canyon State an estimated $41 million in a couple of important ways: · The public system isn’t responsible for educating students that enroll in nonpublic schools – “choice programs typically cost thousands of dollars less per pupil than public schools,” she notes. Yet at the same time, school districts still receive all their local and federal funding. · Each Arizona ESA, for example, sets aside just $7,200 for those who take the school-choice option. That’s about half the amount spent by the state on each traditional K-12 student, on average. “If opponents were truly interested in more money for public schools, then they would be overjoyed, not outraged, about ESAs,” Alger concludes. Critics also wrongly portray education choice programs as zero-sum policies. The number of students participating in Arizona’s ESA program has increased exponentially as eligibility expanded – from its launch with 153 children with learning disabilities in 2011 to more than 70,000 students currently. At the same time, Alger notes funding for public education has grown by nearly $800 million in additional state and local dollars in 2024 alone. Still, Campbell presses on, claiming Arizona is “talking about what programs are going to have to be cut.” In what universe is $800 million *more* a *“cut?”* Then, Campbell exhibits his own apocalyptic rhetoric with claims that multiple states with robust choice programs are even cutting their general funds because of education-choice policies. “This is not just Arizona; this is multiple states where they’ve found they have to cut services,” Campbell claims. “They have to cut public school funding, they’re going to have cut police and fire, you know those other public services that are supported by tax dollars because this is draining those precious tax dollars out of that general fund. “ But Campbell and his anti-education-freedom union fail to provide a single shred of evidence that any state has had to cut emergency services – or even reduce public education funding, for that matter – due to giving parents more alternatives and their children better educational opportunities. The closer we get to November’s vote on a constitutional amendment to remove barriers to Kentucky’s parents deciding where and how their children will be educated, expect more of this mixture of fearmongering and cherry-picking to get spread around. Campbell and his crowd hope to frighten unsuspecting Kentucky voters into believing that bringing education choice and freedom to our commonwealth will result in a dramatic reduction of funding for vital public services – including schools – and a multitude of other harmful consequences. Alarmists will exaggerate costs without any acknowledgement of the savings, the growth or increased opportunities for children and their futures. Nor will opponents demonstrate any notable interest in discovering *why* such growth in participation has occurred in so many states with school-choice programs. Secretly, opponents know that without choice, the K-12 public education system essentially has no accountability, and it seems some want to keep it that way – even if our children suffer for it. *Jim Waters is president of the Bluegrass Institute for Public Policy Solutions, Kentucky’s free market think tank. Reach him at* [*jwaters@freedomkentucky.com*](mailto:jwaters@freedomkentucky.com) *and @bipps on Twitter.* ### What research really says about school choice URL: https://www.bluegrassinstitute.org/what-research-really-says-about-school-choice/ Last updated: 2025-09-08T19:57:07.000Z Cherry picking research studies to defend a particular point of view is a disreputable approach. However, it appears that a defender of the education establishment has done so, apparently to discredit the idea that every family might get to choose how their own children are educated. In a recent commentary, John Schaaf argues that research on voucher programs from Indiana and Ohio proves that school choice is bad for kids. Presumably, Schaaf wants to convince lawmakers to oppose a proposed state constitutional amendment to empower parents to make critical educational choices for their children. The first thing to note is that there is no current proposal to set up a “voucher program” in Kentucky. The bills under consideration would simply give voters the opportunity to decide if the state legislature should be allowed to establish a wide range of programs to empower families to secure education opportunities outside of traditional public schools. Those programs might involve a voucher, but they could also include charter schools, education savings accounts to pay for tutoring and other customized educational services, or scholarship tax credits. Every single state that borders Kentucky has one or more of these kinds of programs, but not all are voucher systems like Indiana’s or Ohio’s. Schaaf rests his entire argument on two studies from Indiana (in 2018) and Ohio (in 2016) that found that low-income students who participated in those states’ voucher programs tended to have lower math scores than their demographically similar peers who stayed in public schools. Schaaf fails to note that these studies are outliers in the larger body of research on private school choice programs. A 2022 survey of existing research by EdChoice found that of 17 studies on the impact of private school access programs on student achievement, 11 found positive results, four studies found there was no effect, and only three showed negative effects on student test scores (two of which were the Indiana and Ohio studies noted by Schaaf). Furthermore, five of seven studies show that education choice programs have a positive impact on educational attainment (high school graduation, college attendance, etc.), and an overwhelming 30 out of 32 studies show that parents experience significant improvements in their satisfaction with their child’s schooling experience when they utilize choice opportunities. Accidentally or intentionally, Schaaf seems to have avoided entirely the bulk of evidence regarding school choice and educational attainment. That evidence points to the effectiveness of parental choice at driving increased achievement and parental satisfaction. A school choice constitutional amendment in Kentucky serves a very simple purpose: Every family, no matter their income or zip code, should be able to choose the learning environment that is the best fit for their child. While improving a student’s score on a state standardized test is noteworthy, it is not the number one priority for most parents when they choose a school. Parents care about things like school safety, a positive culture, disciplinary practices, and the values advanced by the school. It is not up to us, or to John Schaaf or any other defender of the status quo, to decide which school is best for someone else’s children. Even the Indiana and Ohio studies’ overall results support the arguments for expanding education freedom. The enemies of giving families options constantly claim that education choice will devastate public schools. But the Indiana and Ohio studies clearly show that achievement among low-income students in public schools is not damaged by school choice. In fact, the authors of the Ohio study speculate that competition with private schools actually improved student learning outcomes in public schools. The various defenders of the education establishment miss the point that your tax dollars are not meant to benefit the public school system, but rather students themselves. Education freedom means that we should start treating education like other public goods where the beneficiary (in this case, families) gets to choose their provider (schools of various kinds). Kentucky’s school choice constitutional amendment gets us one step closer to funding students, not systems. Let your lawmakers know Kentucky families are tired of waiting. *Gary W. Houchens, Ph.D., is professor of education administration in the School of Leadership and Professional Studies at Western Kentucky University. John Garen, Ph.D., is BB&T professor emeritus of economics at the University of Kentucky. Both are Bluegrass Institute scholars.* ### Bluegrass Institute analysis of K-12 spending: Less bang for billions of Kentucky taxpayers’ bucks URL: https://www.bluegrassinstitute.org/bluegrass-institute-analysis-of-k-12-spending-less-bang-for-billions-of-kentucky-taxpayers-bucks/ Last updated: 2026-01-27T19:50:31.000Z ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/sq/1707416316379-MUMKY2I8UJBN1EOMBFXY/cover.jpg) (FRANKFORT, Ky.) – This June marks the 35th anniversary of the Kentucky Supreme Court’s famous [*Rose V. Council for Better Education*](https://nces.ed.gov/edfin/pdf/lawsuits/Rose%5Fv%5FCBE%5Fky.pdf?ref=bluegrassinstitute.org), which determined that the commonwealth failed to abide by [Section 183](https://www.bluegrassinstitute.org/content/files/Law/Constitution/Constitution/viewconstitution.pdf) of the state’s constitution requiring the legislature to “provide for an efficient system of common schools throughout the State.” “Trends in ‘Bang for the Buck’ in Kentucky’s K-12: The Productivity of Funding in Developing Basic Skills and Its Change Over Time,” a new policy point released today by the Bluegrass Institute for Public Policy Solutions, a free-market think tank, indicates a decline in the efficiency of the state’s education system since the Kentucky Education Reform Act (KERA) was enacted by the legislature in 1990 as a response to the *Rose* decision. The study, which calculates fourth- and eighth-grade reading and math test scores per $1,000 of per pupil funds – adjusted for inflation to offer an accurate portrayal of K-12 spending over decades – finds a nearly-continuous decline in the taxpayers’ bang for the billions of bucks in funding for public education since KERA was adopted as Kentucky’s education policy. “These declines are due almost entirely to the large funding increases that have occurred relative to the small changes in test scores,” writes author John Garen, Ph.D., in the report’s summary. “This suggests a large deterioration in the effectiveness of K-12 funding.” Garen is BB&T Professor Emeritus of Economics at the University of Kentucky and a member of the Bluegrass Institute Board of Scholars. Among the report’s findings: · Productivity in 2022 ranged from 47% to 64% of the 1990s level, depending on the National Assessment of Educational Progress (NAEP) test used. · The decline in productivity has been almost continuously downward from the 1990s to 2022\. The exception is the period just after the Great Recession (2009-2013). Some increases in productivity occurred then, but were driven primarily by the temporary drop in funding. · Overall, the decline in productivity suggests a marked deterioration of the effectiveness of funding in translating into basic skills test performance. “This data-driven analysis adds to the growing mountain of evidence that while Kentucky is spending more than ever of its budget pie on public education, it’s drifting farther than ever from its constitutional mandate of providing an efficiently effective system that serves students and taxpayers well,” said Bluegrass President Jim Waters. “It also confirms what reformers have said for decades: more money does not automatically result in a better education system.” “More alternatives, greater accountability and expanding education freedom are needed in order for Kentucky to meet its constitutional duty to its students and taxpayers,” Waters added. ### Why Kentucky needs school choice URL: https://www.bluegrassinstitute.org/why-kentucky-needs-school-choice/ Last updated: 2026-01-27T19:51:36.000Z A recent Tweet from a teacher (provided with that teacher’s permission) provides insight into how Kentucky’s kids can lose out without school choice. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/sq/9cbeab06-b889-4dce-9c13-dedf2a3fcc87/evidentlyreading_comment_about_charter_schools_and_reading.jpg) Here a charter school provides a second chance to students in another state when traditional schools don’t meet needs. In Kentucky, many students in a similar situation with reading (or another subject) have no such alternative available and will likely finish their school career with significant gaps in their education. Shouldn’t Kentucky’s students enjoy the benefits of school choice that students in the vast majority of other states already enjoy? ### K-12 in Kentucky: A summary of facts and trends URL: https://www.bluegrassinstitute.org/k-12-in-kentucky-a-summary-of-facts-and-trends/ Last updated: 2026-02-15T20:40:43.000Z This policy brief documents a stark disconnect between K-12 education spending and student outcomes in Kentucky. From 1990 to 2022, inflation-adjusted per-pupil funding more than doubled — rising 122% from $7,793 to $17,337 — yet NAEP test scores changed only modestly over the same period, with all four tracked metrics (grades 4 and 8 reading and math) actually declining since 2013\. Meanwhile, the racial achievement gap widened, teacher salaries barely kept pace with inflation, and the growth in education spending was absorbed largely by non-teaching staff hires and rising pension and benefit costs. [Rewarding FailureMore money has not meant better results.RewardingFailureFinal Jan 2024.pdf806 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2026/02/RewardingFailureFinal-Jan-2024.pdf "Download") **Key Takeaways** - **More money has not meant better results.** Per-pupil funding is 2.22 times its 1990 level in real terms, yet test scores are essentially flat — ranging from a 1.6% decline to an 8.8% gain — and as of 2022, over half of Kentucky students are not proficient in core subjects on the K-PREP, with NAEP results showing more than two-thirds below proficiency. - **Spending growth is going to bureaucracy and benefits, not classrooms.** Non-teaching staff grew 55% from 1990 to 2020 while student enrollment rose just 5%. Within state funding, "on behalf" payments for pensions and health benefits have surged, crowding out SEEK formula dollars and other instructional support. - **The achievement gap is getting worse, not better.** The gap between White and Black student scores widened across all four NAEP tests between 1990 and 2022, with more than 85% of Black students scoring below proficient on the national assessment — a deeply troubling equity failure despite decades of increased investment. The data presented in this report make a compelling case that Kentucky's current approach to K-12 education — channeling ever-increasing dollars through the same institutional structures — is failing students, particularly the most disadvantaged. Policymakers should take these findings as an urgent call to rethink how education dollars are allocated and to explore reforms that empower families with greater choice, direct more resources into the classroom, and hold the system accountable for results rather than simply rewarding it with more funding. ### The Safer Kentucky Act: A Summary and Analysis URL: https://www.bluegrassinstitute.org/bluegrass-institute-releases-policy-brief-on-safer-kentucky-act/ Last updated: 2026-02-06T22:19:25.000Z ## Introduction This memorandum provides a summary and analysis of the Safer Kentucky Act (“Act”), presently under consideration by the Kentucky General Assembly.[1](#%5Fftn1) The Act expands the reach of the Kentucky criminal code in a variety of ways. It creates new offenses, broadens elements, raises offense levels, increases sentences, reduces sentencing discretion, and restricts opportunities for early release. ## Subjects of Reform The Act reforms the Kentucky Revised Statutes (“KRS”) in relation to the following subjects: - Punishing Violent Crime (Generally)[](http://) - Fentanyl - Firearms - Protecting Law Enforcement - Carjacking - Workplace Violence - Domestic Violence - Homelessness - Involuntary Commitment - Juveniles - Criminal Mischief - Charitable Bail Organizations - Intimidating Participants in the Legal Process - Offender Re-Entry ### I. Punishing Violent Crime (Generally) The Act includes provisions lengthening the imprisonment of repeat “violent offenders.” Specifically, the Act increases sentences for three-time “violent offenders,” and restricts opportunities for early release for a particular class of two-time “violent offenders.” #### A. Increasing Sentences of Three-Time “Violent Offenders” The Act increases sentences of persons convicted of a “violent felony” with two or more prior “violent felony” convictions. If the current “violent felony” conviction is a capital offense, the Act mandates a sentence of death or life without parole. If the current “violent felony” conviction is not a capital offense, the Act mandates a sentence of life without parole. “Violent felony” is defined by the Act as a “felony that would classify a person as a ‘violent offender’ under Section 31.” Section 31, in turn, defines “violent offender” as a person who is convicted or pleaded guilty to one of the following: 1. A capital offense 2. A Class A felony 3. A Class B felony involving the death of the victim or serious physical injury to a victim 4. Manslaughter involving the killing of a peace officer, firefighter, or emergency medical services personnel 5. A Class B felony involving attempted murder 6. The commission or attempted commission of a felony sexual offense 7. Use of a minor in a sexual performance 8. Promoting a sexual performance by a minor 9. Unlawful transaction with a minor in the first degree 10. Human trafficking involving commercial sexual activity where the victim is a minor 11. Criminal abuse in the first degree 12. Burglary in the first degree accompanied by the commission or attempted commission of an assault 13. Burglary in the first degree accompanied by commission or attempted commission of kidnapping 14. Robbery in the first degree 15. Incest 16. Carjacking 17. A Class B felony violation of promoting contraband in the first degree 18. Wanton endangerment in the first degree2 [2](#%5Fftn2) The Act’s three-time “violent offender” provision increases sentences in two conceptual ways: it heightens sentencing ranges, and it restricts sentencing discretion. #### B. Restricting Early Release of Two-Time “Violent Offenders” In addition to increasing sentences for three-time “violent offenders,” the Act restricts opportunities for early release for a particular class of two-time “violent offenders.” As it stands, the KRS provides that a person convicted of a Class A or B felony that classifies him or her as a “violent offender” must serve 85% of an imposed term of imprisonment. The Act extends the requirement to serve 85% of an imposed term of imprisonment to a person convicted of a Class C or D felony if two conditions are met: (a) the offense of conviction classifies the person as a “violent offender”; and (b) the person was previously convicted of an offense classifying him or her as a “violent offender.” #### C. Practical Impact in Relation to the PFO Statute In sum, the Act speaks to both two-time and three-time “violent offenders.” To understand the Act’s practical impact on lengths of imprisonment, one must consider how the Act interplays with the existing KRS statute for Persistent Felony Offenders ("PFO"). The PFO statute differs from the Act’s provisions on “violent offenders” in two important ways. First, the PFO statute incorporates a different set of prior felony convictions. Unlike the Act’s “violent offender” provisions, the PFO statute: (a) is not limited to “violent” felonies; and (b) includes a sunset provision, exempting felony convictions whose related term of imprisonment (and period of supervised release) ended five or more years prior to the commission of the offense of the current conviction. Second, the implications of the PFO statute are, on balance, less severe than the Act’s “violent offender” provisions. The PFO statute requires an increase in the sentencing range of the offense of the current conviction,[\[3\]](#%5Fftn3) and prohibits early release. Unlike the Act’s provisions on “violent offenders,” the PFO statute does not mandate a sentence of death or life without parole. As a matter of practice, and considering the existing PFO statute, the marginal impact of the Act’s “violent offender” provisions on lengths of imprisonment will be contextual, depending on a defendant’s number of “violent offender” convictions, his or her PFO status, and the offense level of the current conviction. Here are several examples: ##### Example 1: Two-time “violent offender” and a PFO For a two-time “violent offender” whose current “violent offender” conviction is, say, a Class C felony and who qualifies as a PFO in the second degree, the Act has no impact on length of imprisonment. Current law: 10–20-year term of imprisonment and not eligible for early release The Act: 10–20-year term of imprisonment and not eligible for early release \[Note: The Act’s requirement that a two-time “violent offender” serve 85% of an imposed term of imprisonment is absorbed by the existing requirements of the PFO statute (i.e., prohibiting early release).\] ##### Example 2: Two-time “violent offender” but not a PFO For a two-time “violent offender” whose current “violent offender” conviction is, say, a Class C felony and who does not, for whatever reason, qualify as a PFO (say, because his or her prior felony convictions expired under the sunset clause of the PFO statute), the Act’s impact is significant. Current law: 5–10-year term of imprisonment and eligible for early release The Act: 5–10-year term of imprisonment and must serve 85% of an imposed term ##### Example 3: Three-time “violent offender” and a PFO a. Non-capital offense: For a three-time “violent offender” whose current “violent offender” conviction is, say, a Class C felony and who qualifies as a PFO in the second degree, the Act’s impact is significant. Current law: 10–20-year term of imprisonment and not eligible for early release The Act: Life without parole b. Capital offense: For a three-time “violent offender” whose current conviction is a capital offense and who qualifies as a PFO in the second degree, the Act’s impact is significant. Current law: Death, life without parole, life without parole for 25 years, or a term of imprisonment of 20-50 years (if the latter, the person is not eligible for early release) The Act: Death or life without parole ##### Example 4: Three-time “violent offender” but not a PFO a. Non-capital offense: For a three-time “violent offender” whose current “violent offender” conviction is, say, a Class C felony and who does not, for whatever reason, qualify as a PFO (say, because his or her prior felony convictions expired under the sunset clause of the PFO statute), the Act’s impact is significant. Current law: 5–10-year term of imprisonment and eligible for early release The Act: Life without parole b. Capital offense: For a three-time “violent offender” whose current conviction is a capital offense and who does not, for whatever reason, qualify as a PFO (say, because his or her prior felony convictions expired under the sunset clause of the PFO statute), the Act’s impact is significant. Current law: Death, life without parole, life without parole for 25 years, or a term of imprisonment of 20-50 years (if the latter, the person must serve 85% of the imposed term of imprisonment) The Act: Death or life without parole \[Note: These examples provide only a basic description of the interplay between the Act’s “violent offender” provisions and the existing PFO statute. It’s also important to note that institutional players have significant discretion (*de facto* if not *de jure*) to apply the KRS in selective ways to secure preferred outcomes in particular cases.\] ### II. Fentanyl The Act contains several provisions combatting fentanyl distribution. #### A. Murder The Act broadens murder to include a person who “knowingly sells fentanyl or a fentanyl derivative to another person, and the injection, ingestion, inhalation, or other introduction of the fentanyl or fentanyl derivative causes the death of the person.” Fentanyl-related murder requires a “sale.” Mere “distribution” will not suffice. Moreover, a strict reading of the text suggests that a seller is only culpable for the death of “the person” (i.e., the person who “bought” the fentanyl or fentanyl derivative). Fentanyl-related murder is a “strict liability” crime. The term “strict liability” means that one or more of the elements necessary for criminal liability does not require *mens rea* (a culpable state of mind). To be guilty of fentanyl-related murder, a person need only know he or she is selling fentanyl (or a fentanyl derivative) to another person. He or she need not know that death will occur. Under current law, a person who sells fentanyl (or a fentanyl derivative) and thereby causes the buyer’s death can typically only be charged with manslaughter in the second degree (where the buyer’s death need only be the product of the seller’s “wantonness,” i.e., the seller’s conscious disregard of a substantial and unjustifiable risk of death). Manslaughter in the second degree is a Class C felony (punishable by a 5–10-year term of imprisonment). Under the Act, the same person will be guilty of a far more serious crime (murder, a capital offense) and will receive a far more severe sentence (either death, life without parole, life without parole for 25 years, or a 20–50-year term of imprisonment). #### B. Manslaughter in the First Degree In addition to fentanyl-related murder, the Act creates the crime of fentanyl-related manslaughter in the first degree. The Act broadens manslaughter in the first degree to include a person who “knowingly distributes fentanyl or a fentanyl derivative to another person, and the injection, ingestion, inhalation, or other introduction of the fentanyl or fentanyl derivative causes the death of the person.” Fentanyl-related manslaughter in the first degree does not require a “sale.” Mere “distribution” will suffice. Under current law, a person who distributes fentanyl (or a fentanyl derivative) and thereby causes the recipient’s death can typically only be charged with manslaughter in the second degree, a Class C felony (punishable by a 5–10-year term of imprisonment). Under the Act, the same person will be guilty of a more serious offense (manslaughter in the first degree, a Class B felony) and will receive a more severe sentence (a 10–20-year term of imprisonment). #### C. Trafficking The Act increases the offense level of fentanyl trafficking crimes in situations where the trafficked fentanyl caused the death of another person. Under current law, the level of a fentanyl trafficking offense is not increased simply because the trafficked fentanyl caused death. The Act changes this, providing that a person trafficking in fentanyl will have the level of his or her trafficking offense increased by one in situations where the trafficked fentanyl caused the death of another person. For a first-time offender of the trafficking laws, the level of the fentanyl trafficking offense will be increased from a Class C felony (punishable by a 5–10-year term of imprisonment) to a Class B felony (10-20 years imprisonment). For a repeat offender of the trafficking laws, the level of the fentanyl trafficking offense will be increased from a Class B felony (punishable by a 10-20 year term of imprisonment) to a Class A felony (life or a 20–50-year term of imprisonment).[\[4\]](#%5Fftn4) #### D. Promoting Contraband Under current law, the offense of promoting contraband in the first degree prohibits a person from “knowingly introduc\[ing\] dangerous contraband into a detention facility or a penitentiary,” or when confined in a detention facility or a penitentiary, “knowingly mak\[ing\], obtain\[ing\], or possess\[ing\] dangerous contraband.” The offense is a Class D felony (punishable by a 1–5-year term of imprisonment). The Act provides that in a situation where the “dangerous contraband” is “fentanyl, carfentanil, or a fentanyl derivative,” the offense is increased to a Class B felony (punishable by a 10-20 year term of imprisonment), and the person is classified as a “violent offender” (meaning the person must serve 85% of an imposed term of imprisonment). ### III. Firearms The Act includes several provisions relating to firearms. #### A. Wanton Endangerment Under current law, a person is guilty of the offense of wanton endangerment in the first degree “when, under circumstances manifesting extreme indifference to the value of human life, he or she wantonly engages in conduct which creates a substantial danger of death or serious physical injury to another person.” This offense is a Class D felony (punishable by a 1–5-year term of imprisonment). The Act provides that in situations where the “person discharges a firearm in the commission of the offense,” wanton endangerment in the first degree is increased to a Class C felony (punishable by a 5-10 year term of imprisonment), and the person is classified as a “violent offender” (meaning the person must serve 85% of an imposed term of imprisonment). #### B. Auctions for Confiscated Firearms The current law provides that firearms lawfully confiscated during criminal investigations shall be sold at public auctions to “licensed firearms dealers.” The Act sets forth an alternative option, expanding the list of eligible auction bidders to “any person” who certifies prior to bid that he or she will leave the firearm with state police for destruction. The Act clarifies that the provision is limited to firearms used in homicides and that bids may not be made by a “state or local government or agency.” #### C. Restricting Early Release The Act prohibits early release from a term of imprisonment for certain crimes involving firearms. It provides that there shall be no early release if “in the commission of an offense” the defendant “used a firearm which was possessed in violation of state law, including firearms which are stolen, defaced, or loaded with restricted ammunition.” It is important to note that the “use” of a firearm requires more than simple possession. *See* *Darden v. Commonwealth,* 52 S.W.3d 574, 577 (Ky. 2001) (“We believe the terms ‘possession of a weapon’ and ‘use of a weapon’ are two entirely different concepts.”). ### IV. Protecting Law Enforcement The Act includes several provisions protecting law enforcement. #### A. Murder of a First Responder The Act creates the crime of murder of a first responder. A person is guilty of murder of a first responder “when, with the intent to cause the death of a first responder, he or she causes the death of the first responder.” Under current law, an act causing the death of another person with intent is murder, which is a capital offense (and as such, punishable by death, life without parole, life without parole for 25 years, or a 20–50-year term of imprisonment). The crime of murder of a first responder marginally expands the overall reach of the criminal code, insomuch as it restricts sentencing discretion and requires a sentence of death or life without parole. In addition, the Act increases the level of the offense of attempted murder when the victim is a first responder. Under current law, attempted murder is a Class A felony (punishable by life or a 20-50 year term of imprisonment).[\[5\]](#%5Fftn5) The Act raises the level of attempted murder when the victim is a first responder to a capital offense (punishable by life without parole for 20 years, life without parole for 25 years, or a 20-50 year term of imprisonment).[\[6\]](#%5Fftn6) The Act provides that if the victim was “a parent or guardian of a minor child or dependent” the sentencing court “may order the defendant to pay restitution in the form of financial support for the child or dependent.” #### B. Fleeing or Evading Police The Act amends the crime of fleeing or evading police in the first degree. A person is guilty of this crime if he or she disobeys a police officer’s directive to stop his or her vehicle after committing an act of domestic violence, or driving under the influence, or driving on a suspended license. If on foot, a person is guilty if he or she disobeys an officer’s directive to stop after committing an act of domestic violence, or if, while fleeing, he or she creates a substantial risk of serious physical injury to others. The Act increases the level of this offense from a Class D felony (punishable by a 1–5-year term of imprisonment) to a Class C felony (5-10 years imprisonment). It also prohibits release before 50% of an imposed sentence is served. This marks a substantial change in the law. Under the current law, a person guilty of this offense faces 1-5 years of imprisonment, with an opportunity for early release. Under the Act, the same person faces 5-10 years imprisonment, with no opportunity for release before serving 50% of the imposed term of imprisonment. The Act similarly amends the crime of fleeing or evading police in the second degree. A person is guilty of fleeing or evading police in the second degree if he or she refuses to comply with an order to stop by an officer with reasonable suspicion and causes or creates a substantial risk of physical injury to others. The Act enhances the level of this offense from a Class A misdemeanor to a Class D felony. It also prohibits release before 50% of an imposed sentence is served. Under the current law, a person guilty of this offense faces 90-365 days of imprisonment, with an opportunity for early release. Under the Act, the same person faces 1-5 years imprisonment, with no opportunity for release before serving 50% of an imposed term of imprisonment. ### V. Carjacking The Act creates the crime of carjacking, a Class B felony (punishable by a 10–20-year term of imprisonment). The Act provides: A person is guilty of carjacking when he or she takes a motor vehicle in the possession of another, from the possessor's person or immediate presence, or from the person or immediate presence of a passenger of the motor vehicle, against the possessor's or passenger's will and with the intent to either permanently or temporarily deprive the possessor of the motor vehicle of his or her possession, accomplished by means of force or intimidation. It is worth noting that the crime does not require the use of a weapon, but only “force or intimidation.” Nor does it require a “permanent deprivation.” A “temporary deprivation” (such as a joyride) will suffice. Moreover, the victim need not be inside the car at any point. The Act classifies a person convicted of carjacking as a “violent offender” (meaning he or she must serve 85% of an imposed term of imprisonment). ### VI. Workplace Violence The Act includes several provisions protecting the workplace. #### A. Terroristic Threatening The Act amends the crime of terroristic threatening. Under current law, terroristic threatening in the first degree prohibits threats to use a “weapon of mass destruction” in places enumerated in the KRS as protected, including schools, government buildings, and domestic violence shelters. This is a Class C felony (punishable by a 5–10-year term of imprisonment). The Act expands the list of protected places to include “any workplace; or any real property or any building, public or private, that is the site of any gathering of three or more persons.” Under current law, terroristic threatening in the second degree prohibits threats to commit an act likely to result in death or serious physical injury. The KRS provides that a threat need not identify a specific victim, so long as it was made in a place enumerated in the KRS as protected. This is a Class C felony (punishable by a 5–10-year term of imprisonment). The Act expands the list of protected places to include a “workplace, or gathering of three or more persons.” #### B. Justifiable Use of Force The Act expands the scope of justifiable force against suspected shoplifters to include “a reasonable amount of force” by security officers, merchants, or merchant’s employees “necessary to protect himself or herself and to prevent the escape of the person detained or the loss of goods for sales.” Under current law, such persons are authorized to “detain” suspected shoplifters. The Act goes further, clarifying and expanding the circumstances where force is justifiable. Moreover, the Act provides that persons are immune from criminal and civil liability for any harm or damage caused using justifiable force. ### VII. Domestic Violence The Act includes several provisions protecting victims of domestic violence. #### A. Redefining “Serious Physical Injury” Many crimes in the KRS – notably assault – require a “serious physical injury.” The KRS defines “serious physical injury” as “physical injury which creates a substantial risk of death, or which causes serious and prolonged disfigurement, prolonged impairment of health, prolonged loss or impairment of the function of any bodily organ, or eye damage or visual impairment.” Importantly, the KRS gives a broader definition to “serious physical injury” if the victim is a child 12 years of age or less. This broader definition of “serious physical injury” includes “bruising near the eye,” as well as a host of other injuries enumerated in the KRS. The Act expands the application of the broader definition of “serious physical injury,” from a child 12 years of age or less to “any person if the relationship between the perpetrator and the victim meets the definition of a family member or member of an unmarried couple . . . or dating relationship.” Under current law, “bruising near the eye” on a victim over 12 years of age is not, by itself, a “serious physical injury,” but rather a “physical injury.” Acts causing “physical injury” constitute assault in the third degree, a Class D felony (punishable by a 1–5-year term of imprisonment). Under the Act, the same injury on a victim (of any age) in a domestic context is classified as a “serious physical injury” and thereby meets the standard for assault in the second degree, a Class C felony (punishable by a 5-10 year term of imprisonment), and if a dangerous weapon or instrument was used, assault in the first degree, a Class B felony (punishable by a 10-20-year term of imprisonment). #### B. Protective Orders The Act increases the offense level for a second violation of a protective order. The KRS provides that violations are Class A misdemeanors (punishable by a 90–365-day term of imprisonment). Under the Act, a second violation within five years constitutes a Class D felony (1-5-years’ imprisonment). ### VIII. Homelessness The Act includes several provisions relating to homelessness. #### A. Crime of Unlawful Camping The Act creates the crime of unlawful camping. It provides that “a person is guilty of unlawful camping when he or she knowingly enters or remains on a public or private street, sidewalk, area under a bridge or underpass, path, park, or other area designated for use by pedestrians or vehicles, including areas used for ingress or egress to businesses, homes, or public buildings, with the intent to sleep or camp in that area, when the area has not been designated for the purpose of sleeping or camping or the individual lacks authorization to sleep or camp in the area.” For first-time offenders, it is a mere violation (with no possibility of imprisonment). For repeat offenders, it is a Class B misdemeanor (punishable by a 0-90-day term of imprisonment). #### B. Justifiable Use of Force The Act expands the scope of justifiable force by private persons against unlawful campers. The Act states that “the use of physical force by a defendant upon another person is justifiable when the defendant believes that such force is immediately necessary to prevent . . . \[t\]he commission of unlawful camping . . . when the offense is occurring on property owned or leased by the defendant, the individual has been told to cease, and the individual has used force or threatened to use force against the defendant.” Under current law, force by private persons is justifiable if immediately necessary to, among other things, prevent a criminal trespass. Criminal trespass is limited by the KRS to unlawful intrusions into dwellings, or upon real property withinanenclosure (such as fencing). The Act expands the scope of justifiable force, authorizing the use of force against unlawful campers on un-enclosed real property (i.e., where there has been no criminal trespass). #### C. Miscellaneous The Act provides that local governments “may” provide indoor or outdoor areas for temporary camping for homeless individuals, but if they do so, they “must” provide portable water and adequate sanitary facilities. The Act provides that local governments “shall not adopt or enforce any policy under which it directly or indirectly prohibits or discourages the enforcement of laws about unlawful camping.” To facilitate the enforcement of this provision, the Act authorizes the Attorney General to bring a civil action. The Act limits the use of public funds to support “any initiatives” providing “permanent housing to homeless individuals,” requiring that recipients of such funds must impose behavioral and rehabilitative requirements on tenants, including, at a minimum, prohibitions on criminal activity and the excessive use of alcohol. ### IX. Involuntary Commitment The Act eases the standards for involuntary commitment of persons found incompetent to stand trial. Under current law, a person deemed incompetent to stand trial shall not be involuntarily committed unless he or she has, among other things, “a demonstrated history of criminal behavior that has endangered or caused injury to others or has a substantial history of involuntary hospitalizations . . . prior to the commission of the charged crime.” The Act removes this requirement, authorizing involuntary commitment based only upon a determination that the person “presents a danger to self or others as a result of his or her mental condition,” the person “needs care, training, or treatment in order to mitigate or prevent substantial physical harm to self or others,” and “a less restrictive alternative mode of treatment would endanger the safety of the respondent or others." ### X. Juveniles The Act includes three provisions relating to juveniles. #### A. Conspiracy with a Minor The Act expands criminal liability for persons engaging in a criminal conspiracy with a minor. It provides: “Any person who engages in a criminal conspiracy with a minor shall be charged one level higher than the level provided for the offense which is the object of the conspiratorial agreement.” #### B. Custodian Attendance at Juvenile Proceedings The Act requires courts to order custodian attendance at juvenile proceedings. Under current law, a court “may” require a custodian’s attendance. The Act amends this provision, stating that courts “shall” order attendance of “one person exercising custodial control.” In cases of non-compliance, courts shall impose a $500 fine and require 40 hours of community service. #### C. Reporting Requirements for School Employees The Act requires school employees to immediately contact law enforcement if they have “reasonable cause to believe” certain crimes enumerated in the KRS have been committed on school property or at a school-sponsored event. ### XI. Criminal Mischief The Act amends the crime of criminal mischief (which includes “defacing, damaging, or destroying property”). The KRS distinguishes first degree criminal mischief (a Class D felony, punishable by a 1–5-year term of imprisonment) from second degree criminal mischief (a Class A misdemeanor, punishable by a 90-365-day term of imprisonment) based on the amount of damage caused. The Act lowers the threshold amount of damage for first degree criminal mischief (from $1000 to $500). It also requires that the offense level of first- or second-degree criminal mischief be reduced to a Class B misdemeanor (0-90 days imprisonment) if the defendant repairs damaged property, performs court-ordered community service, or provides “complete restitution” at any time prior to trial. ### XII. Charitable Bail Organizations The Act places limits on bail and bonds provided by “charitable bail organizations.” Such organizations may not furnish bail or bonds in an amount over $5000, or in any amount for a person alleged to have committed an offense of domestic violence or an offense that would classify the person as a “violent offender.” The Act mandates that unlawful funds be transferred to the victims of the related crimes. Moreover, the Act requires “charitable bail organizations” to publish detailed annual reports. The term “charitable bail organizations” is confined to 501(c)(3) organizations. As a result, the Act’s provisions do not restrict organizations willing to forego 501(c)(3) status. ### XIII. Intimidating Participants in the Legal Process Under current law, the offense of intimidating a participant in the legal process (such as a witness) requires the use of “physical force” or “a threat directed to a person.” The Act broadens the offense to include “harassing communications.” ### XIV. Offender Re-Entry The Act includes several provisions impacting offender re-entry. #### A. Data on Recidivism The KRS requires the Kentucky Justice & Public Safety Cabinet to report data to the Governor, Legislative Research Commission, and Corrections Commission. The Act requires the cabinet to include in its report “the percentage of offenders participating in each reentry program operated by, or operated under contract with, the department who commit a new criminal offense within two years of their release from custody.” #### B. Conditions of Release The Act supplements the list of conditions a court may impose on a prisoner who is released early. Under the Act, a court may require a prisoner upon release to participate in a program designed to reduce violence. #### C. Personal ID Card The KRS directs the Transportation Cabinet to issue a personal identification card to felony offenders released from the Kentucky Department of Corrections or a federal prison in Kentucky. The Act expands this directive to include felony offenders released from “a county jail or other local or regional correctional facility.” #### D. Parole Board The Act provides that grants of parole require a unanimous panel vote, or, if not, a two-thirds vote of the full board. ## Conclusion The Act expands the reach of the Kentucky criminal code in a variety of ways. It creates new offenses, broadens elements, raises offense levels, increases sentences, reduces sentencing discretion, and restricts opportunities for early release. --- Endnotes: [\[1\]](#%5Fftnref1) The bill was introduced on January 9, 2024\. H.B. 5, 2024 Reg. Sess. (Ky. 2024). [\[2\]](#%5Fftnref2) In addition to increasing sentences for three-time “violent offenders,” and restricting eligibility for early release of two-time “violent offenders,” the Act adds to the enumerated list of offenses that classify a person as a “violent offender.” In particular, the Act adds subsections (p), (q), and (r), and broadens the text of subsection (e) to cover all attempted murders. [\[3\]](#%5Fftnref3) The PFO statute typically raises the sentencing range of a person’s offense of conviction by one level. But under certain circumstances, the PFO statute will raise the sentencing range of an offense by two levels. For example, a PFO in the first degree convicted of a Class D felony will be sentenced in the range otherwise designated for Class B felonies. [\[4\]](#%5Fftnref4) Defendants sentenced to life imprisonment for a Class A felony are eligible for release after twenty years. [\[5\]](#%5Fftnref5) Defendants sentenced to life imprisonment for a Class A felony are eligible for release after twenty years. [\[6\]](#%5Fftnref6) The Act removes death and life without parole as eligible sentences for this capital offense. [The Safer Kentucky Act: A Summary and AnalysisHB 5 creates new offenses, increases sentences and restricts early-release opportunitiesA summary and analysis of the 'Safer Kentucky Act'.pdf587 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2025/09/A-summary-and-analysis-of-the--Safer-Kentucky-Act-.pdf "Download") ### Universal preschool won’t solve Kindergarten readiness issues in Kentucky URL: https://www.bluegrassinstitute.org/universal-preschool-wont-solve-kindergarten-readiness-issues-in-kentucky/ Last updated: 2026-06-01T15:51:55.000Z Kentucky Governor Andy Beshear posted this Tweet just before Christmas. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/sq/e8897b49-cd4d-4fd3-a9b5-cefa2da91299/beshear_tweet_with_wrong_assertion_about_universal_preschool.jpg) Maybe he thought no one would spot this assertion is just a sack of coal. This table shows 2022-23 data collected by the Kentucky Department of Education from its annually administered Kindergarten Screener assessment (Spreadsheet online [here](http://tinyurl.com/4ja5z9wp?ref=bluegrassinstitute.org)). ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/sq/3ce2c52b-bc74-40a8-b52c-1e3fbbf7c2b3/kindergarten_readiness_2023_table.jpg) The top row of data shows that among all entering Kindergarteners, 38% directly tested as ready and another 8% would be ready if they get enrichments. So, the state considers a total of 46% of the entering Kindergarteners were ready. That means 54% were not ready for Kindergarten, which agrees with the percentage the governor cites in his blog. But, as the late Paul Harvey used to point out, there is a “rest” to this story, and the next two rows of data in the table have that information. The middle line of data covers entering Kindergarteners who previously had attended the state-funded preschool program. Even though they attended the state’s official program, only 46% of them were ready! The last row of data covers the federally funded Head Start program’s results. Only 43% of these students were ready even with enrichments. The table shows actual results for real preschool programs operating right now. These results provide NO indication that putting every child into preschool is going to perform miracles. In fact, performance of the two main preschool options in Kentucky doesn’t look any better than the overall performance that includes students coming in from other options such as parent-funded child care, education in the home, or other, unidentified options. Shouldn’t we figure out how to really do preschool right, first, before we spend a lot more money on it? Otherwise, both students and the taxpayers will be the ones winding up with the real sack of coal. ### Why it’s wrong to deny Kentucky’s students the benefit of public charter schools URL: https://www.bluegrassinstitute.org/why-its-wrong-to-deny-kentuckys-students-the-benefit-of-public-charter-schools/ Last updated: 2026-07-23T22:13:27.000Z Once you start to compare the National Assessment of Educational Progress (NAEP) scores for students in Florida’s charter schools to those in Kentucky, where there are no charter schools, the commonwealth’s need for this important school choice option becomes readily apparent. The table below shows the 2022 results from the NAEP Grade 4 Reading Assessment. For Florida, scores for both students in that state’s public charter school system (shaded in yellow) and those in the state’s traditional public schools (shaded in green) are shown Because Kentucky has no charter schools, you will only find scores for the Bluegrass State listed in the green not a charter school area. Let’s look at some interesting comparisons. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/sq/c3a69f04-4330-4efa-a288-6b8074d6a172/grade_4_reading_by_race_and_charter.jpg) First, note in the green shaded area that white students in Kentucky’s traditional schools scored 220 on NAEP Grade 4 Reading. Now, check out the Florida charter school student scores. Not only did the white students in Florida’s charter schools outscore Kentucky’s whites, but it looks like Charter school Black and Hispanic students in Florida outscored Kentucky’s whites – yes, Kentucky’s whites, as well! Next, consider some achievement gaps. The white minus Black achievement gap in Florida’s charter schools was 10 NAEP Scale Score points. The white minus Black gap in Kentucky’s traditional schools was 20 points – TWICE as large. The white minus Hispanic score gap in Florida’s charters was just 8 NAEP Scale Score Points. Kentucky’s white minus Hispanic gap was 13 points, again notably larger. Finally, let’s deal with the argument that charter schools damage traditional schools. If you look at the scores in the green area of the table you will see that Florida’s traditional public school students have outscored their racial counterparts in Kentucky, as well. This factual performance data will help better understand the Bluegrass Institute’s press release’s [dismay](https://bipps.org/blog/bluegrass-institute-issues-statement-on-franklin-circuit-courts-charter-school-ruling?ref=bluegrassinstitute.org) with the Franklin Circuit Court ruling that Kentucky cannot have charter schools. As that press release notes: ***“Today’s ruling by Franklin Circuit Judge Phillip Shepherd denies Kentucky families whose children remain trapped in failing schools the opportunity of enrolling their children in charter schools – a public-school option available to parents in 45 other states, including many with which Kentucky competes for population growth and economic development.”*** Hopefully, justices who will likely hear an appeal of this ruling will consider what charter schools can do for Kentucky’s students along with the fact that charter schools are also public schools and come to a much better decision for our children. Until that happens, students in Florida’s charter school system will likely to continue to see Kentucky’s kids far back in their rearview mirrors. ### Franklin Circuit Court's charter-school ruling: Our founders would not agree URL: https://www.bluegrassinstitute.org/bluegrass-institute-issues-statement-on-franklin-circuit-courts-charter-school-ruling/ Last updated: 2026-03-16T14:56:21.000Z *The Bluegrass Institute issued the following statement in response to the Franklin Circuit Court’s* [*ruling*](https://www.kentucky.com/news/local/education/article282928848.html?ref=bluegrassinstitute.org) *deeming charter-school legislation passed by the General Assembly in 2022 unconstitutional.* [*House Bill 9*](https://apps.legislature.ky.gov/record/22rs/hb9.html?ref=bluegrassinstitute.org) *creates a funding mechanism for public charter schools in Kentucky, and requires the establishment of two pilot charters – one in Jefferson County and the other one in Northern Kentucky.* Today’s ruling by Franklin Circuit Judge Phillip Shepherd denies Kentucky families whose children remain trapped in failing schools the opportunity of enrolling their children in charter schools – a public-school option available to parents in 45 other states, including many with which Kentucky competes for population growth and economic development. This ruling also goes against the respected opinions of great legal minds like Paul Clement, the nation’s former Solicitor General, who [concludes:](https://edreform.com/wp-content/uploads/2017/02/KY-Charter-Schools-White-Paper.pdf?ref=bluegrassinstitute.org) “whatever obstacles to the creation of charter schools may exist, the Kentucky Constitution should not be one of them.” The Kentucky Supreme Court will doubtless be the final arbiter regarding the constitutionality of HB 9\. That court should consider the fact that these schools are changing the educational trajectory of millions of at-risk students nationwide. Surely, our commonwealth’s founders would not have opposed such an important and positive policy. More than 7,800 public charter schools now educate 3.8 million students in 44 states and the District of Columbia. A [majority](https://data.publiccharters.org/digest/charter-school-data-digest/who-attends-charter-schools/?ref=bluegrassinstitute.org#:~:text=Charter%20schools%20historically%20serve%20proportionately,color%20compared%20to%20district%20schools.) of these students are minorities from low-income homes whose parents cannot afford a private-school tuition or an expensive move to a better school district. We urge the Kentucky Supreme Court to carefully consider the fact that charter schools are: · public schools managed differently than traditional public schools; · free of some of the regulations that deny great teachers and hungry students the opportunity for a stellar education that works better for them; · schools of choice. Unlike traditional public schools, students are not assigned to charters. Parents must choose them, which creates the strongest accountability of any approach to public education. If parents are dissatisfied with the performance of a charter school, or if charters fail to meet the performance standards they agree to in their “charters” or are guilty of financial malfeasance, they can be closed. Disingenuous claims by opponents of educational freedom that offering parents alternatives would destroy public education ring hollow in light of improvement in academic outcomes in states expanding alternatives for parents. For example, Florida’s public schools’ academic performance has steadily improved as the state expanded education freedom while spending notably less per pupil than Kentucky. More than [380,000 students attended over 700 public charter schools](https://www.fldoe.org/schools/school-choice/charter-schools/?ref=bluegrassinstitute.org#:~:text=About%20Florida's%20Charter%20Schools&text=Since%201996%2C%20the%20number%20of,%28PDF%29%20for%20more%20details.) in 46 districts in Florida during the 2022-23 school year. Meanwhile, the Bluegrass State’s education performance, particularly in key academic areas, has shown little improvement while per-pupil spending has risen by a whopping inflation-adjusted 80% since passage of the Kentucky Education Reform Act 33 years ago. We urge the Kentucky Supreme Court to end the embarrassment of the commonwealth being the only state in America with an enabling charter-school law but no existing public charter schools. ### Energy one of the three ‘E’s’ of Kentucky campaigns URL: https://www.bluegrassinstitute.org/energy-one-of-the-three-es-of-kentucky-campaigns/ Last updated: 2026-07-23T22:15:44.000Z ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/sq/1629682178804-VVCNSNJ5BSM48VG0XPWS/beacon_logo.png) While Kentucky’s economy and education policy and practices have dominated political headlines during this election year, no gubernatorial campaign in Kentucky would be complete without considering candidates’ views on energy, particularly as they relate to coal. After rolling blackouts during last winter’s storms, the Kentucky General Assembly passed legislation earlier this year requiring utility companies to get the Public Service Commission’s (PSC) approval before retiring coal-fired power plants. [Senate Bill 4](https://apps.legislature.ky.gov/record/23rs/sb4.html?ref=bluegrassinstitute.org) was sponsored by Sen. Robby Mills, R-Henderson, running mate of Daniel Cameron, the state’s attorney general and Republican candidate for governor. The legislation requires utilities to show that such closures, among other things, won’t negatively affect the reliability and resiliency of the electric transmission grid or force ratepayers to cover the “incremental costs” of the retirement. Democratic Gov. Andy Beshear, who’s running for reelection, allowed the bill to become law – without either his signature or stated support. Louisville Gas and Electric and Kentucky Utilities, both owned by PPL Corporation, collectively make up the state’s largest utility with more than a million ratepayers, vigorously opposed SB 4 and is [seeking closure](https://kentuckylantern.com/2023/05/15/kentuckys-largest-utility-tests-new-law-creating-barrier-to-retire-fossil-fuel-plants/?ref=bluegrassinstitute.org) from the PSC of coal-fired units in Jefferson, Carroll and Mercer counties. The utility wants to replace them with natural gas, solar and a battery energy storage system. Cameron’s office opposes the request and [staunchly defended](https://www.kentucky.gov/Pages/Activity-stream.aspx?n=AttorneyGeneral&prId=1461&ref=bluegrassinstitute.org) the bill in court, writing in a brief submitted to the PSC that while renewable energy sources like wind and solar may be all the rage currently, they are “causing reliability concerns in places where dispatchable energy is being lost and replaced with solar and wind.” It [urged](https://www.ag.ky.gov/Press%20Release%20Attachments/23.09.22%20OAG%20Post-Hearing%20Brief%20and%20Exhibits.pdf?ref=bluegrassinstitute.org) the commission to “make its decision not on what is new and popular but on what will work. Now is not the time for speculation or for placing the cost of massive new renewable projects onto the back of ratepayers. The prudent thing is to continue utilizing Kentucky’s existing coal plants.” By the time you read this, commissioners may have made their decision about LG&E and KU Energy’s request. But they will not have settled the debate over what role fossil fuels – especially coal – will play in the future of our country and commonwealth. Beshear gives the obligatory nod to coal required of any politician seeking statewide office in a state among the nation’s top producers of the black rock. But he’s also chosen not to wade so far into the issue as to put him at odds with the more radical elements of his party, whose dreams of an energy utopia are pushing aside ratepayers’ and industry leaders’ concerns regarding an affordable, available supply. The governor’s been silent while intervening parties in the PSC case like the leftist Kentuckians for the Commonwealth and Mountain Association have attacked the source of energy that’s provided our commonwealth’s families with some of the nations’ lowest energy costs and raised and supported families since the first commercial coal mine opened in Muhlenberg County in 1820. These radical intervening parties in the PSC case even [criticized](https://www.thetimestribune.com/kentucky/coal-fired-power-failures-during-winter-storm-come-to-light-months-later/article%5F9d37c0cc-6eb7-11ee-a193-5f9deb56f4e6.html?ref=bluegrassinstitute.org#:~:text=We%20deserve%20to%20know%20in,well%2C%E2%80%9D%20Chambers%20Armstrong%20said.&text=When%20LG%26E%20and%20KU%20issued,prevent%20even%20wider%2C%20longer%20blackouts.) LG&E and KU Energy for proposing to replace their coal-powered generating stations with natural gas operations rather than going completely with wind and solar. But the technical reality is that renewables, though they can supplement our fossil fuels, aren’t going to replace them at any point in the near future. Building an energy policy solely around renewables rather than viewing them as supplementary sources would harm Kentucky more than most states. In a [letter](https://www.bluegrassinstitute.org/content/files/wp-content/uploads/2022/07/2021-07-13%5Ftcampbell-to-president-biden.pdf) to President Biden concerning the reliability of our nation’s electric grid a couple of years ago, East Kentucky Power Cooperative CEO Anthony Campbell painted “the emerging picture” as being one of “an electric grid that is steadily becoming less fuel secure.” Our governor wiggles out of uncomfortable conversations about energy by awkwardly claiming support for an “all the above” energy policy, thus giving equal credence to wind and solar as he does fossil fuels, which have powered Kentucky for the past two centuries. According to the U.S. Energy Information Administration (EIA), coal in 2022 [generated 68%](https://www.eia.gov/state/analysis.php?sid=KY&ref=bluegrassinstitute.org#:~:text=In%202022%2C%20coal%20generated%2068,after%20West%20Virginia%20and%20Wyoming.) of Kentucky’s in-state electricity, a larger share than all but two other states. Coal has also given us some of the nations’ lowest electric rates, a primary reason for the record increases in manufacturing operations and growth that Beshear praises on the campaign trail. Renewables simply aren’t able to make such a majority contribution. The EIA says [less than 1%](https://www.eia.gov/state/analysis.php?sid=KY&ref=bluegrassinstitute.org#:~:text=In%202022%2C%20coal%20generated%2068,after%20West%20Virginia%20and%20Wyoming.) of Kentucky’s current energy needs are met by wind and solar. Even LG&E and KU Energy admit that their proposed new solar facilities’ winter-time capacity will be no more than about 16%, compared to more than 60% filled by coal with natural gas filling nearly 25% of their volume. Opponents of fossil fuels, who live to send us and our economy back to horse-and-buggy days – point with glee to [testimony](https://www.thetimestribune.com/kentucky/coal-fired-power-failures-during-winter-storm-come-to-light-months-later/article%5F9d37c0cc-6eb7-11ee-a193-5f9deb56f4e6.html?ref=bluegrassinstitute.org#:~:text=We%20deserve%20to%20know%20in,well%2C%E2%80%9D%20Chambers%20Armstrong%20said.&text=When%20LG%26E%20and%20KU%20issued,prevent%20even%20wider%2C%20longer%20blackouts.) in August from LG&E and KU’s CEO Lonnie Bellar indicating that last year’s extreme temperatures and mechanical failures caused even some coal-fired facilities to freeze up or go offline during last year’s storms. “See! See!” opponents say, “coal isn’t as reliable as conservatives claim.” But that response doesn’t pass the logic test. How, for example, would reducing our coal-generating capacity even further and replacing it with even-less-reliable sources contribute to preventing future blackouts? Cameron acknowledges the ongoing energy transition. The issue, though, as he states in his [brief](https://www.ag.ky.gov/Press%20Release%20Attachments/23.09.22%20OAG%20Post-Hearing%20Brief%20and%20Exhibits.pdf?ref=bluegrassinstitute.org), is: “How do we achieve the best outcome from this transition? One thing is for certain: relying solely on hope and ignoring the laws of physics and engineering will only ensure failure.” Beshear would do well to remember this as he seeks another term governing a state which sits on nearly 90 billion tons of coal even after more than 200 years of mining. Don’t we need to hear more about how he, if reelected, would use such a God-given plentiful energy source to advance future economic growth and prosperity in our state? *Jim Waters is president and CEO of the Bluegrass Institute for Public Policy Solutions, Kentucky’s free market think tank. Reach him at jwaters@freedomkentucky.com and @bipps on Twitter.* ### First thoughts on the new Kentucky Assessment and Accountability Results URL: https://www.bluegrassinstitute.org/first-thoughts-on-the-new-kentucky-assessment-and-accountability-results/ Last updated: 2025-09-07T21:42:13.000Z The media seems to have done a fair job with their initial coverage of the scores, but there are troubling things as well that not all have picked up on. For example, a US News and World Report painted a rather rosy picture, with an article titled “[Kentucky Report Card Shows Some Improvement in Student Test Scores but Considerable Work Ahead](https://www.usnews.com/news/best-states/kentucky/articles/2023-11-01/kentucky-report-card-shows-some-improvement-in-student-test-scores-but-considerable-work-ahead?ref=bluegrassinstitute.org).” I don’t think that captures the real picture very well. While there were some areas of improvement, there also were areas where scores stayed flat or even declined from 2022 to 2023\. They include: Elementary School: editing and mechanics (a subset of the writing area), Middle School: math and social studies, and, most troubling, High School: reading, math, science and editing and mechanics. More problematic is the implication in the USN&WR title about improvement. The Kentucky Summative Assessments (KSA) used in 2023 only were implemented for full-scale testing in 2022 (2021 KSA participation was decimated by COVID). As I discuss [here](https://bipps.org/blog/with-covid-and-a-new-kentucky-state-assessment-program-hitting-us-at-the-same-time-what-can-we-make-from-the-latest-school-assessment-results?ref=bluegrassinstitute.org), KSA results don’t really compare to earlier testing from 2019 and before when a different test series, the Kentucky Performance Rating for Educational Progress (KPREP), was in use. Basically, implementation of the KSA destroyed the trend line back to the pre-COVID era. So, we can’t get reliable information from the KSA about improvement relative to pre-pandemic performance. The only Kentucky run testing that provides a trend line of testing information, and it’s only available for high schools, is from the ACT college entrance test. Kentucky has given the ACT to all high school juniors for more than a decade. As you can see in the first table, which was extracted directly from the KDE’s [Briefing Packet, State Release 2022-2023 Assessment and Accountability Results](https://education.ky.gov/comm/Documents/Kentucky%20School%20Report%20Card%20Briefing%20Packet%202023%20final.pdf?ref=bluegrassinstitute.org), back in 2018-19 the 11th grade ACT Composite Score was 19.0 and in 2022-23 it was only 18.5\. This is up slightly from the 18.3 posted in 2022, but none of the listed scores for individual subjects or the overall Composite Score were as high in 2022-23 as they were before COVID. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/sq/04780202-3d8d-4433-a421-148199d6ec56/act_grade_11_scores_2019_to_2023_from_kde.jpg) And, overall, until we get more results from another test that has been rather stable through the COVID era, the National Assessment of Educational Progress, next due in 2024, getting a real handle on the COVID recovery in Kentucky is going to be sketchy, at best. I have a few more thoughts about the new Accountability rating system in Kentucky. The 5-star system is gone, and now we have a 5-color system, instead. And, the system is scored very differently, with all sorts of factors considered such as test scores, change in test scores from last year, school climate and safety, graduation rates (for high schools), and more. But, with so many variables added into the scoring formula, it is easy for important stuff to get watered down in the ratings. This next table shows the 10 top-rated high schools in the new, 2022-23 scoring. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/sq/d9a2dc4d-48c0-4812-9b6a-ef583c35afe9/top_10_high_schools_in_2023_ky_accountability_system.jpg) The second table first lists each school’s final score for the overall combined indicator rate along with the ranking for the school for that rate. I then show each school’s 2023 Grade 11 ACT Composite Score and the school’s ranking for that score. Next, I compare the proficiency rate for the state’s Kentucky Summative Assessment in Math and that metric’s ranking to the school’s score for ACT math and the ranking for that ACT academic area. I think as you look through the various ranking entries, you will see that there is an interesting situation for a number of the top 10 schools. They might rank high using the scheme to mix a lot of stuff together to develop just one final number, but in the important area of academic performance, there is a problem. For example, top-ranked Dawson Springs Jr./Sr. High School posted a rather weak ACT Composite score of 18.1, which ranked only in the 112th place, about half way down the list of Kentucky high schools. Drop down a little further, and Green County High School did even worse on the ACT, with a 17.9 ACT Composite Score that ranked 124th. Equally of concern, looking at the comparison of KSA math to ACT math, the rankings are also disturbingly different for some of these supposedly top of the stack high schools. Green County High ranked 19th for KSA math but was way down in 105th place for ACT math. My initial impression is that the KSA math standard is notably lower than ACT’s. Perhaps something else is going on here, however, and discussion is definitely needed. In fact, a good hard look at the state’s new accountability scoring system is clearly needed, as well. How did Dawson Springs Jr./Sr. High get such a high rating from Kentucky when its students clearly don’t measure up well on the ACT even just against students in other Kentucky public high schools? Are we getting the right stuff, here? Someone needs to find out. ### Anticompetitive certificate of need laws: Wrong prescription with serious side effects URL: https://www.bluegrassinstitute.org/anticompetitive-certificate-of-need-laws-wrong-prescription-with-serious-side-effects/ Last updated: 2026-03-16T14:58:52.000Z *Editor’s note: The Bluegrass Beacon is a weekly syndicated newspaper column posted on the Bluegrass Institute’s website after appearing in publications statewide.* Lawmakers who oppose repealing Kentucky’s certificate of need requirements limiting medical providers from opening new facilities or expanding existing ones argue that getting rid of the misguided policy will cause rural hospitals to close, leaving many poor patients without adequate health care in their communities. Providing privately insured customers with choices, they reason, would result in [financial hardship for rural hospitals](https://youtu.be/M4k7b9zxoq8?ref=bluegrassinstitute.org) who depend on charging full-paying clients more for their surgeries than a freestanding surgical facility might charge to cover the costs of the majority of their patients who depend on Medicaid or Medicare to fund their care. Since miserly reimbursement rates paid by the federal government for Medicare and Medicaid often don’t cover the full cost of services, supporters of keeping certificate of need requirements claim that denying full-paying patients the benefits of lower prices and better quality produced by competition is the only way to save our rural hospitals. Even if hospitals’ care for indigent patients was being subsidized by “full freight” patients, which [credible research indicates isn’t happening](https://www.bluegrassinstitute.org/content/files/CommitteeDocuments/380/26823/09-18-2023-3--cavanaugh-testimony.pdf), the data doesn’t support claims that certificate of need results in improving access to care. Instead, those facts strongly suggest it’s the wrong prescription with harmful side effects for our state’s healthcare policy. Kentucky has lost four rural hospitals since 2005 with another 10 facing closure at any time. Obviously, certificate of need laws haven’t helped rural facilities. Jaimie Cavanaugh, an attorney with the Institute for Justice, a national nonprofit public interest law firm, and West Virginia University researcher Matthew Mitchell recently reviewed Kentucky’s certificate of need laws. They told members of a legislative task force that no rural hospitals have closed since 2005 in [several states](https://www.bluegrassinstitute.org/content/files/CommitteeDocuments/380/26823/09-18-2023-3--cavanaugh-testimony.pdf) without certificate of need laws, including Colorado, Idaho, Utah and Wyoming. Could the fearmongering about rural hospitals closing if the commonwealth ends its anticompetitive certificate of need law be a ruse perpetrated by incumbent providers to reduce competition and keep healthcare entrepreneurs out? Kentucky’s policy currently aids such monopolizing by requiring applicants who want to open a new facility or expand an existing one to get permission from existing providers, who can veto applications for [32 services](https://ij.org/report/striving-for-better-care/con-laws-in-kentucky/?ref=bluegrassinstitute.org), as well as state government’s approval. It comes as no surprise, then, that services on that list are lacking, or missing altogether. There are, for example, [no freestanding birthing centers](https://www.richmondregister.com/kentucky/free-standing-birth-centers-would-no-longer-be-subject-to-competitors-veto-under-bills-awaiting/article%5Fb15c96ba-b7f4-11ed-955c-73f44b010748.html?ref=bluegrassinstitute.org) in the state, forcing Kentucky women who want that option to travel to another state. More scanning centers are also urgently needed, but would-be applicants are discouraged from even applying for a certificate by the stringent regulations and ability of existing providers to nix applications. In their review of Kentucky’s certificate of need approvals and denials published by the Institute for Justice, Cavanaugh and Mitchell found that incumbent providers’ opposition reduced the approval rate by [more than half](https://ij.org/report/striving-for-better-care/con-laws-in-kentucky/?ref=bluegrassinstitute.org) for projects requiring applicants to prove the need for new ambulance services, additional beds at psychiatric facilities or one of the other many services and technologies. The review also found that the Cabinet for Health and Family, the state’s largest and costliest bureaucracy, denied 35 certificate of need applications between January 1, 2019, and mid-May 2023. Not only are those 35 services and technologies that could save or improve the quality of lives – especially for our rural citizens – but how many entrepreneurs were discouraged from applying due to the regulatory hassle, cost and length of time required to even get an answer regarding an application? Most would-be applicants “give up without even trying,” Cavanaugh said. “Patients in the average CON state have access to fewer hospitals, fewer ambulatory surgical centers (ASCs), fewer dialysis facilities, fewer imaging centers, and fewer rural hospitals per capita, among other things,” according to the review by Cavanaugh and Mitchell. Michell testified that an objective look at hundreds of reports and tests indicates that certificate of need regulations drive up health care costs and spending while reducing efficiency. Kentucky, he noted, has the [third-most](https://www.bluegrassinstitute.org/content/files/CommitteeDocuments/380/26823/09-18-2023-4--mitchell-presentation.pdf) certificate of need requirements in the nation. Replacing our state’s onerous certificate of need laws with incentives for healthcare entrepreneurs to provide more choices is the right prescription. “Economic analysis finds the competition is [an important force](https://youtu.be/M4k7b9zxoq8?ref=bluegrassinstitute.org) in markets to generate lower prices, better quality, and more efficiency,” Bluegrass Institute Scholar John Garen, Ph.D., BB&T Professor Emeritus of Economics at the University of Kentucky, told the state task force. “Any interference with the competitive process is presumptive harmful. Certificate-of-need law … impedes entry of additional providers into markets.” It’s a strange phenomenon to see some normally conservative lawmakers become so adamant about defending one of Kentucky’s most anti-competitive policies. Its most vocal defenders are those whose background is in administration at long-existing facilities, primarily hospitals. They argue that because our struggling healthcare system no longer resembles much of a free market, we must protect the monopoly and double down on maintaining anticompetitive practices to ensure the continued availability of some services. Such logic reminds me of a past president who defended government bailouts of existing financial firms in order to save the economy, claiming he “had to abandon free-market principles in order to save the free market system.” We must not follow free-market principles only when it's convenient. Adhering to those tenets when it’s most inconvenient is often when it’s most needed. *Jim Waters is president and CEO of the Bluegrass Institute for Public Policy Solutions, Kentucky’s free market think tank. Reach him at* [*jwaters@freedomkentucky.com*](mailto:jwaters@freedomkentucky.com) *and @bipps on Twitter.* ### More for taxpayers means more for government, too URL: https://www.bluegrassinstitute.org/more-for-taxpayers-means-more-for-government-too/ Last updated: 2026-07-23T22:15:01.000Z ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/sq/1629682178804-VVCNSNJ5BSM48VG0XPWS/beacon_logo.png) *Editor’s note: The Bluegrass Beacon is a weekly syndicated newspaper column posted on the Bluegrass Institute’s website after appearing in publications statewide.* The recent announcement by the state Budget Director’s office that Kentucky brought in a record $15 billion in General Fund revenues during the previous fiscal year is good news for taxpayers, despite the grousing by advocates of bigger government and the spending hikes to fund it. For taxpayers, the state’s record revenues – including $1.4 billion more than forecast for Fiscal 2023 – will likely trigger another cut in the individual income tax, from 4% to 3.5% in 2025\. The General Assembly earlier this year reduced the rate from 4.5% to 4% for 2024 as a result of stout revenues last year as well. These cuts were put in motion by [legislation](https://apps.legislature.ky.gov/record/22rs/hb8.html?ref=bluegrassinstitute.org) in 2022 that immediately cut the individual income tax rate from 5% to 4.5% and established a process for phasing the tax out altogether in increments of half-percentage points as long as receipts and reserves remain strong. It’s a responsible approach that includes a backstop requiring final legislative approval, allowing lawmakers to adjust in case of a precipitous downturn or devastating disaster between when the previous year’s revenue numbers are released in July and the next legislative session convenes in January. Opponents of lowering the tax rate overstate the negative impact of the reduction on individual income tax receipts. They also discount the increase in other revenue streams and overall positive results of moving toward a tax policy that encourages the kind of economic growth we’re seeing in Kentucky and benchmark states. Jason Bailey, executive director of the Kentucky Center for Economic Policy, bemoans the fact that income tax receipts have dropped as a result of the rate reduction. “Well duh,” as my teenage daughter might say. Why wouldn’t we expect that less revenue would be collected from individual income taxes if we lowered the rate? But is the proper response by Frankfort, as Bailey suggests, to quit passing these modest cuts in the income tax rate and allow Kentuckians to keep more of their own money? Absolutely not, especially in light of the fact that while revenues from income tax receipts may have dropped, proceeds from other streams significantly increased due to strong economic growth. Thus, there’s still plenty of money to fund government. The $5.6 billion collected in sales-and-use taxes last fiscal year was [on par with](https://www.bluegrassinstitute.org/content/files/recorddocuments/note/22RS/hb8/fn.pdf) the $5.8 billion produced by individual income taxes. (Remaining revenues come from corporate income, property, coal severance and cigarette taxes.) Bailey ignores this in his analysis, offering a straw-man argument about “some people who claim that lowering the rate will [somehow spur](https://www.wkms.org/government-politics/2023-07-11/kentucky-reports-another-record-surplus-will-it-lead-to-a-third-income-tax-cut?ref=bluegrassinstitute.org) new economic activities such that receipts won’t drop, and we’re not seeing that here.” There’s never been an expectation that individual income tax receipts wouldn’t drop. Indeed, the fact they’re dropping while revenues raised from consumption taxes is rising offers confirmation that Kentucky’s on the right path to becoming competitive again. Other pro-growth states like Indiana to our north and our southern neighbor, Tennessee, have reduced or eliminated income taxes altogether and are experiencing unprecedented growth. Bailey’s analysis of the revenue numbers and what they mean for the state come complete with griping about a lack of spending – nothing new to see here – and his claims, as reported by the Kentucky Lantern, that by continuing to cut the individual income tax rate, legislators risk [“blow(ing) a hole](https://www.wkms.org/government-politics/2023-07-11/kentucky-reports-another-record-surplus-will-it-lead-to-a-third-income-tax-cut?ref=bluegrassinstitute.org) in state funding for education and other services in the budget” in the likely event of a future economic recession. How would more spending by government – the motif central to all of Bailey’s themes – help guard against the impact of recessions? Bailey is analyzing in denial. Not only are we having record surpluses, but the legislature is spending at record levels, including significant increases in K-12 education. The huge budget surpluses have also made it possible for lawmakers to spend a half-billion dollars for relief in both the western and eastern parts of the commonwealth slammed by natural disasters without raising taxes or sweeping funds from other needed programs. But no matter how much Frankfort spends on education or flood relief or most anything else, it will never be enough for Bailey. His proclivities – and those of his tax-and-spend political twin, Gov. Andy Beshear – for more government and the spending hikes to fund it are never satisfied. For example, Bailey doesn’t praise the legislature’s substantial funding increases for local school districts to cover pay increases for teachers and other needs. Apparently, it doesn’t fit his pre-contrived narrative, and therefore gets downplayed. Bailey’s claims lose even more credibility with his unfounded and preposterous allegation that “in an attempt to meet the trigger conditions (required to reduce the income tax rate), the General Assembly has suppressed spending in the current budget.” Income tax cuts are triggered by revenues before decisions are made about how they will be spent. The fact is, robust revenue growth has occurred since the income tax-rate cuts began. Even Beshear says Kentucky’s economy is “on fire.” Coincidental? Doubtful. While factors other than the income-tax reduction likely contribute to the growth of the state – like right-to-work and public pension reforms – the historically proven principle for growth is reconfirmed: Allow individuals to keep more of their hard-earned money and don’t punish them for *more* work and *more* productivity, like income taxes do. The result? Taxpayers will have more in their pockets and government will have more in its coffers. *Jim Waters is president and CEO of the Bluegrass Institute for Public Policy Solutions, Kentucky’s free market think tank. Reach him at jwaters@freedomkentucky.com and @bipps on Twitter.* ### CON laws interfere with competition, 'impedes entry of additional providers into markets' URL: https://www.bluegrassinstitute.org/con-laws-interfere-with-competition-impedes-entry-of-additional-providers-into-markets/ Last updated: 2025-09-15T00:50:35.000Z A movement is afoot in Kentucky to get rid of the state’s bureaucratic requirements that health care providers get special permission from the government before adding or expanding services or facilities. While the origin of such policies – known as certificate-of-need laws – which began as a federal policies in the 1970s, were intended to help control healthcare costs, increase quality and improve access to care for low-income families. However, the research doesn’t confirm that certificate-of-need laws have achieved any of those expectations. Instead, such policies have served primarily to shield existing hospitals, doctors and other medical providers from the competition that new facilities and services would provide Kentuckians. “The weight of evidence implies that Kentucky would be well-served by the improved access to healthcare that is stimulated by the removal of certificate of need,” Bluegrass Institute Scholar John Garen, Ph.D., recently told the state task force examining Kentucky’s Certificate of Need laws. “Economic analysis finds the competition is an important force in markets to generate lower prices, better quality, and more efficiency,” Garen, BB&T Professor Emeritus of Economics at the University of Kentucky, told the task force. “Any interference with the competitive process is presumptive harmful. Certificate-of-need law … impedes entry of additional providers into markets,” he added. ### Testimony to the Kentucky Certificate of Need Task Force URL: https://www.bluegrassinstitute.org/testimony-to-the-kentucky-certificate-of-need-task-force/ Last updated: 2025-09-10T17:10:19.000Z John Garen, a scholar at the Bluegrass Institute, presents evidence on certificate of need policies to the Kentucky Certificate of Need Task Force on August 8, 2023. ### School choice, school politicking and public school legislation URL: https://www.bluegrassinstitute.org/school-choice-school-politicking-and-public-school-legislation/ Last updated: 2025-09-10T23:37:02.000Z Parents are increasingly concerned about the content and effectiveness of public schools’ curriculum as well as the openness of school officials to hearing and responding to their concerns. These concerns seem especially grave regarding gender/sexual issues and critical race theory topics. As a result, many have called for greater transparency regarding these issues, and for curricular matters generally, as well as for greater openness and responsiveness of school administrators to parents’ views. In this vein, the General Assembly recently passed [Senate Bill 5](https://apps.legislature.ky.gov/record/23rs/sb5.html?ref=bluegrassinstitute.org) that addresses sexual material in schools. Transparency in this respect – and regarding other school matters such as curriculum and safety – as well as responsiveness to parents are extremely important and SB 5 is a step in the right direction. But I view this legislation as a complement to – not a substitute for – broad and robust school choice for Kentucky parents. Information about each school’s curriculum, practices and openness is of substantial assistance to parents in determining whether a school is right for their child. Indeed, schools that must compete for students expect to be open and provide a great deal of information to parents. Openness and information themselves, however, are not effective substitutes for parental choice and school competition. If a parent determines that the public school practices are wrong for their child, how can it be addressed? Under the usual circumstances, the parent lodges a complaint with the school, and if nothing is done, may engage in a time-consuming process of appealing to or schmoozing higher levels of the public school bureaucracy. Alternatively, a parent might initiate the difficult political process of fashioning a majority of parents or cobbling together a big enough parental interest group to influence district and school policies. But these efforts often fail. All the while their child suffers. SB 5 shortens this process with respect to parental objections to sexual material in school libraries. It requires a relatively fast review by the school principal and, if needed, by the local school board. Also, parents are able to exempt their children from exposure to objectionable material. By the way, this has nothing to do with “book banning.” School libraries cannot possibly carry every book published. Decisions must be made about which books to carry. SB 5 requires that parents be brought into the decision-making process regarding appropriate books to hold. But notice that this took an act of the state legislature to accomplish – itself a sizable political task. And it addresses only one aspect of potential parent concerns about their public school. What if a parent finds deep dissatisfaction in other aspects of the local school? Of course, parents might, and sometimes do, move to a different school district or catchment zone to find a better situation for their children. However, this is a burdensome way for parents to find schools best suited to meet their children’s needs. In a system of parental choice with robust competition amongst schools, the dissatisfied parent simply moves their child to another school. End of story. No need to engage in political wrangling and arm-twisting. No need to change residences. To attain a strong system of school choice and competition, it looks as though Kentucky needs an [amendment](https://apps.legislature.ky.gov/record/23rs/hb174.html?ref=bluegrassinstitute.org) to our state constitution, followed by strong legislation enabling school choice. This cannot happen until 2024\. In the meantime, we’re reliant on the state legislature to press public schools to be more responsive to parents. While the latter is helpful, deeper improvements in the commonwealth’s schooling system await greater choice and competition. Parents have real control of their kids’ education when they control the purse strings, that is, when money follows the student and parents choose schools that best suit their kids. This is far superior to having to play politics. *John Garen, Ph.D., is BB&T Professor Emeritus of Economics at the University of Kentucky and a Bluegrass Institute Scholar.* ### Chorus of concerns raised in hearing about crime bill’s cost, consequences URL: https://www.bluegrassinstitute.org/chorus-of-concerns-raised-in-hearing-about-crime-bills-cost-consequences/ Last updated: 2026-01-07T14:29:05.000Z Following Tuesday’s floor session of the state Senate, that body’s judiciary committee met in a special-called meeting to hear discussion on [House Bill 5](https://apps.legislature.ky.gov/record/24rs/hb5.html?ref=bluegrassinstitute.org#amendments), a large crime bill called the “Safer Kentucky Act.” (Watch the entire hearing [here.](https://bit.ly/3TzucnB?ref=bluegrassinstitute.org)) No vote was taken (that’s scheduled for Thursday), but there were a chorus of concerns raised about cost and consequences. The more this bill gets examined and debated, the more the following becomes apparent: · Parts of this bill are well-founded, including movement toward Truth in Sentencing, punishing violent offenders and those with violent intentions, punishing those who victimize first responders and children and increasing protections of the victims of domestic violence. Broken out into separate bills, several portions of HB 5 would enjoy substantial – even bipartisan – support. Taking that approach would be the equivalent of using a scalpel rather than a sledgehammer, which HB 5 does in some places by incorporating many different comprehensive parts into one large bill. · [Our recent policy brief](https://www.bluegrassinstitute.org/bluegrass-institute-releases-policy-brief-on-safer-kentucky-act/) summarizing and analyzing HB 5 conclude the legislation expands the reach of the Kentucky criminal code in a variety of ways. It creates new offenses, broadens elements, raises offense levels, increases sentences, reduces sentencing discretion and restricts opportunities for early release. That growing chorus of concerns focused in Tuesday’s hearing on the apparent lack of empirical evidence offered regarding these long-term and costly changes this bill makes to Kentucky’s criminal justice policy, and whether its approach toward toughening sentences and putting new crimes on the book will effectively result in reducing criminal activity across the commonwealth. Some of HB 5’s proposals will, no doubt, do just that, but the evidence is circumstantial, at best. In his testimony to the committee on Tuesday, Joey Comley, Kentucky Director of Right on Crime, told legislators: “Consequences alone will not solve Kentucky’s crime problem.” (See my recent *Kentucky’s Voice* interview with Comley [here](https://bipps.org/blog/kentucky-right-on-crime-director-the-good-the-bad-and-the-unknown?ref=bluegrassinstitute.org), which includes a discussion of the crime bill.) · Some legislators who seem to prefer the sledgehammer approach toward creating criminal-justice policies become defensive when issues of cost are raised. But the fiscal data provided by the Legislative Research Commission for HB 5 is, at best, incomplete and inadequate in determining this bill’s price tag, including the additional cost of locking offenders up for longer periods of time, or the impact of its mandates on local governments. The naïve among us believe any legislation claiming to address crime should be passed – no matter its cost or lack of data-driven solutions – and that opposing it means you’re “soft on crime.” But that’s like asserting any bill claiming to protect our nation should be passed, whatever wasteful - or unsubstantiated - spending or lack of proven policies it may contain, and that anyone even questioning, or certainly opposing, such a bill is “soft on security.” Reasonable Kentuckians want policies that reduce crime and recidivism, and keep our state and neighborhoods safe, but that are also fiscally responsible. Protecting lives and property is part of the fabric of our nation. However, policies that lengthen prison sentences and add corrections’ burdens on local communities must be based on sound data and accomplish what all reasonable Kentuckians want: a reduction in crime and safe communities. Before spending hundreds of millions of dollars on a huge bill, wouldn’t it be prudent to make sure such an investment actually will provide the desired results? ### Know much about Black history? URL: https://www.bluegrassinstitute.org/know-much-about-black-history-2/ Last updated: 2025-10-17T13:47:25.000Z It’s Black History Month. Over the next few weeks, our nation will recognize struggles and contributions of Black Americans, whose history – unlike that of any other race – is one of enslavement and severe discrimination. Throughout February, you can read about some of those contributions and great Black Americans who made them on the Bluegrass Institute Policy Blog. George Washington Carver, for example, rose from the slavery into which he was born and the South’s post-Civil War impoverishment to become a celebrated scientist and educator. Getting a stellar education was a top priority for Carver, the first Black to attend what’s now Iowa State, where he earned a Master of Science degree. He's also the first of his race to become a member of that school’s faculty. Carver took that degree and went to the famous Tuskegee University and headed the school’s agricultural department for many years, where his research resulted in providing American farmers with more modern farming techniques. He also laid the foundation for a prosperous South by moving it away from an over-dependence on cotton – the farming of which depleted the soil of nutrients – and developing crop-rotation methods using peanuts, sweet potatoes and soybeans to replenish farmland. Markets for peanuts and sweet potatoes were initially weak. So, Carver researched how they could be used as raw materials for many useful products like flour, ink, dyes and plastic. The peanut, which wasn’t even considered an American cash crop when Carver received his master’s degree in 1896, became one of the nation’s six leading crops by the start of World War II. Yet while many considered Carver the most renowned Black scientist of the early 20th century, there’s no guarantee Kentucky students will learn about his inspiring life story and earth-shattering discoveries. Neither the current Kentucky Academic Standards for Social Studies nor the draft of its proposed replacement even mention him. Buried next to Carver on Tuskegee’s grounds is Booker Washington, who, though he spent the first nine years of his life as a slave, went on to become Tuskegee’s first president and one of the nation’s primary advocates for racial equality. Some in the intellectual Black community would later criticize Washington because he advocated for Blacks concentrating on developing skills, claiming those were more important than pursuing a higher education and full and equal political impact. It was a controversial position, one which W.E.B. Du Bois, another prominent Black, claimed represented an “old attitude of adjustment and submission.” Du Bois criticized Washington for being just an advocate instead of a warrior for racial equality. But there’s a lesson here that, if our history teachers would include it, would be helpful toward understanding and easing racial tensions. Washington’s cautious approach enabled Blacks to leave plantations, hold jobs and make a living – the right approach for that time, but which also laid the groundwork for future equality. By the time Du Bois came along, his message had become right for that time and beyond: if you’re not willing to fight for freedom, you’re not going to get it. An objective consideration must admit both men were relevant for their times. Washington and Du Bois were not only well-educated but both were influential, understanding their contemporary environments and courageously leading the nation to progress. Fortunately, by voting last year to require students [study papers by both men](https://bipps.org/blog/historic-black-figures-get-into-kentuckys-social-studies-standards-only-because-the-legislature-required-it?ref=bluegrassinstitute.org) as part of the state’s social studies’ standards, Kentucky’s legislature confirms its understanding that both men’s perspectives have played a key role in America’s racial progress. Allow me a modern analogy. Calling out the National Guard so Blacks can attend public schools was a past day’s *issue du jour*. Ensuring Black students today receive equality of educational excellence in those classrooms to which they were once denied entrance and unfettered freedom to attend school elsewhere if they don't is now *the* issue and an important factor in Kentucky’s own evolving narrative of liberty. On that, Washington, Carver and Du Bois would most certainly agree. *Jim Waters is president and CEO of the* [*Bluegrass Institute*](https://www.bluegrassinstitute.org/)*, Kentucky’s free market think tank.* ### It’s historic – When Black students get school choice, they make progress URL: https://www.bluegrassinstitute.org/its-historic-when-black-students-get-school-choice-they-make-progress/ Last updated: 2026-03-16T15:54:45.000Z It’s Black History Month, and we’ve already looked at an example from Kentucky – which offers essentially no school choice to its public school students – of how the state’s Black students in particular have not made progress in over 30 years of KERA reforms. Now, let’s see where some great Black history is happening in schools, namely charter schools in both Atlanta and Cleveland. The tables below show the National Assessment of Educational Progress (NAEP) results for Black students in Atlanta and Cleveland from 2019. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/sq/221662f7-7d3c-4c2b-bb27-37b69cf0fc0b/atlanta_black_charter_results_2019.jpg) ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/sq/dfbc56de-3c52-4a04-ad8f-81b9ed09312c/cleveland_black_charter_results_2019.jpg) As you can see, as of the last data before COVID really messed up education, Black students fortunate enough to attend public charter schools in both cities have outdistanced the Blacks in their city’s traditional public schools – and in the schools in Kentucky’s Jefferson County School District, as well. It’s historic. Given better education options, Black students can do better. How much better? Well, a number of researchers who work with the NAEP say a difference of 10 NAEP Scale Score points is equivalent to an extra year of learning. As we said, it’s historic. NAEP scores obtained from the [NAEP Data Explorer](https://www.nationsreportcard.gov/ndecore/landing?ref=bluegrassinstitute.org). ### State of the Commonwealth: Getting stronger due to free-market policies, not gubernatorial politics URL: https://www.bluegrassinstitute.org/state-of-the-commonwealth-getting-stronger-due-to-free-market-policies-not-gubernatorial-politics/ Last updated: 2025-07-23T14:06:56.000Z *Editor’s note: The Bluegrass Beacon is a weekly syndicated newspaper column posted on the Bluegrass Institute’s website after appearing in publications statewide.* This year’s elections will determine whether Gov. Andy Beshear gave his final [State of the Commonwealth](https://www.youtube.com/watch?v=hUk8dYK5CSs&ref=bluegrassinstitute.org) speech recently. Regardless, Kentucky’s economy will likely continue its current pro-growth trajectory if the General Assembly persists in implementing the type of fiscally responsible policies Beshear enthusiastically vetoes then later claims the fruit they bear as his successes. “With the books closed on 2022, I can announce we’ve now secured the best two-year period for economic growth in state history,” Beshear rightly reported in his speech. There’s no doubt it’s been a prosperous stretch for the state – 800 new relocation or expansion projects promising more than 40,000 new jobs and $24 billion in new investment. But, would Beshear have signed [House Bill 1](https://apps.legislature.ky.gov/record/17rs/hb1.html?ref=bluegrassinstitute.org) making Kentucky a right-to-work state had he been governor in 2017? Not only would he have not signed it, but – based on his present treatment of a myriad of economically competitive policies– he would have vetoed it and actively campaigned against individual workers being free to not pay union dues without losing their jobs. Yet, as we have often emphasized in this space, becoming a right-to-work state along with lower taxes, less government spending, pension and education reform, will attract employers – including the manufacturers we now see arriving – who increasingly find themselves looking to leave states with policies that erode liberties while making the cost of doing business climb ever higher. Ironically, that record economic growth Beshear claimed wouldn’t have happened had his big-spending and even-bigger-government mindset prevailed. Just as ironic, proof of that statement is found in his reporting – we’ve had the best two-year period for economic development, job growth, budget surpluses and “the longest period of the lowest unemployment rate in state history.” But it’s all happened because voters increasingly choose candidates favoring economic freedom while obviously moving away from the governor’s favored approach of progressive redistribution. A press release from the governor’s office claimed “he will [preside](https://www.kentucky.gov/Pages/Activity-stream.aspx?n=GovernorBeshear&prId=1619&ref=bluegrassinstitute.org) over the four highest years of state budget surpluses in the commonwealth’s history.” Laying aside for a moment the fact that it’s the legislature that “presides” over the budget process determining how tax dollars get spent, let’s give Beshear some political due. It’s all very Clintonesque in the sense that the former president opposed welfare reform legislation before it grew legs in the Republican Congress. So, Clinton made welfare reform the center – and a winning issue – in his reelection campaign, and has succeeded in embedding it into his political legacy. But don’t mistake Beshear’s political prowess for strong principles which produce the increased opportunity we’re witnessing. As another famous president who from beyond is cheering the Kentucky legislature’s march toward more economic freedom once quipped, while – as we also give credit where it’s due – paraphrasing Ralph Waldo Emerson: “There is no limit to the amount of good you can do if you don’t care who gets the credit.” It’s more about what happens next. While Kentucky has taken some long strides, much remains to be done before we reach the mountain top. What happened in November’s election positively indicates that Kentucky will continue to experience the kind of growth Beshear likes to trumpet after the fact while opposing in real time those policies producing it. More principled and fiscally conservative policymakers fill General Assembly seats than perhaps ever before. They can, and should, sufficiently frustrate Beshear’s desire to stop policies that reduce tax burdens, deny parents school choice and use our historically large budget reserves as government slush funds, which he – again and super-ironically – has trumpeted as being the strongest in our state’s history even while proposing spending that fund down as quickly as lawmakers built it up during the past two years. Those policies – rather than the governor’s petty politics – will make the biggest difference in making Kentucky fully competitive again. *Jim Waters is president and CEO of the Bluegrass Institute for Public Policy Solutions, Kentucky’s free market think tank. Reach him at* [*jwaters@freedomkentucky.com*](mailto:jwaters@freedomkentucky.com) *and @bipps on Twitter.* ### Bluegrass Institute responds to anti-charter school lawsuit URL: https://www.bluegrassinstitute.org/bluegrass-institute-responds-to-anti-charter-school-lawsuit/ Last updated: 2025-09-09T14:46:08.000Z **For Immediate Release: Tuesday, Jan. 10, 2023** **Contact: Jim Waters @ (270) 320-4376 jwaters@freedomkemtucky.com** *The Bluegrass Institute for Public Policy Solutions issued the following statement in response to the filing of a lawsuit by the so-called “Council for Better Education” claiming* *House Bill 9* *, which funds charter schools and requires two pilot program charters to open – one each in Jefferson County and Northern Kentucky – was passed by the 2022 legislative session, is unconstitutional.* Opponents of educational liberty want the courts to deny Kentucky parents access to public charter schools, an educational alternative now approved by our legislature and already available to families in almost every other state. Charter schools are public schools in which parents choose to enroll children. They are free from many of the regulations that hamper learning in traditional public schools, letting them be more innovative and focused on the needs of students. Kentucky lawmakers originally passed a bill allowing the creation of public charter schools in 2017; then, last year’s legislation – passed after years of debate – established their funding apparatus. In return for the flexibility granted them, public charter schools contract to perform at higher academic levels after a sufficient amount of time working with students who had generally fallen well behind and weren’t receiving the education they needed from traditional public schools. If successful, this lawsuit will result in many Kentucky parents continuing to be denied an affordable option for better PUBLIC educations for their children – an opportunity available to families in 44 other states and the District of Columbia. Such denial would also prohibit a policy that’s spurred improvements in academic performance in traditional public schools in many other places, including Indiana, [Florida](https://bipps.org/blog/if-were-talking-about-impacts-of-school-choice-lets-look-at-real-examples-more-on-kentucky-and-florida?ref=bluegrassinstitute.org), [Atlanta](https://bipps.org/blog/charter-schools-in-atlanta-do-much-better-for-black-students-for-half-the-cost?ref=bluegrassinstitute.org), [Cleveland](https://bipps.org/blog/surprise-black-students-in-good-charter-school-systems-do-outperform?ref=bluegrassinstitute.org) and Chicago. The competition from school choice creates a rising tide that lifts all boats in public education, whether in traditional or charter schools. Considering [these](https://www.bluegrassinstitute.org/s/AA-Achievement-Gaps-in-Kentucky-Wheres-the-Progress-Handout-2022-Update-9yjf.pdf) growing white minus Black achievement gaps in Kentucky’s traditional public schools for fourth- and eighth-grade in the critical areas of math and reading – gaps being closed in many charter schools around the country – Kentucky’s education establishment ought to foster, rather than oppose, the creation, funding and support of these proven public alternatives. Shouldn’t a group calling itself the “Council for Better Education” be supporting programs that create educational success rather than spending taxpayer dollars to file lawsuits to keep such policies out of Kentucky? Charters have existed for nearly 30 years and nearly 3.5 million students now attend 7,700 of these innovative public schools nationwide. It’s time give Kentucky’s children – especially those who are the neediest and most at-risk – access to these proven educational alternatives, too. ### What a difference a word makes URL: https://www.bluegrassinstitute.org/what-a-difference-a-word-makes-2/ Last updated: 2025-10-16T18:39:16.000Z Moving from one year to the next may “only” involve the turning of a calendar’s page or changing a single number – from a “2” to a “3” as in “2022” to “2023,” but it also means many new opportunities lie before us. So, too, can adding a single word in state law offer Kentuckians prospects for significant health-care savings and access to needed medicine. Lawmakers should seriously consider doing just that during the new General Assembly session by adding “biosimilar” to legislation passed last year. That’s it. This one-word legislative tweak would allow health plans to require biosimilars be prescribed as an alternative to the original – and usually much-more expensive – biologic drugs when available and appropriate at a doctor’s discretion, just like pharmacists can switch out brand-name drugs with their chemical equivalents once patents expire. Pharmaceutical producers of brand-name drugs must have sufficient time as the lone player to recoup their investments as exclusive providers. This allows drug companies to sufficiently profit and thus incentivizes them to continue investing in critical research and development of new and needed cures. But they must not be allowed to keep lower-cost alternatives out of the marketplace forever. Ironically, lower-cost biosimilars address diseases highlighted by those annoying – and costly – advertising campaigns to push expensive brand-name drugs for ailments involving all types of conditions, from chronic skin diseases and rheumatoid arthritis to diabetes and cancer. At the same time, big pharma inflates its lobbying budgets to fool legislators who want their constituents to have access to safe, affordable options. No doubt Kentucky lawmakers thought they were covering all available alternatives during the 2022 legislative session when they overwhelmingly passed [Senate Bill 140](https://apps.legislature.ky.gov/record/22rs/sb140.html?ref=bluegrassinstitute.org) establishing “step therapy protocols.” The bill allows insurers to – when available and appropriate, and with a doctor’s approval – require patients to at least try using alternatives before being prescribed the higher-cost brand name drug. While the legislation mentioned generics and “interchangeable” biological products as allowable steps in the treatment process, it left out “biosimilar.” Pharma lobbyists bent on protecting the turf of the higher-priced branded drugs know this is a significant omission. They know “interchangeable” doesn’t mean “more thoroughly assessed” or “safer.” They know the only difference between a “biosimilar” designated as “interchangeable” is that the producer of that drug, which closely copies the original biologic, has spent $150 million on additional but unnecessary studies. Pharma’s representatives know that biosimilars must navigate the rigorous FDA-approval maze just like any other drug to gain approval for use in the health-care marketplace, making all that extra spending largely duplicative and redundant – additional costs that get passed on to patients in the form of higher drug prices. They also know the fact that attaining the “interchangeable” designation allows pharmacists to disseminate these drugs is also largely a moot point since physicians, not pharmacists, primarily handle biosimilars. Most, in fact, are dispensed in hospitals and doctors’ offices, where physicians directly and closely oversee their distribution. Pharma lobbyists know all this, but are content to keep competitors out of the marketplace, which drives up costs, while keeping lawmakers who aren’t medical experts in the dark. Tactics used during the 2022 legislative session to ensure “biosimilars” didn’t get included in SB 140 involved failing to enlist policymakers who are health-care experts to lead on the legislation. Instead, the bill’s well-meaning sponsors had unrelated backgrounds. The U.S. is the only country designating this difference between “biosimilars” and “interchangeable” products, keeping health care costs artificially high and access out of reach – especially for financially challenged Kentuckians. According to the Association for Accessible Medicines, biosimilars provided the same level of treatment but at [less than half the cost](https://accessiblemeds.org/sites/default/files/2021-10/AAM-2021-US-Generic-Biosimilar-Medicines-Savings-Report-web.pdf%5d?ref=bluegrassinstitute.org) of brand-name products in 2020 and project they will save Americans [$130 billion](https://d.docs.live.net/e47a148afc12ade3/Desktop/LD/2022/2022%20Beacon/12.29.22/Health%20Plans%20Should%20Prioritize%20Biosimilars?ref=bluegrassinstitute.org) by 2025\. Kentuckians with conditions that can be treated by lower-cost biosimilars – and our commonwealth as a whole – can reap a good chunk of those savings with, again, simply a word. *Jim Waters is president and CEO of the Bluegrass Institute for Public Policy Solutions, Kentucky’s free market think tank.* ### Is NAEP's 'Proficient or Above' Achievement Level Valid? URL: https://www.bluegrassinstitute.org/is-naeps-proficient-or-above-achievement-level-valid/ Last updated: 2025-10-22T15:01:00.000Z [Is NAEP's 'Proficient or Above' Achievement Level Valid naepOct22Is NAEP's 'Proficient or Above' Achievement Level Valid naepOct22.pdf10 MBdownload-circle](https://www.bluegrassinstitute.org/content/files/2025/10/Is-NAEP-s--Proficient-or-Above---Achievement-Level-Valid-naepOct22.pdf "Download") This report examines whether [NAEP](https://nces.ed.gov/nationsreportcard/?ref=bluegrassinstitute.org)'s "Proficient" benchmark validly measures student achievement by comparing Kentucky's NAEP Grade 8 scores to ACT college readiness data. The analysis reveals NAEP Proficient scores closely align with ACT readiness benchmarks across all student groups, while Kentucky's state test (KPREP) inflates proficiency rates by 15-18 points. The findings validate NAEP's standards as accurate indicators of college/career readiness and confirm that low proficiency rates—only 34% nationally in Grade 4 reading—reflect genuine preparation gaps, not unrealistic expectations. - **NAEP's "Proficient" benchmark closely aligns with college readiness** \- Kentucky data shows NAEP Proficient scores match ACT college readiness benchmarks within 4 percentage points across all student groups, contradicting critics who claim NAEP standards are unrealistically high. - **State assessments inflate student achievement** \- Kentucky's KPREP test reports proficiency rates 15-18 percentage points higher than NAEP for the same students, suggesting state tests provide an overly optimistic picture of student readiness. - **The harsh truth is accurate** \- With only 34% of U.S. public school students scoring Proficient in Grade 4 reading (18% for Black students), NAEP's sobering results reflect genuine preparation gaps for college and career success, not measurement flaws. The report argues that state should replace inflated internal assessments with NAEP-aligned standards that honestly reflect college readiness requirements, providing accurate data for targeted interventions. Federal funding should incentivize adoption of rigorous, externally-validated benchmarks while requiring side-by-side reporting of state and NAEP results with clear explanations of what each measures. This transparency would end the grade inflation that masks achievement gaps and enable evidence-based reforms, particularly for disadvantaged students where readiness deficits are most severe. [Is NAEP's 'Proficient or Above' Achievement Level Valid naepOct22Is NAEP's 'Proficient or Above' Achievement Level Valid naepOct22.pdf10 MBdownload-circle](https://www.bluegrassinstitute.org/content/files/2025/10/Is-NAEP-s--Proficient-or-Above---Achievement-Level-Valid-naepOct22.pdf "Download") ### Best practices for a better Kentucky: More work, less welfare URL: https://www.bluegrassinstitute.org/best-practices-for-a-better-kentucky-more-work-less-welfare/ Last updated: 2025-07-23T14:08:37.000Z *Editor’s note: The Bluegrass Beacon is a weekly syndicated newspaper column posted on the Bluegrass Institute’s website after appearing in publications statewide.* The great irony arising out of Covid’s lingering effect is that businesses struggle to fill positions while many able-bodied adults sit it out, unwilling to forego their government benefits by returning to the workforce. It’s a dilemma Kentucky must solve to take full advantage of opportunities such as the thousands of jobs being created by new electric vehicle battery plants being built in Hardin and Warren counties. Currently, around 180,000 open positions exist in Kentucky; how much sense does it make to continue policies which disincentivize employment? The Foundation for Government Accountability (FGA) reports Kentucky’s Medicaid program has [“exploded in recent years”](https://thefga.org/paper/x-factor-medicaid-enrollment-driving-down-labor-force/?ref=bluegrassinstitute.org) – increasing by over 150%. Meanwhile, the labor force participation rate has dropped by 11%; nearly half of all adults in the commonwealth are now “sitting on the sidelines.” This isn’t what then-Gov. Steve Beshear predicted in 2013 while announcing his unilateral decision to take advantage of the federal Affordable Care Act allowing states to expand Medicaid eligibility to include individuals who could work but don’t. “By expanding Medicaid, [Kentucky will come out ahead](https://www.lanereport.com/21154/2013/05/governor-expands-medicaid-health-coverage-to-be-extended-to-300000-kentuckians/?ref=bluegrassinstitute.org) in terms of both health outcomes and finances,” Beshear promised. Yet there’s little indication that the expansion positively impacted either. The latest America’s Health Rankings rated Kentucky [44th in overall health](https://www.americashealthrankings.org/learn/reports/2020-annual-report?ref=bluegrassinstitute.org) while over 600,000 able-bodied adults have enrolled in the Medicaid expansion—more than triple the number Beshear’s administration predicted. Beshear’s son, current Gov. Andy Beshear, [lashed out](https://apnews.com/article/05574cff163845a3982b1f04735bd41d?ref=bluegrassinstitute.org) during the 2019 gubernatorial campaign at incumbent Gov. Matt Bevin’s proposal to require some able-bodied Medicaid recipients to get a job, enroll in school or volunteer to keep their benefits. The younger Beshear warned that Bevin’s plan would have resulted in thousands of people losing Medicaid coverage. Which is absolutely as it should be. Able-bodied adults who get a job will – and should – come off Medicaid as they gain access to employer-provided health insurance or purchase their own low-to-no-cost plan on the state’s exchange. The elder Beshear’s decision to expand Medicaid not only did nothing to incentivize individuals to transition off the public dole and into private coverage, but it’s also a roadblock to them doing so. After Kentucky expanded Medicaid eligibility, the federal government made a type of private health coverage available on the exchange known as free or low-cost “silver plans” for working people who need a bridge between Medicaid and employer-provided insurance. However, because Kentucky had chosen to expand eligibility for the government-run program, anyone who’s on – or eligible for – Medicaid was banned from accessing these private plans. Despite what opponents of reform claim, there’s no evidence that allowing Medicaid recipients to get a job or earn more will cause them to lose access to health care or coverage. Kentucky offers transitional Medicaid assistance for at least six – and up to 12 – months to families who might otherwise lose their eligibility because of an increase in income. In fact, since the pandemic’s beginning in early 2020, due to federal law, not a single American has been kicked off Medicaid because of their income. “What have the results been?” FGA’s Sam Adolphsen asked while [testifying](https://www.youtube.com/watch?v=AyKfz9IJXFo&t=4071s&ref=bluegrassinstitute.org) at the first meeting of the Kentucky General Assembly’s newly formed Benefits Cliff Task Force in July. “Are people rushing to work like never before, like ‘now I won’t lose my benefits so I can go get that extra job’? Has it solved that problem?” “It hasn’t, of course,” Adolphsen added. “We have more people than ever [sitting on the sidelines](https://www.youtube.com/watch?v=AyKfz9IJXFo&t=4071s&ref=bluegrassinstitute.org) not working, despite over two-and-a-half years of not being able to take someone off Medicaid because of their income. So, the solution isn’t more welfare; it’s more work.” *Jim Waters is president and CEO of the Bluegrass Institute for Public Policy Solutions, Kentucky’s free market think tank. Reach him at* [*jwaters@freedomkentucky.com*](mailto:jwaters@freedomkentucky.com) *and @bipps on Twitter* ### End practice of using sick-day benefit to spike pensions URL: https://www.bluegrassinstitute.org/end-practice-of-using-sick-day-benefit-to-spike-pensions/ Last updated: 2025-07-22T18:25:13.000Z *Editor’s note: The Bluegrass Beacon is a weekly syndicated newspaper column posted on the Bluegrass Institute’s website after appearing in publications statewide.* The premise behind allowing local school districts to reward retiring teachers for unused sick days is understandable. It’s meant to ensure teachers are in their classrooms as much as possible, reducing the interruption for students caused by absences which occur when districts must scramble to find and pay substitute instructors who, in most cases, aren’t able to maintain the same learning pace. However, the way these benefits are determined and then applied [games the system](https://bipps.org/blog/pension-spiking-problems-persist?ref=bluegrassinstitute.org) to the point where the sick-day benefit alone is indefensibly costing Kentucky taxpayers millions of extra dollars annually. It’s reasonable to allow teachers to receive a lump-sum payment at retirement for 30% of the value of the accumulated sick days – up to 10 a year and 300 in a career for most now working in the commonwealth’s public schools. What’s unreasonable is how the law found in [KRS 161.155](https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=51793&ref=bluegrassinstitute.org) artificially inflates these benefits by mandating that “each unused sick leave day shall be based on a percentage of the daily salary rate calculated from the employee’s or teacher’s last annual salary” rather than salaries in the years in which sick days were actually accumulated. New teachers in the Jefferson County Public Schools (JCPS) with a bachelor’s degree earn under $45,000 while certified specialists who’ve been in the classroom for 30 years are paid around $80,000. Since Kentucky teachers have a 187-day contract, the [difference in daily pay](https://www.jefcoed.com/site/handlers/filedownload.ashx?moduleinstanceid=5557&dataid=17232&FileName=2022-2023%20Salary%20Schedule%20-%20Board%20Approved%206.23.22.pdf&ref=bluegrassinstitute.org) is significant – less than $240 per day for a new JCPS teacher versus more than $400 for a colleague who’s taught for three decades. Paying the higher per-day rate to all beneficiaries drastically spikes retirement calculations and costs. But this practice isn’t even the costliest. Where the cost of artificially inflating the per-day determination of sick-day benefits really climbs is through the current practice of adding the amount of that one-time payment to salaries paid retiring teachers in their final year of work. Since the total amount of retired teachers’ pensions are determined by the salaries earned during their last three or five years, dumping sick-leave lump sums into that final years’ salary spikes pensions and socks it to taxpayers in the private sector who, if they receive a sick benefit, certainly can’t use it to bloat their retirement checks. Beau Barnes, executive secretary of the Teachers’ Retirement System (TRS), testified at this month’s Public Pension Oversight Board meeting that the [sick-leave policy costs Kentucky taxpayers $47 million annually](https://www.youtube.com/watch?v=BuVBtLg2FRs&ref=bluegrassinstitute.org). That’s in addition to the $408 million of previous unfunded sick liabilities – a cost that nearly doubles if paid out over the planned 20-year period. Barnes also disclosed that some school districts – [TRS doesn’t know which ones](https://www.youtube.com/watch?v=BuVBtLg2FRs&ref=bluegrassinstitute.org) – allow teachers to convert unused personal days to sick days, further inflating their final salaries, which over-enhances their lifetime retirement pay. Districts are responsible for only the 30% lump-sum payments while the state covers the lifetime cost of such spiking. What incentive, then, do local districts have to ensure sick days aren’t used to draw inflated checks from the retirement system? Legislators are currently addressing some of the commonwealth’s pension crisis by fully funding the retirement systems at a cost to taxpayers of more than $1 billion per year. Still, passage of a new biennial budget during this year’s legislative session reminds us that thorny challenges remain. Even as lawmakers appropriated an additional $479 million to pay down TRS debt, billions in unfunded liabilities loom along with unacceptably low funding levels for the state workers’ and teachers’ pension plans. As we spend more to fill these deep pension holes, let’s ensure personal days aren’t turned into sick days and [end the practice](https://bipps.org/blog/bluegrass-beacon-pension-contract-inviolable-not-inflexible?ref=bluegrassinstitute.org) of allowing retiring teachers to use a one-time, lump-sum sick-day payment to spike their pensions for a lifetime. *Jim Waters is president and CEO of the Bluegrass Institute for Public Policy Solutions, Kentucky’s free market think tank. Reach him at* [*jwaters@freedomkentucky.com*](mailto:jwaters@freedomkentucky.com) *and @bipps on Twitter.* ### What's good for beer should be good for bourbon. Make home distilling legal URL: https://www.bluegrassinstitute.org/whats-good-for-beer-should-be-good-for-bourbon-make-home-distilling-legal/ Last updated: 2025-09-09T17:28:06.000Z When people think ‘bourbon whiskey’ they think of Kentucky. No other part of the country is as closely associated with such a uniquely American drink. That’s something Kentuckians should be proud of, and most of us are. Today, the stories of our state’s [original distillers](https://explorekyhistory.ky.gov/items/show/516?ref=bluegrassinstitute.org#:~:text=Williams%20saw%20opportunity%2C%20and%20in,flatboat%20down%20the%20Ohio%20River.) have become the stuff of Kentucky legend. This makes it all the more ironic that if [Elijah Craig](https://elijahcraig.com/our-history?ref=bluegrassinstitute.org) were to break into the bourbon world today the way that he did in the late 1700’s, he’d likely be breaking the law. Despite its growing popularity, home distilling remains illegal in Kentucky and the United States at large. This prohibition makes little sense, given that it’s perfectly legal to purchase a still along with all the ingredients needed to make bourbon. It’s actually following through to turn those ingredients into alcohol that makes you a criminal. Obviously, the commercial market for distilled spirits is alive and well, and even growing. Recent reforms in liquor regulations have ensured that smaller entrepreneurs can create their favorite drinks and compete with the larger players in the industry. In 2021, for example, the Craft Beverage Modernization and Tax Reform Act was made permanent, ensuring that those in the craft beverage industry would maintain a tax relief originally made in 2017\. This prevented a nearly 400% tax rate increase — an increase that would have almost certainly put the final nail in the coffin for many businesses. Reforms like these have gone a long way in helping craft distilleries flourish in the marketplace and play a crucial role as a disruptive force in the commercial industry. As of August 2019, for instance, craft spirits producers increased by 11.5% over a year. Every year, more independent craft distillers break into the industry with growing rates of success. Yet personal distilleries are still totally illegal. Enthusiasts who want to try their hand at crafting their own bourbon, even if it’s purely for personal consumption, are out of luck. Making bourbon without a license is a criminal offense. The prohibition on home distilling creates an artificial barrier to entry to budding entrepreneurs who want to perfect their distilling skills at home. It also turns everyday citizens into felons simply for engaging in an activity that is lawful for industry titans, but not for them. Fortunately, the craft beer industry provides a policy template that home distillers ought to be allowed to use moving forward. After prohibition ended in 1933, home brewing, much like home distilling, remained illegal. Only those permitted to operate could make and sell beer. This was the case until October 14, 1978, when President Jimmy Carter signed a bill legalizing the practice of home brewing. Many breweries that are now established institutions got their start in basements or garages, experimenting with unique techniques and flavors, thanks to the legalization of homebrewing. The craft spirits industry could find itself in a similar situation if proper reforms were made. Obviously, there is only so much that Kentucky can do until federal law is changed, but that doesn’t mean it should stick to the status quo. As many as eight states currently have adopted laws that would legalize the practice the moment the federal ban was lifted. Kentucky isn’t one of them. If the federal government finally decides to allow enthusiasts to distill their own spirits for personal consumption, the practice would still be criminalized in the land of bourbon itself. That shouldn’t sit well with any proud Kentuckian. Home distillers should not be criminalized and driven underground to engage in an activity that is commercially permissible. Kentucky bourbon is a staple of the commonwealth. Enthusiasts who want to engage in the activity should be permitted and encouraged to do so. Kentucky should take the appropriate steps to ensure that the creation of bourbon is accessible to anyone eager to participate. *This op-ed was first published in the Louisville Courier-Journal on August 29, 2022.* ### Pension spiking problems persist URL: https://www.bluegrassinstitute.org/pension-spiking-problems-persist/ Last updated: 2025-07-23T14:10:52.000Z Pension spiking provisions and sick leave policy costs to Kentucky taxpayers have been major topics for the Public Pension Oversight Board (PPOB) during this interim session. Currently, members of the Teachers' Retirement System (TRS) can accumulate unused sick days for a lump sum payout at their time of retirement. Though the payout is 30% of their daily pay rate, the sum is calculated using their final salary, not the salary earned when the sick day was accumulated, artificially inflating the payout. However, the major cost to taxpayers is the practice of adding that lump sum payout to the teacher’s final salary. A teacher’s overall post-retirement pension payments are determined by their salary the final three or five years (depending on the beneficiary’s pension tier) of employment. Thus, adding that sick leave lump sum to the final salary once again artificially inflates the cost to taxpayers for the rest of that educator’s lifetime - a practice known as “pension spiking.” At Monday’s [PPOB meeting](https://www.ket.org/legislature/archives/?nola=WLEGP+022047&stream=aHR0cHM6Ly81ODc4ZmQxZWQ1NDIyLnN0cmVhbWxvY2submV0L3dvcmRwcmVzcy9fZGVmaW5zdF8vbXA0OndsZWdwL3dsZWdwXzAyMjA0Ny5tcDQvcGxheWxpc3QubTN1OA==&ref=bluegrassinstitute.org), Beau Barnes, TRS Deputy Executive Secretary, indicated that some school districts are allowing teachers to convert unused personal days to sick days to further inflate their final salaries and therefore over-enhance their lifetime pensions. That cost to the state is unknown as TRS does not have data on which school districts are allowing that practice. Sick leave pension spiking was addressed in a [BIPPS-backed plan](https://bipps.org/blog/2021-legislative-wrap-up?ref=bluegrassinstitute.org) passed by lawmakers in the 2021 legislative session. However, it only fixes the issue for TRS members hired after January of this year. The issue of pension spiking for educators hired previously to 2022 continues. According to Barnes, the cost to taxpayers if lawmakers don’t fix this sick leave policy is about $47 million per year. Currently, the state owes $408 million in unfunded sick leave costs. However, if paid out over the planned 20-year period, the cost to taxpayers nearly doubles. For the past several years, legislators have taken a serious approach to addressing the commonwealth’s pension crisis by fully funding the state’s pension systems - a cost of over [$1 billion](https://www.greaterlouisville.com/advocacy-and-legislation/general-assembly-passes-biennial-state-budget/?ref=bluegrassinstitute.org) per year to taxpayers. On top of that, lawmakers appropriated an extra [$479 million](https://kypolicy.org/budget-agreement-includes-only-modest-increases-in-most-areas-of-budget-salary-increases-for-state-workers/?ref=bluegrassinstitute.org) in the most recent biennial budget to pay down TRS debt. But if they are serious about addressing all the issues contributing to this high cost to taxpayers, they will take a hard look at sick leave reform for current employees. The current sick leave policy is not in the inviolable contract and would only take a simple statutory change to save taxpayers hundreds of millions of dollars. ### Renters are the biggest losers in Louisville’s new registration law URL: https://www.bluegrassinstitute.org/renters-are-the-biggest-losers-in-louisvilles-new-registration-law/ Last updated: 2025-10-06T17:49:22.000Z My home state of Kentucky is known primarily for bourbon, horse races and ranking at or near the bottom of things like [education](https://www.alecreportcard.org/state/?ref=bluegrassinstitute.org), [women’s health](https://wallethub.com/edu/best-and-worst-states-for-women/10728?ref=bluegrassinstitute.org) and [poverty](https://www.americanprogress.org/data-view/poverty-data/poverty-data-map-tool/?ref=bluegrassinstitute.org). But none of this is surprising considering Kentucky lawmakers’ unending commitment to patently backward policies. Take the city of Louisville’s new [rental registry.](https://louisvilleky.gov/government/codes-regulations/rental-registry-faq?ref=bluegrassinstitute.org) Coming on the heels of a [Metro Council](https://urldefense.com/v3/%5F%5Fhttps:/louisville.granicus.com/DocumentViewer.php?file=louisville%5Fdd1473396b0dc74908b546935f6cd830.pdf&view=1%5F%5F;!!L56lHL45yBnxmH0BBg!7%5F5VE4%5F5q9qYqcPv%5FuFHkqPbCkQjosbMkH1JuWt5zQq6w2QxDAoDyhWO1EhuvXqK5unbX8dDBJ96PFZrJpjUpog%24&ref=bluegrassinstitute.org) ordinance passed in December 2022, the city requires owners of rental properties to register their properties, pay a registration fee and agree to have them [regularly inspected](https://www.whas11.com/video/news/local/louisville-mayor-debuts-rental-registry-program/417-74a09996-68a3-45b7-841e-b3501abf040e?ref=bluegrassinstitute.org). Properties will also be randomly inspected — though government-owned properties are conveniently exempt. In announcing the registry, Louisville Mayor [Craig Greenberg](https://www.wlky.com/article/louisville-mayor-new-registry-rental-property-owners/60570695?ref=bluegrassinstitute.org) stated that the registry would help identify problem properties early and provide a way for tenants to report problems without worrying about negative reactions from their landlords. While this all sounds good, a cursory understanding of economics (or a small amount of common sense) should give anyone pause. If this policy is intended to help renters, policymakers and those seeking housing in Louisville in the coming months and years are likely in for some unpleasant surprises. First, renters will find there is less housing. To understand why, consider first the landlord’s perspective. More than [40 percent of all rental properties](https://finance.yahoo.com/news/biden-one-size-fits-plan-150000623.html?guccounter=1&guce%5Freferrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&guce%5Freferrer%5Fsig=AQAAAKi6DGhXHDPU8E93iS%5Fcu4rJihJ8Sf0k8%5FUnWVuMJJtc71MaNtCM-NisIftNVHXUnhCOH8kqYYlTNdVycH5yZxEAMIcs6-eFh-lkvwro%5FdIocgMWN36dBCOdevdVi-JRL3XDy7rUx2FvgA5rCYoe97cx75gH-pI2AD-35f1LVyLp&ref=bluegrassinstitute.org) in the U.S. are owned by individuals or “mom-and-pop” landlords. These small-scale landlords manage a whopping [77 percent of two-to-four-unit properties](https://www.nar.realtor/blogs/economists-outlook/landlord-statistics-from-the-2018-rental-housing-finance-survey?ref=bluegrassinstitute.org). They are not remarkably wealthy. The average income for a landlord in Kentucky is just over [$50,000 a year](https://www.salary.com/research/salary/hiring/landlord-salary/louisville-ky?ref=bluegrassinstitute.org). Nationally, the average is just over [$69,000](https://ipropertymanagement.com/research/landlord-statistics?ref=bluegrassinstitute.org). Faced with registration fees, having their names, addresses, telephone numbers, and email addresses listed online and random searches — for which landlords are responsible for notifying tenants — many mom-and-pop landlords will simply choose not to rent their properties. Moreover, considering that much of Louisville’s rental housing was built between 1940 and 1960, many of these properties won’t be compliant with modern building codes. This means they’ll face numerous potential citations. All of this makes the prospect of renting out one’s property even less appealing. How about real estate developers and larger-scale landlords? Faced with similar prospects but on a larger scale, high vacancy rates, [crime rates](https://www.whas11.com/article/news/crime/louisville-homicide-numbers-kentucky-crime/417-75291740-5af6-4c23-8065-f7479a0948c7?ref=bluegrassinstitute.org) and an otherwise unattractive market, they will take their business elsewhere. Second, those that do find rentals are likely to see higher rents. There are several reasons why. As the number of rental units falls, competition among would-be tenants naturally pushes prices higher. But there is another reason: elasticity. Elasticity is how economists describe how sensitive or insensitive a group is to a price change. When consumers have a lot of alternatives, we categorize them as “elastic,” or price-sensitive. If the price of a good or service rises, they can avoid those higher prices by choosing an alternative. If, on the other hand, they have few options, or it’s difficult to change their behavior in response to a price change, we categorize them as “inelastic,” or price-insensitive. Economics teaches us that when a tax or similar policy is imposed in a market, the inelastic group incurs the greater cost of the policy — the side with fewer options is on the hook. Care to guess who has fewer options in the market for rental housing? That’s right, renters, and especially poor renters. In Louisville, the new policy is aimed at areas with the highest rental rates and the [most poverty](https://www.lpm.org/news/2024-04-22/louisville-to-start-proactive-inspections-of-rental-properties-june-1?ref=bluegrassinstitute.org). Higher rents and fewer units will place an even heavier burden on the city’s worst-off residents. That is to say nothing about how this new policy strips (mostly) low-income residents of their right to privacy, because of their neighborhoods and their status as renters. That may even be [unconstitutional](https://ohioconstitution.org/federal-court-cities-rental-licensing-and-inspection-requirements-unconstitutional/?ref=bluegrassinstitute.org). It also fails to consider how unexpected or unwanted visits by city officials could be dangerous for them and for tenants. No one wants renters to be in dangerous or unsafe housing. But this policy is misguided on many counts. It will harm the very people it is intended to protect. It will increase rents, reduce housing and violate privacy. If policymakers were serious about improving housing in Louisville and elsewhere, they’d remove the barriers that prevent the creation of housing, not introduce additional impediments. *Abigail R. Hall is a senior fellow at the Independent Institute in Oakland, Calif., and an associate professor in economics at the University of Tampa*. ### Bolstered reserves, lower tax burden increase Kentucky’s competitiveness URL: https://www.bluegrassinstitute.org/bolstered-reserves-lower-tax-burden-increase-kentuckys-competitiveness/ Last updated: 2025-08-10T19:50:37.000Z ***Editor’s Note: The Bluegrass Beacon is a weekly syndicated newspaper column posted on the Bluegrass Institute’s website after being published by newspapers statewide.*** Lawmakers made solid progress in improving Kentucky’s economic competitiveness during the final days of this year’s General Assembly session before adjourning for a two-week veto period. For one, they held firm against calls to lighten the commonwealth’s Budget Reserve Trust Fund by spending excessively on new government programs. Instead, they put a record $1.75 billion into the fund to offset the impacts of future revenue declines and provide stability through the ups and downs of the economy and during future emergencies. This amounts to more than 40 days of expenses – a vast improvement over the situation in the early days of COVID-19 just a couple of years ago when the state had only about four days’ worth of reserves. It’s [wiser stewardship of these momentary dollars](https://bipps.org/blog/rainy-day-fund-consensus?ref=bluegrassinstitute.org) than using them to create new programs or expand existing ones, which would likely result in major tax increases or painful cuts in future years when surpluses and one-time pandemic relief funds aren’t available. Credit Rep. Jason Petrie, R-Elkton, and Sen. Chris McDaniel, R-Ryland Heights, for providing the leadership in their respective chambers to produce one of the more responsible budgets in modern history. It’s not perfect, though. Legislators just couldn’t help themselves when it came to continuing to fund Kentucky Wired – [the state’s broadband boondoggle](https://bipps.org/blog/conference-committee-kentucky-wired?ref=bluegrassinstitute.org) – and to allowing state police to use a sick day benefit to spike their pensions. Plus, there’s still concern about some hike in the state’s gas tax. However, those on the left side of Frankfort’s political aisle should remember that it’s the consistent conservatism over the past few years which has helped improve our fiscal picture, allowing Kentucky to move beyond budget discussions dominated by struggles to fund pension and Medicaid obligations. This year, legislators passed a two-year, $32 billion budget that includes raises for state workers and troopers and provides record funding to school districts, allowing them to bump up teachers’ salaries and spend on other needs they deem appropriate. This approach aligns with [Petrie’s repeatedly made point](https://bipps.org/blog/budget-belies-big-spenders-misleading-claims-provides-funding-for-teacher-raises-1?ref=bluegrassinstitute.org) that school districts, not state government, employ teachers and therefore should handle raises instead of having to cope with another one-size-fits-all mandate from Frankfort. Lawmakers also built a [path](https://bipps.org/blog/flat-rates-work-for-tithes-taxes?ref=bluegrassinstitute.org) toward [reducing and finally eliminating the state’s personal income tax](https://apps.legislature.ky.gov/record/22rs/hb8.html?ref=bluegrassinstitute.org) and, most importantly, lowering taxpayers’ overall burden. A new Wallet Hub comparison of individuals’ tax burdens among the 50 states adds to the growing mountain of data showing that states relying more on consumption – or sales – taxes are more economically robust than those like Kentucky with its current reliance on taxing income, which punishes and thus discourages productivity. The comparison claims Kentucky has the nation’s [10th-highest individual income tax burden](https://wallethub.com/edu/states-with-highest-lowest-tax-burden/20494?ref=bluegrassinstitute.org) when considering “the proportion of total personal income that residents pay toward state and local taxes.” According to the survey, Kentucky has a higher personal income tax burden than any of our neighboring states – including even Virginia with its District of Columbia metro area – and surpasses individual loads in others like North Carolina and Alabama we compete with for economic growth and development. The survey also reminds: not all types of taxes carry an equal burden. While Tennesseans pay a higher proportion of their incomes in sales and excise taxes than Kentuckians, the Volunteer State’s overall tax burden is No. 49 – second-lightest in the nation. A lower income tax even with higher consumption taxes is a much more pro-growth combination and results in considerably lower overall burdens on taxpayers than a heavier reliance on personal income taxes. The tax reform policy offered by Kentucky’s lawmakers balances the urgency of ceasing to punish productivity and discourage growth with the need to ensure adequate funds are available to properly support state government and keep that rainy day fund strong. *Jim Waters is president and CEO of the Bluegrass Institute for Public Policy Solutions, Kentucky’s free market think tank. Reach him at* [*jwaters@freedomkentucky.com*](mailto:jwaters@freedomkentucky.com) *and @bipps on Twitter.* ### One lesson from Kentucky's devastating tornadoes: Build a strong Rainy Day Fund URL: https://www.bluegrassinstitute.org/one-lesson-from-kentuckys-devastating-tornadoes-build-a-strong-rainy-day-fund/ Last updated: 2025-10-05T23:02:13.000Z *By Andrew McNeill and Angela Oh* The tragic loss of life and property destruction from December’s devastating tornadoes in western Kentucky are still fresh in the memories of Kentuckians. In the immediate aftermath, federal and state emergency management agencies stepped in to assess the damage and provide resources needed for initial relief. But rebuilding these shattered communities will be long and hard for those who lost everything. Last year, the General Assembly and Gov. Andy Beshear prioritized deposits to the state’s rainy day fund. Thanks to this bipartisan effort, for the first time in a generation Kentucky has significant savings it can tap to support the communities that bore the brunt of the tornadoes; in fact, the General Assembly [has already appropriated](https://apps.legislature.ky.gov/record/22rs/hb5.html?ref=bluegrassinstitute.org) $200 million in relief funds. As policymakers continue with the 2022 session, they should consider how to implement policies that will ensure that the state’s $1.5 billion rainy day fund continues to serve the best interests of the commonwealth’s citizens. The primary purpose of a rainy day fund is to offset the impact of revenue declines and stabilize a state’s fiscal position through economic ups and downs, natural disasters and declared states of emergency. Research from The Pew Charitable Trusts suggests that rainy day funds [should be targeted](https://www.pewtrusts.org/en/research-and-analysis/reports/2018/06/14/state-strategies-for-maintaining-a-balanced-budget?ref=bluegrassinstitute.org) to one-time costs - not ongoing state expenses - to help keep budgets balanced over time. The details of how rainy day funds are set up and managed make all the difference, and Kentucky should consider implementing the best practices outlined below. In states where policies governing rainy day funds are clear and consistently practiced, the funds can mitigate the impact of economic downturns. **Deposit extraordinary revenue into the rainy day fund:** States should establish deposit rules that encourage a steady accumulation of reserves during periods of economic and revenue growth by tying deposits into the rainy day fund to above-normal revenue growth or one-time increases of revenue. Such rules require policymakers to determine what constitutes “above-normal” and “one-time collections.” Tennessee, for example, puts 10% of year-over-year additional revenue into its reserve fund, allowing lawmakers to set aside funds that are more than what’s needed or anticipated while ensuring the state has enough money to maintain ongoing services. **Define clear withdrawal conditions:** To ensure that rainy day funds are used as intended, policymakers should establish clear withdrawal rules. Such a law can help lawmakers decide in advance when and how to use reserves, and which situations would trigger a withdrawal. **Calculate a risk-based savings target:** Policymakers should tailor reserve caps and targets to their state’s fiscal situation. A state that experiences greater economic and revenue volatility than other states should aim for larger reserves than a state with a comparatively stable tax base.Regular volatility studies can provide insight on how frequent and deep a state’s revenue shortfalls have been. Budget stress tests can also provide insights on how a state’s existing budget reserve balance would fare against economic shocks. A case in point is North Carolina. Pew worked closely with the state in 2017 to enact comprehensive savings reform, and North Carolina now sets its Savings Reserve Account target based on an analysis of its historic revenue volatility. The last two years proved that states need robust reserves to deal with emergencies. And the resources needed to handle those emergencies must be adequately funded. By establishing clear rainy day fund policies that guide deposits, withdrawals and savings targets, states can ensure that reserves are regularly collected, properly used, and well managed. *Andrew McNeill is a visiting policy fellow at the Bluegrass Institute. Angela Oh is a senior manager with The Pew Charitable Trusts’* [*state fiscal health initiative*](https://www.pewtrusts.org/en/projects/states-fiscal-health?ref=bluegrassinstitute.org)*.* *This op-ed was first* [*published* ](https://www.kentucky.com/opinion/op-ed/article258271458.html?ref=bluegrassinstitute.org)*by the Lexington Herald-Leader.* ### Lawsuit uses tax dollars to sue taxpayers URL: https://www.bluegrassinstitute.org/lawsuit-uses-tax-dollars-to-sue-taxpayers/ Last updated: 2025-09-10T12:37:10.000Z The Council for Better Education (CBE) is [using your tax dollars to sue](https://bipps.org/blog/attorney-legal-challenge-to-school-choice-policy-a-delay-tactic?ref=bluegrassinstitute.org) … you, the Kentucky taxpayers! The CBE group, comprised of administrators from most of Kentucky’s public school districts, has filed a lawsuit in Franklin Circuit Court claiming the portion of [House Bill 563](https://apps.legislature.ky.gov/record/21rs/hb563.html?ref=bluegrassinstitute.org) allowing students in a handful of Kentucky counties to use funds from [education opportunity accounts](https://bipps.org/blog/if-were-talking-about-impacts-of-school-choice-lets-look-at-real-examples-not-guesses?ref=bluegrassinstitute.org) to cover tuition and expenses at private schools “redirects state revenues” in a manner that’s unconstitutional. Such a claim is mysterious at the outset, considering the funds in question never touch government’s sticky fingers. These accounts will get their money from voluntary contributions by Kentucky individuals and businesses to nonprofit accounting granting organizations which will then be responsible for distributing funds to qualifying students. The council’s lawsuit attempts to cloud the scholarship situation by renaming them “vouchers,” which would indicate they are public education funds given directly to private schools. But the U.S. Supreme Court has already ruled in similar cases involving other states that dissemination of voluntarily contributed funds in this manner is solidly constitutional and doesn’t support the CBE’s allegation that such a policy involves direct payments of tax dollars to private schools. Neither should Kentucky families be denied because such opportunity is funded by a policy offering incentives to contributors in the form of a credit against their state tax liability. “State and federal governments do all sorts of things to incentivize good behaviors, and among those good behaviors are spending private money in ways that have a good social benefit,” said Bluegrass Institute Scholar Gary Houchens, Ph.D., a former Kentucky Board of Education member and professor of education administration at Western Kentucky University. “Providing more educational opportunities for students who otherwise don’t have them is positive for the entire community as well as for those families.” Yet, as Houchens adds, “at the end of the day, it’s a private transaction” and like any good professor should, encourages Kentuckians to “follow the logic” implicit in the council’s allegation that somehow or other, these donations to nonprofit granting organizations are public dollars being redirected away from public schools. “Based on that argument, every tax credit and every tax deduction is also a diversion of money that otherwise belongs to the state, and if you take that to its logical conclusion, the message there is that every dollar you earn actually belongs to the government unless it deems to give you a little part of it back,” Houchens surmised. “That’s not the message that most Kentuckians and most Americans would agree with.” Objective analysis of this lawsuit and the developments surrounding it would also cause “most Kentuckians and most Americans” to question its intent. If this really is a claim about tax credits thieving money away from Kentucky’s public schools, then why is this council suing over the measly $25 million worth of tax credits in the school choice bill while totally ignoring the much-larger current $75 million in tax incentives for film and television production in Kentucky and $100 million worth of tax breaks on construction projects at historic properties? Even more perspective is gained on this miniscule $25 million tax-credit program considering the Warren County Public Schools – one of two districts filing as a plaintiff, allowing the council’s lawsuit to proceed – alone will receive $36 million worth of COVID relief funds. “And so, they’re going to be awash in this tax money, and yet they’re spending Warren County taxpayer dollars to try to stop students from having these other educational options that really will have minimal impact on the district and its budget but will greatly help some families who need different educational opportunities for their children,” Houchens said. ### Report: Economic freedom best path to make Kentucky competitive again URL: https://www.bluegrassinstitute.org/report-economic-freedom-best-path-to-make-kentucky-competitive-again/ Last updated: 2025-10-05T23:46:38.000Z FRANKFORT, Ky. – A report released today by the Bluegrass Institute for Public Policy Solutions looks back over the past 40 years to demonstrate how Kentucky has fallen short in creating the robust economic growth generated by competitor states and provides several recommendations to place the commonwealth on a path towards a whole new level of opportunity for Kentuckians. [The Lost Decades: Kentucky's Economic Underperformance 1980 - 2020Kentucky has fallen short in creating the robust economic growth generated by competitor statesLostDecades.pdf3 MBdownload-circle](https://www.bluegrassinstitute.org/content/files/2025/09/LostDecades.pdf "Download") "The Lost Decades: Kentucky's Economic Underperformance 1980 - 2020" by Visiting Policy Fellow Andrew McNeill contrasts the Bluegrass State’s sluggish progress in creating higher standards of living with four benchmark states - Alabama, Indiana, Tennessee and North Carolina – and provides overwhelming evidence that Frankfort's practice of favoring progressive redistribution over economic freedom has held the state back for generations and continues to do so. "The question of why Kentucky couldn’t keep pace with its competitors is complex," McNeill said. "However, a critical distinction can be drawn between Kentucky and these other states. Their embrace of limited government and fiscal responsibility has created greater wealth and opportunity for their residents. Kentucky remains a laggard, as this report shows." While Frankfort has sold the notion that “Kentucky continues to move forward,” the fact is Kentucky's per capita income has fallen from 86.2% of the U.S. average in 1999 to 72.9% in 2019\. The state’s economy grew over the period but not nearly fast enough to keep pace with the rest of the United States. The analysis also uncovers a fact likely to surprise many: Forty years ago, Kentucky was essentially as wealthy as North Carolina and Tennessee – states which receive high marks in various economic-freedom rankings – while the Bluegrass State now shares the space reserved for larger "blue states" like Illinois, New Jersey and Connecticut. [The Lost Decades: Kentucky's Economic Underperformance 1980 - 2020Kentucky has fallen short in creating the robust economic growth generated by competitor statesLostDecades.pdf3 MBdownload-circle](https://www.bluegrassinstitute.org/content/files/2025/09/LostDecades.pdf "Download") The report’s central premise regarding Kentucky's sluggish growth is less about partisan labels than it is about whether policy favors economic freedom or progressive redistribution. Evaluating Kentucky's historic and current fiscal policies reveals a clear preference for higher government spending, irresponsible debt and a tax burden borne by Kentuckians more closely aligned with New York than a competitor like Tennessee. Kentucky redistributes a higher percentage of its residents’ income through state government spending than any of the four benchmark states. Especially troubling is the fact that constituencies favoring higher taxes and redistribution continue to prevail in Frankfort. “Four decades of stagnation offer sufficient evidence that policies centered on government growth and the redistribution of hardworking taxpayers’ dollars hinder the ability of Kentuckians to flourish and enjoy the economic blessings of liberty,” Bluegrass Institute President and CEO Jim Waters said. “This report offers a framework of realistic recommendations to assist conscientious policymakers and their constituents in making the case for policies favoring less government and more economic freedom which will help Kentucky catch up and compete once again.” The report offers 11 recommendations to rein in state spending and debt, support pro-growth tax policy and require a new level of transparency and program review for state-funded programs. Recommended structural reforms include placing a Taxpayers Protection Act constitutional amendment in front of voters for ratification, strengthening Kentucky's Rainy Day Fund and requiring all revenue and spending measures be posted for 72 hours before a vote by the General Assembly. [The Lost Decades: Kentucky's Economic Underperformance 1980 - 2020Kentucky has fallen short in creating the robust economic growth generated by competitor statesLostDecades.pdf3 MBdownload-circle](https://www.bluegrassinstitute.org/content/files/2025/09/LostDecades.pdf "Download") ### Miscalculating Accountability URL: https://www.bluegrassinstitute.org/miscalculating-accountability/ Last updated: 2026-03-23T18:41:00.000Z [Miscalculating AccountabilityKentucky's School Financial Reports Just Don't Add UpKentucky’s+School+Financial+Reports+Just+Don’t+Add+Up.pdf9 MBdownload-circle](https://www.bluegrassinstitute.org/content/files/2026/03/Kentucky---s-School-Financial-Reports-Just-Don---t-Add-Up.pdf "Download") The Bluegrass Institute has identified serious credibility problems in Kentucky's school-level financial data as reported in the Kentucky Department of Education's school report cards, stemming from requirements first imposed by the federal Every Student Succeeds Act of 2015\. A basic analysis of the data reveals obviously non-credible figures, including a reported per-pupil spending amount of $1,304,139 for Paris Middle School — the result of an input error that went undetected and uncorrected for months. More broadly, the Bluegrass Institute found widespread internal inconsistencies across hundreds of schools where sub-totals fail to reconcile with reported totals, personnel spending figures are implausibly high or impossibly low, and the underlying MUNIS accounting system has documented data integrity problems dating back to at least 2006 — problems that have never been fully resolved. **Main Takeaways** - There are 71 schools where the sum of individual spending components exceeds the reported total by at least $1,000 per pupil, and Paris Middle School shows a disparity of $1,291,277 per pupil in the opposite direction — discrepancies no reputable accountant would accept. - The underlying MUNIS financial accounting system, used by all Kentucky school districts, has long-documented data integrity problems; a 2006 Legislative Research Commission report found the data quality insufficient for meaningful efficiency analysis, and those problems persist today. - The KDE has no way to confirm the accuracy of the school-level data being loaded into the report-card database by local school districts, meaning errors — even obvious, massive ones — may go undetected indefinitely without external scrutiny. Some of the data is unquestionably in error, and the enormous mistakes for Paris Middle School and some Hardin County schools are issues that anyone spending any time with this data should have noticed — yet they were not identified until the Bluegrass Institute examined the data, and the erroneous figures remained online months after being flagged. The report calls on KDE to run basic reasonableness checks before publishing school-level data, develop a formal review process for whoever computes and posts the figures, and provide more spending detail than the current spreadsheet offers. Since the Kentucky Board of Education has displayed a general disinterest in this work, the report recommends that legislators consider creating an independent civilian finance committee — including finance experts, educators, business representatives, researchers, and possibly the state auditor's office — to oversee the development and reporting of accurate, actionable education finance data. [Miscalculating AccountabilityKentucky's School Financial Reports Just Don't Add UpKentucky’s+School+Financial+Reports+Just+Don’t+Add+Up.pdf9 MBdownload-circle](https://www.bluegrassinstitute.org/content/files/2026/03/Kentucky---s-School-Financial-Reports-Just-Don---t-Add-Up.pdf "Download") ### Ousted KBE members take stand; hospital ruse offers ‘myopic malarkey’ URL: https://www.bluegrassinstitute.org/ousted-kbe-members-take-stand-hospital-ruse-offers-myopic-malarkey/ Last updated: 2025-10-16T22:36:29.000Z This General Assembly edition of Liberty Boosters and Busters begins with Kentuckians who, while neither bureaucrats nor politicians, care enough about the future of our commonwealth to take a principled stand against an unfair and destructive policy. **Liberty Boosters:** Most of the former Kentucky Board of Education (KBE) members are [teaming up](http://www.bipps.org/media-alert-ousted-kentucky-board-of-education-members-partner-with-the-bluegrass-institute-in-lawsuit-against-gov-beshear/?ref=bluegrassinstitute.org) with the Bluegrass Institute, my organization, in a [federal court challenge](http://www.bipps.org/wp-content/uploads/BIPPS-BOE-Federal-Complaint.pdf?ref=bluegrassinstitute.org) to newly minted Gov. Andy Beshear’s executive order removing them from the body without due process and before their terms expire. Apologists for Beshear wrongly claim the governor’s actions mirror those of his predecessor, former Gov. Matt Bevin, who ended up appointing the entire board. Bevin, unlike Beshear, didn’t throw out the largely do-nothing KBE members before their terms expired. Instead, he followed the law, which clearly states KBE members cannot be removed except “for cause.” Bevin waited until board members’ terms expired before replacing them with successful business and educational leaders willing to challenge Kentucky’s public-education system status quo of bloated budgets, even-larger achievement gaps and hostility toward parental school choice. Yet such an approach wasn’t Bevin’s initial tactic. When the former governor four years ago floated the idea of stacking the KBE with additional members, legislative leaders warned him that the General Assembly would exercise its statutory right to reverse his action and return the board to its previous makeup. Consistency demands the current legislature with many of those same leaders still in power [who denied Bevin also oppose Beshear’s shenanigans](http://www.bipps.org/media-alert-bluegrass-institute-supports-ousted-board-of-education-members-call-for-legislative-reform-of-governors-power/?ref=bluegrassinstitute.org), driven largely by his ideological opposition to school choice and political debt to the state teachers’ unions, who spurred his successful gubernatorial campaign. But ousted board member Gary Houchens, who trains future school principals at Western Kentucky University, cautioned: “The state’s education system is too important to be treated like a political football every time there is a change of administration.” Houchens also noted that KBE members who oversee Kentucky’s public schools should at least be afforded “the same protections as our teaching peers” who cannot be removed from the classroom without cause or due process. **Liberty Busters:** The majority of House Appropriations and Revenue Committee members who recently [voted](https://apps.legislature.ky.gov/record/20rs/house%5Fvotes/11%5Fcomm%5Fvotes.pdf?ref=bluegrassinstitute.org) to [fork over millions](https://apps.legislature.ky.gov/record/20rs/hb99.html?ref=bluegrassinstitute.org) of taxpayer dollars in the form of a “partially forgivable” loan to the University of Louisville to purchase Jewish Hospital, which has financially hemorrhaged for years. Marion Republican Rep. Lynn Bechler is himself a Liberty Booster for being the only committee member to vote “no.” Rep. Danny Bentley voted “pass,” whatever that means. University of Louisville President Neeli Bedapudi in her arrogant disregard for the kind of unsound policy involving government picking winners and losers by funding her hospital even as many rural facilities are on financial life support, wants Mr., Mrs. and Miss Taxpayer to shiver with positivity because she’s [reduced her request](https://wfpl.org/lawmakers-advance-bill-funding-u-of-ls-jewish-hospital-purchase/?ref=bluegrassinstitute.org) from the original $50 million to only $35 million. Isn’t that special? I wonder how those 1,000 employees at Ashland’s Our Lady of Bellefonte Hospital in Bentley’s district feel about the use of their hard-earned dollars to bail out a failing facility three hours and 190 miles away when they discovered the day prior to the committee vote that they will lose their own jobs when the hospital closes later this year? Bentley’s asking Beshear for help as will legislators statewide representing many districts with financially struggling hospitals if Frankfort starts bailing out medical facilities. Policymakers shouldn’t be misled by Bendapudi’s illusory and myopic malarkey about how Kentucky will suffer great damage to its research and transplant capabilities should Jewish Hospital close its doors. People in Bowling Green go to Nashville and plenty of patients in the central part of the commonwealth find their way to highly advanced University of Kentucky health care facilities. Meanwhile, many of those liberty-busting politicians endorsing Bendapudi’s costly hospital ruse are, at the same time, bemoaning - at high volume - Kentucky’s budget woes. Enough said. *Jim Waters is president and CEO of the Bluegrass Institute for Public Policy Solutions, Kentucky’s free-market think tank.* ### Scholarship program offers the right kind of tax credit URL: https://www.bluegrassinstitute.org/scholarship-program-offers-the-right-kind-of-tax-credit/ Last updated: 2025-10-16T22:24:47.000Z Isn’t it an interesting phenomenon how leftwing political degenerates care little about spending until the proposed program offers a piece that doesn’t fit their philosophical puzzle? Take the huffing and puffing by opponents of encouraging individuals and businesses to donate to a modest program that would [turn those dollars into scholarships](https://apps.legislature.ky.gov/record/20rs/HB350.html?ref=bluegrassinstitute.org) for Kentucky parents who want to provide their children with a private education but are unable to afford tuition payments without assistance. Suddenly, these antagonists are concerned about [the program’s](https://apps.legislature.ky.gov/record/20rs/SB110.html?ref=bluegrassinstitute.org) cost, which would be a modest $25 million as contributors would receive a credit against their state tax liability. Leftist political advocacy groups like the misleadingly named Kentucky Center for Economic Policy, which incessantly lobbies for swelling the size and scope of government – and for the accompanying tax hikes required to fund its bloated proposals – are sending up smoke signals about how school-choice programs will decimate public education funding. The group [blathered](https://kypolicy.org/private-school-tax-credit-math-does-not-add-up/?ref=bluegrassinstitute.org) in a blog post during last year’s legislative debate over scholarship tax credits about how only kids already in private schools would be the primary beneficiaries and, as a result, “we’ll have substantially less, rather than more, revenue available for our public schools.” Nowhere, no how and in no way does the group ever offer even the smallest dose of honest analysis by acknowledging that the proverbial education sky hasn’t fallen in the 18 states already offering 23 such scholarship tax credit programs. Well-known researcher Dr. Martin Lueken with the Thomas B. Fordham Institute and EdChoice analyzed 10 of those tax credit programs in seven of the states representing 90% of all such scholarships in the nation and found they produce [huge long-term savings](https://www.edchoice.org/wp-content/uploads/2017/03/Tax-Credit-Scholarship-Audit-by-Martin-F.-Lueken-UPDATED.pdf?ref=bluegrassinstitute.org) for schools and education systems. Lueken reports that states after a couple of years of revenue loss see millions – even hundreds of millions – worth of long-term savings since the cost of educating children in private schools tends to be lower than what public schools spend. When a child leaves a public school to enroll in private or parochial school, Lueken concludes it saves the public school he left a significant amount of funding. Not only does the school the student leaves no longer have the cost of educating him, but it continues receiving the property tax dollars his parents must still fork over even though they’re not utilizing the public education system. A mother of three in Louisville explained she can send her young children to a private Catholic elementary school for a total of $14,000. At the same time, the Jefferson County Public Schools spent [in excess of $2,000 more](https://www.jefferson.kyschools.us/sites/default/files/jcpsdbk24.pdf?ref=bluegrassinstitute.org) per individual student than it costs her to educate all three of her children at a private parochial school. A donor who contributes, say, $14,000 to the proposed scholarship program receives a 95% tax credit, meaning the state “loses” $13,300. But does it really lose? Schools no longer have to cough up the $48,132 cost of educating all three of her children, plus this mother must continue to pay property taxes to the schools even though her children don’t utilize those dollars. Bring up scholarship tax credits around legislators in Frankfort and you’re likely to hear some murmuring about how there must be money in the budget to fund the program before they’ll support it. Yet why didn’t we have a similar line-in-the-sand type of commitment before politicians allowed the approval of [$421 million worth of taxpayer-backed goodies](https://www.kentucky.com/news/politics-government/article208719594.html?ref=bluegrassinstitute.org) for film producers two years ago -- spending that even the economically disjointed Kentucky Center for Economic Policy [couldn’t support?](https://www.courier-journal.com/story/news/politics/2018/05/17/kentucky-film-tax-credits-burden-state-budget/601229002/?ref=bluegrassinstitute.org) It’s disheartening to watch politicians support handing out millions in corporate pork to already-fattened Hollywood moguls while the neediest parents in Kentucky starve for crumbs of educational freedom and the school choice it provides. *Jim Waters is president and CEO of the Bluegrass Institute for Public Policy Solutions, Kentucky’s free-market think tank.* ### Pension contract inviolable, not inflexible URL: https://www.bluegrassinstitute.org/pension-contract-inviolable-not-inflexible/ Last updated: 2025-10-16T22:17:16.000Z Legislators campaigning to hold on to their seats may be jittery about dealing with controversial pension reform, but the problems plaguing the state’s retirement systems don’t hibernate just because there’s an election. Despite record amounts of funding in recent years, the ailing Teachers’ Retirement System (TRS) is saddled with [$14.5 billion worth of liabilities](https://trs.ky.gov/wp-content/uploads/2019/12/2019-TRS-CAFR-Final.pdf?ref=bluegrassinstitute.org), remains under 60% funded and had a negative cash flow last year of about [$300 million](https://www.winchestersun.com/2020/01/08/alvarado-hosts-legislative-update-for-2020-session/?ref=bluegrassinstitute.org). Some critical steps to improve the TRS – particularly in areas of widespread agreement – can and should be taken during the 2020 legislative session. It’s generally accepted that while benefits already earned should be funded at the levels promised, the inviolable contract between the state and its teachers doesn’t prevent future changes. For instance, this contract doesn’t include a provision allowing retiring teachers to spike their pensions with unused sick days in the future just because it’s been past practice. Some of the changes made earlier this century – when the number of unused sick days which can be accrued during an entire career and applied to beneficiaries’ final year of compensation was reduced [from 400 to 300](https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=47842&ref=bluegrassinstitute.org) without any successful legal action stopping it – suggests that Kentucky’s inviolable contract with teachers doesn’t legally prevent modifications to future benefits. In fact, there can be no guarantee in defined benefit pension systems like the TRS that future benefit levels will remain as high as past ones. After all, how can future benefit levels be promised before actuaries even have the chance to look at how the system performed the previous year in order to determine affordable benefits while avoiding harmful liabilities down the road? The primary reason Kentucky faces a huge $48 billion pension liability is because benefits have been increased and then [applied to previous years](http://www.kentuckypensiontruth.com/?ref=bluegrassinstitute.org) when the systems originally funded benefits at an often much-lower level. This problem is compounded when workers and teachers are promised that future benefits will remain at the high levels of the past. While this practice makes everyone feel warm and fuzzy – like we’re doing something to help our teachers – the problem is that such promises are made before it’s even known whether TRS can actually afford to keep them at those higher levels. Not being able to fund them ultimately weakens the system, which certainly doesn't help beneficiaries or retirees. While many Kentucky teachers retire with similar salaries after 27 years, their pension payments vastly differ because of the sick-day policy. Not only do teachers upon retirement receive compensation for 30% of the value of their unused sick days over a career, but that same amount is applied to the salary of the final year they were in the classroom. This practice spikes some pensions by as much as $20,000 annually since retirement payments are determined using the three years in which teachers’ salaries were the highest. Actuaries cannot possibly know ahead of time how much money will be needed to cover these various accounts. The burden on TRS grows as retirees increasingly live longer and collect benefits enhanced for a lifetime. Even $5,000 in additional pension compensation each year for a teacher who retires at 55 years of age and lives until 80 will cost the state an additional $125,000 for which no additional contributions or investments were made into the system to help fund those added benefits. Nothing in the state’s inviolable contract prevents a more reasonable and less-costly approach that still provides a reward for not using sick days while relieving strain on the system. Both sides of the political aisle should be able to agree – even in an election year – that it’s sensible to offer a generous payment to retiring teachers for not using these days while ending the insensible practice of allowing such compensation to spike pension payments forever. *Jim Waters is president and CEO of the Bluegrass Institute for Public Policy Solutions, Kentucky’s free-market think tank.* ### Less-is-more tax policy ‘a great thing’ URL: https://www.bluegrassinstitute.org/less-is-more-tax-policy-a-great-thing/ Last updated: 2025-10-16T22:07:58.000Z Americans not only vote with their hands at the ballot box; they use their feet and moving vans, too. Government population and tax figures indicate more than 20 million residents moved from one state to another between 2002 and 2017 and were part of a huge $3 trillion shift in taxable income between 1997 and 2016. Long before that, the late Supreme Court justice and Louisville native Louis Brandeis popularized the description of states as “laboratories of democracy,” indicating they may “try [novel social and economic experiments](https://www.law.cornell.edu/supremecourt/text/285/262?ref=bluegrassinstitute.org) without risk to the rest of the country.” Some states and their economic experiments – involving primarily tax policy – are thriving and attracting new residents and investors while others are experiencing stagnation and even decline. Kentucky’s at the crossroads. Will we learn from those states thriving with population and economic growth as a result of easing their citizens’ tax burdens? Or, will we succumb to the agenda of regressive leftists pushing a tax-everything-that-moves policy as the best solution for Kentucky’s budgetary woes. Rep. Jim DuPlessis, R-Elizabethtown, in a recent interview with WKU Public Radio rightly promotes [moving Kentucky toward Tennessee’s model](https://www.wkyufm.org/post/efforts-kentucky-eliminate-income-tax-likely-stalled-election-beshear?ref=bluegrassinstitute.org#stream/0) of having no personal income tax while relying on sales taxes paid by buyers. It attracts people and businesses, which “brings more money to their state,” DuPlessis said. It’s not only “a great thing,” as the Hardin County lawmaker opines, but also accurate analysis. U.S. Census data indicate [nearly a quarter-million more people](http://worldpopulationreview.com/states/tennessee-population/?ref=bluegrassinstitute.org) moved into Tennessee between 2005 and 2016 than left the Volunteer State. Meanwhile, only two states lost more than high-tax, big-spending Illinois – another of Kentucky’s neighbors – during the same period. While states always experience people coming and going, 1 million more residents left Illinois than moved into the state during those 11 years. The only other states with larger net losses than Illinois – California and New York – also punish their people with high tax rates, which combined with opposition to common sense spending reforms weaken their economic competitiveness. Punish? That’s right. Income taxes punish productivity. Thus, higher income taxes mean lower productivity. “When you tax something more [you get less of it](https://www.alec.org/app/uploads/2019/01/RSPS-11th-Edition-WEB-LOW-REZ.pdf?ref=bluegrassinstitute.org), and when you tax something less you get more of it,” states the highly acclaimed “Rich States, Poor States” ranking authored by a group including Arthur Laffer, a former economic adviser to President Ronald Reagan and Prime Minister Margaret Thatcher, who himself was one of the 1.6 million net out-migrators who left California during the decade beginning in 2005 and moved to low-tax Tennessee. That $3 trillion shift in taxable income indicates many entrepreneurs and wealth creators followed suit. Hedge fund manager and Carolina Panthers’ owner David Tepper in 2016 caused all of New Jersey’s high-taxing state government to shudder by relocating to no-income-tax Florida, taking hundreds of millions in tax revenue with him. States embracing the more-is-less principle regarding tax policy are discovering it’s much more than a nice-sounding platitude. It’s key to their economic growth and vitality. As Laffer notes, a state’s tax burden “is most consequential” among the various policies used to determine economic performance. It’s not coincidental, for example, that while Tennessee has one of the nation’s lowest overall tax burdens – even with its high sales-tax rate – it also enjoyed a 36% increase in state and local revenues between 2005 and 2015 with substantial growth in population, employment, personal income and manufacturing. Tennesseans also enjoy the [smallest share of unfunded liabilities](https://www.alec.org/app/uploads/2019/01/RSPS-11th-Edition-WEB-LOW-REZ.pdf?ref=bluegrassinstitute.org) in the entire nation, thanks to a nearly fully funded pension system. Kentucky’s southern neighbor with whom it shares its largest border has created a booming economy, grown its population and nearly eliminated its pension problems – all with no income tax. It is, indeed, “a great thing” for Tennessee and would be for Kentucky, too. *Jim Waters is president and CEO of the Bluegrass Institute for Public Policy Solutions, Kentucky’s free-market think tank.* ### Education since Rose: Remove the rose-colored glasses URL: https://www.bluegrassinstitute.org/education-since-rose-remove-the-rose-colored-glasses/ Last updated: 2025-10-16T21:43:04.000Z It’s been 30 years since the Kentucky Supreme Court’s Rose v. Council for Better Education decision declared the entire body of the commonwealth’s school laws unconstitutional. The ruling, which resulted in the single largest tax increase in the state’s history, went far beyond the initial claims of the lawsuit, which were primarily focused on money. Instead, the justices, who wanted a radically improved education system, said a total education overhaul was needed that involved more than just financial issues. Get ready for loud applause from some in the public-education sector wearing rose-colored glasses and yapping about all the progress made since the court’s decision. How much of the hoopla is justified? You’ll get no argument here about the state of – or spending on – public education in Kentucky when the court ruled in 1989. U.S. Census Bureau reports indicate Kentucky’s total school revenue from all sources during the 1988-89 term amounted to only $3,206 per pupil, which ranked 46th among the states. Yet the data indicate the Rose decision may have done much more to solve funding problems than it did to actually bring significant improved academic achievement. While some – usually those in the system – continue to drone on about not having enough money, the latest Census data from 2017 shows Kentucky schools now receive $11,578 per pupil, which moved the state up in the rankings. Even after adjusting for inflation, per-pupil spending in 1989 would be $6,328 in equivalent 2017 dollars, which means taxpayers have put up $5,250 for each student in additional real dollars, amounting to a whopping post-inflation increase of 83% – not exactly a shabby performance in one of the nation’s historically poorest states. Yet while spending has dramatically increased, the same cannot be said for academic performance. Still, the cheerleaders will be out in full force. Give me an “R-O-S-E.” “What’s it spell? Great strides!” “What’s it spell? Great strides!” “I can’t hear you!! Great strides!” Of course, good cheerleaders twirl their poms poms without much consideration about the story being told by the scoreboard. Just a few years after the Rose decision, results from the first state-level testing by the National Assessment of Educational Progress (NAEP) showed Kentucky’s schools had a whole lot of work to do. For example, only 13% of Kentucky’s fourth-grade whites and an abysmal 3% of Blacks scored proficient in math in 1992. Flash forward more than a quarter century and the latest NAEP results indicate math-proficiency rates in 2017 were only 45% for Kentucky’s white fourth-graders and just 15% for Blacks. Math-proficiency results for white eighth-graders were even worse, indicating that while there may have been some improvement from 1990 when only 11% of these middle-schoolers were proficient – so any change would essentially be an improvement – still by 2017 fewer than one out of three made the grade. Time almost stood still for Blacks. Only 2% of Kentucky’s black eighth-grade students were deemed math-proficient in 1990; by 2017, still fewer than 10% of Blacks reached the plateau of proficiency. Neither have Kentucky’s eighth-grade white students done well on NAEP math scores when compared to whites in other states. White students in 41 other states, including in the notoriously problematic District of Columbia schools, outscored Kentucky’s whites on NAEP’s 2017 eighth-grade math results in a statistically significant manner. It’s not very encouraging, especially considering overall math-proficiency rates for eighth-grade students nationwide still run only 33%. This is all Kentucky’s schools have accomplished in the decades since Rose and falls way short of the justices’ vision of holistic improvement stretching beyond spending and state budgets to classrooms and improved opportunities for students. Don’t expect the Rose-at-30 cheerleaders to provide the full story about Kentucky’s educational performance. I, on the other hand, own no rose-colored glasses. *Jim Waters is president and CEO of the Bluegrass Institute for Public Policy Solutions, Kentucky’s free-market think tank.* ### Pension Shock: How Did We Get Here? URL: https://www.bluegrassinstitute.org/pension-shock-how-did-we-get-here/ Last updated: 2025-12-09T14:21:27.000Z ## Introduction For much of the past decade, the Bluegrass Institute for Public Policy Solutions has led from the forefront of pension reform in the commonwealth of Kentucky. [Pension Shock: How Did We Get Here?The true cause of Kentucky's pension crisis differs greatly from the typical scapegoats.Bluegrass-Institute-Pension-Shock-How-did-we-get-here\_Saddle-Stitch.pdf4 MBdownload-circle](https://www.bluegrassinstitute.org/content/files/2025/12/Bluegrass-Institute-Pension-Shock-How-did-we-get-here%5FSaddle-Stitch.pdf "Download") "Future Shock," the institute's groundbreaking four-part series released in 2011 and 2012, warned that without meaningful reforms, the pension liability would engulf Kentucky's entire economy. ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) In a column published by the Bluegrass Institute on March 26, 2013, the late Lowell Reese, an esteemed journalist, publisher and former Chamber of Commerce executive, urged policymakers to take seriously the need to address the commonwealth's deepening pension crisis. **"The soaring cost of public employee pensions in Kentucky has become a major societal issue," said Reese, who authored the "Future Shock" series. "The standard of living of all Kentuckians is at stake."** The ensuing years, which included Reese – who had been exposed to Agent Orange while fighting communism as a platoon leader in the jungles of southeast Asia – leaving us to finish this pension reform work, proved him an accurate prophet. **Pension costs consume nearly 15 percent of Kentucky's latest biennial budget passed in April by the General Assembly.** Legislators passed an accompanying bill that purports to raise nearly a half-billion worth of new revenue by levying sales taxes on previously exempt products and services in order to fund increasing pension payments. The $3.3 billion worth of pension expenditures in this year's budget are resources not available for other important services, including educating Kentucky's children, **improving the state's infrastructure or hiring more law enforcement personnel to keep our communities safe.** If that was the end of the story, it would be cause enough for concern. Unfortunately, the news only gets worse. 💡 Even with record amounts of funding placed into the systems along with tax increases to prop up those expenditures, the liabilities of the state's retirement systems continue to increase while their funding levels continue to decline. When Reese made his statement, the six state pension plans, which are under the umbrella of the Kentucky Retirement Systems (KRS) and the Teachers' Retirement System (TRS), carried a combined unfunded liability of around $31 billion. That number has nearly doubled today, in part because of new government reporting requirements and more realistic assessments regarding the plans' expected investment performance. The alarming rapidity with which the systems' funding levels have declined should add a sense of urgency regarding the need to confront these liabilities. In 2000, the commonwealth's pension debt was a meager $960 million, five of Kentucky's six public pension systems were running generous surpluses and the Bluegrass State's pension system was among the nation's strongest. Recent reports indicate the Kentucky Employees Retirement System (KERS) – the largest plan for nonteaching state workers – is now less than 14 percent funded, meaning the system's assets cover less than 14 percent of the benefits owed to its members. This is a far cry from the system's healthy 139.5 percent funding level in 2000 when pension experts nationwide deemed KERS one of the healthiest government-run pension plans in the nation. Only 14 short years later, the Center for Retirement Research at Boston College called KERS the most underfunded U.S. state pension plan. Urgent reforms also are needed for the TRS, which, while appearing to be in much-better shape with its 56 percent funding level, is still in dire straits, having fallen from an 82.5 percent funding level in 2000 and now facing the reality that it's lacking more than 40 percent of the assets needed to cover its obligation to its members. ****Educate your inbox.** Get the Bluegrass Institute's once-weekly policy update. [Sign Up ](https://mailchi.mp/bluegrassinstitute.org/weekly?ref=bluegrassinstitute.org) ## What happens if drastic steps toward meaningful reform don't occur? Defenders of the status quo, including beneficiaries' and retirees' groups, along with union leaders, often don't accept how dire Kentucky's pension situation is and the urgent need for reform. Their version of reform primarily centers on raising taxes and placing pension benefits as the commonwealth's highest priority, without seemingly much genuine regard for other policy needs. They may be getting their way, as legislators, afraid of offending state workers and teachers, who together form Kentucky's largest single voting bloc, demonstrated their willingness not only to put records amounts of taxpayer dollars into the commonwealth's sinking retirement systems as part of the biennial fiscal 2019-2021 General Fund budget, but hurriedly enacted those previously mentioned sales-tax increases in a somewhat arbitrary manner. These tax hikes on selected businesses reveal lawmakers seemed more willing to increase the burden for funding the commonwealth's increasing pension liability on small businesses rather than risk offending current public workers, teachers and their union leaders by freezing benefits at current accrual rates, asking beneficiaries to pay more and offering more reasonable benefits in the future. Further rating agency downgrades resulting in increased borrowing costs for the state when issuing municipal bonds offer another serious consequence of not heeding the urgent need for meaningful reforms. Following an earlier downgrade by Moody's on July 20, 2017, Standard and Poor's downgraded Kentucky's debt on May 18, 2018 – even after the two-year budget containing more pension funding and legislation raising nearly a half-billion dollars in new taxes was passed. In order to understand where Kentucky – and many other states also facing steep declines in their public retirement systems – need to go from here, it's vital that we comprehend how we arrived at a $60 billion unfunded liability and that the truth be told and understood. While the 19th century Spanish philosopher George Santayana likely wasn't thinking about the arbitrary and wrongheaded decisions leading to 21st century state retirement systems sliding into dire straits, his comment that "those who cannot remember the past are condemned to repeat it" seems nonetheless extremely appropriate, considering our goal with this first in our "Pension Shock" series is to point to key developments throughout the history of our pension system that we believe have been largely unknown or ignored. While some policymakers, union leaders and beneficiaries' representatives show little appetite for understanding how Kentucky arrived in its current predicament, we believe it's unrealistic to try and build a structure offering solutions without a solid foundation, which, in this case, involves confronting past decisions that Bluegrass State taxpayers are paying more for today than ever before. Perhaps the redeeming factor to arise from the pain of such confrontation will be that we neither forget nor repeat such history. ## It's the benefits, stupid! Through rigorous analysis of credible data and the uncovering of startling facts gleaned from research and obtained via open records requests, the Bluegrass Institute Pension Reform Team has unearthed the true cause of Kentucky's pension crisis, which differs greatly from the typical culprits – funding deficiencies and poor investment returns – blamed by the media, politicians and state employee unions. While the Great Recession, which began at the end of 2007, certainly did result in lower investment returns for a few years in most portfolios – including those belonging to the commonwealth's retirement system – the overall health of portfolios, whether they belong to individuals or pension plans, isn't determined by a handful of years. However, defenders of the status quo often point to smaller and less-revealing periods of time in an attempt to defend their claims that poor investment returns are a primary contributor to Kentucky's current pension liability. From a cynical point of view, such limited views could be considered calculated attempts to avoid any discussion about the need for changing the process by which benefits are awarded. Conclusions regarding investment performance are reached by analyzing a long period of time and cycles of market gain and loss. Considering, for example, that KRS and TRS investments have significantly outperformed expectations by reaping returns of more than 8 percent over a 30-year period means the primary problems contributing to the retirement systems' decline must be found elsewhere. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/12/image.png) Also, along with the record amounts of funding designated for the state's pension plans during the current budget, there are myriad indications that funding is not the primary cause of Kentucky's pension woes. For instance, the County Employees Retirement System (CERS), which operates under the KRS umbrella and serves local workers in the system, is required by state law to annually pay 100 percent of the Actuarially Required Contribution (ARC) to cover its beneficiaries, yet the system isn't even 60 percent funded. In fact, the CERS funding level is experiencing rapid declines, having dropped from 110.7 percent to 52.8 percent between 2000 and 2016, again despite receiving employers' full ARC payments. While funding and investment returns certainly are critical elements to healthy pension systems, they are only two of the Kentucky pension systems' three-legged stool. Implementing effective and lasting reform will require the truth be told and understood about the third leg of that stool: benefits. A closer look reveals that the process by which benefits have been awarded to Kentucky's public employees during the past 30 years is the primary cause of the commonwealth's pension crisis. Unfortunately, public employee union leaders and anti-reform legislators have been untruthful when discussing the true cause of the pension crisis with their constituents. Instead of being honest about the pension predicament, including how the process of awarding benefits is the chief culprit, they instead attempt to use Kentucky's pension woes to gain and retain power and influence, primarily through their resistance to change. The result is that common sense and reasonable reforms to save and put these systems on a sustainable course for the future have been marginalized or ignored altogether. However, maintaining the status quo, resulting in the combined liability of Kentucky's public pension systems growing from $960 million in 2000 to around $60 billion today, and funding levels dropping precipitously – with KERS nearing insolvency – isn't a wise or viable option. Rather, it would be highly irresponsible, considering the pension crisis is the most looming threat to Kentucky's economy in decades and is crowding out funding for education, public safety, healthcare and infrastructure. Finally, those on all sides of the pension reform issue, though they might disagree, should treat each other with dignity and respect while working toward solutions. The increasing amount of debate and discussion surrounding this issue should focus on data and facts – the truth, in other words – rather than harmful, emotional rhetoric that will only serve to exacerbate problems and stand in the way of finding and reaching solutions. --- ### Benefits Granted Without Knowing the Cost Since this analysis focuses on what we believe is the primary contributor to Kentucky's pension crisis, namely the process by which benefits are determined and awarded, here are some general statements regarding what we believe regarding the evidence we've uncovered: *Arbitrary and illegal benefit enhancements are regularly awarded retroactively to workers and retirees.* *Many benefit enhancements have been awarded without a statutorily-required cost analysis to determine the monetary impact on the pension system prior to being approved.* *Despite the fact that many illegal benefit enhancements have been awarded, these should not be clawed back from employees or retirees. However, a structural change in the awarding of future benefits must happen immediately.* *Actuaries were complicit in enabling the practices that contributed to this crisis. At best, they accepted without question data from the systems that obviously was inaccurate. At worst, they provided cover for legislators and employees by working with them to falsely hide the true cost of decisions being made regarding benefits.* --- "Future is foggy for state pensions" was the title of a disturbing report on the front page of the November 29, 1999, edition of the Lexington Herald-Leader. The article reveals that at least some state policymakers knew about the need to reform the structure of benefits propped up by several years of unusually high investment returns, which, in turn, had produced large amounts of cash. At the time of that article, the TRS was 97.3 percent funded while the KERS non-hazardous funding level was even healthier at 121.9 percent. The economy was strong, riding the wave of a stock-market performance producing abnormally high gains for pension portfolios. According to the Herald-Leader report, strong investment returns grew Kentucky Retirement Systems' assets from $3.2 billion in fiscal 1988-89 to $12.8 billion only a decade later. Such growth in investment returns effectively masked the serious structural weaknesses of the benefit-awarding process, which would become all-too-evident a few years later when that same economy came to a screeching halt and the bubble that had carried the stock market to historically record gains would burst loudly and quickly. The subtitle of the Herald-Leader report surely brings this point home: "Benefits are improving but with unknown effects." The truth is, Kentucky is now facing the consequences of the "unknown effects" of those generous benefits. Taking advantage of the systems becoming flush with cash due to the aberrantly prosperous investment returns for a period of time, the Kentucky Education Association and other state employee groups requested numerous unfunded benefit enhancements for both current workers and retirees. They sought these higher benefits without proper prefunding – a key for defined-benefit systems to avoid unfunded liabilities – or perhaps even more important, without having a clue as to what these augmentations would cost. These types of unfunded, and oftentimes retroactive, benefit increases began the demise of the once-healthy and well-funded pension systems. Since its inception in 2015, the Bluegrass Institute Pension Reform Team has focused on benefit enhancements conferred in the final years of the 20th century. It turns out we weren't the only ones concerned about the long-term impact of those increases. Gov. Paul Patton's administration, in power during that time, expressed concerns about the boost in benefits nearly before the ink had dried on their approval by the legislature. The Herald-Leader reports the Patton administration was raising questions in 1999 regarding the impact that the cost of the pension system would have on his ability to "fund new, long-term programs in the 2000-2002 budget," and how the governor was seeking "a better handle on how recent retirement changes will figure into the financial outlook for the state." As these benefit increases were being debated with even more sought by the unions and their public-worker constituents, serious concerns abounded about their ultimate cost, as well as the impact they would have on other services citizens expect government to provide. It's telling that the Patton administration was concerned about the eventual cost of such large pension benefit enhancements even with the state's retirement funds were flush with cash and, in many cases, more than fully funded. "If we continue to piecemeal these kinds of changes in benefits that impact the financial condition of these funds without looking seriously at what the long-term impacts are of those changes, we could really be impacting the long-term financial health of the system," Crit Luallen, Patton's cabinet secretary, said, as reported by the Herald-Leader. Despite the systems' high funding levels at the time, Luallen and the Patton administration were right to be troubled not only about the enhancement of pension benefits in the years just before the page turned to the new century, but also because state employees were seeking to drive benefits even higher. --- ## What the Research Found The Herald-Leader's report, which outlines both the benefit enhancements obtained in 1996 and 1998 as well as the planned new increases on top of those, offers a fairly comprehensive view of the different elements used to increase public retirement checks, not just in those final years of the 20th century but throughout the history of Kentucky's retirement systems: - Increasing retroactively to the first year of service the benefit factor used to calculate employee's pension income. - Enhanced final compensation by changing salary determination to the highest three rather than highest five years of salary. - Spiking of benefits by colluding with employers to get double-digit raises during the final year of work in order to drive up retirement compensation. - Ad hoc cost-of-living adjustments (COLAs). - Adding employee allowances such as those related to uniform, equipment or other gear to final compensation amounts. - Prospective benefit guarantees, meaning future unearned benefits cannot be changed. ![](https://storage.ghost.io/c/53/d3/53d3d9df-ebeb-488c-bde8-096c9490d2d8/content/images/2025/12/image-1.png) 💡 While there is a desire among some, particularly beneficiaries and their political enablers in the legislature, to avoid discussing the history of Kentucky's public pension systems, we believe it's vitally important to understand how legislation passed 20 years ago can, even today, be "impacting the long-term financial health of the system," as former Cabinet Secretary Luallen stated in the Herald-Leader report on November 29, 1999. It's vital to understand, for instance, how passage of Senate Bill 142 (SB 142) in 1998 contributed to the rapid decline in KERS funding levels. This legislation: - Raised the benefit factor for all KERS non-hazardous employees from 1.97 percent to 2 percent, applied it retroactively to all years of service and left in place an expectation that prospective benefit accrual rates would never fall below 2 percent; - Created a 10-year window during which pension amounts received by members eligible for retirement and who went ahead and retired during that decade would be determined based on their highest three years of salary instead of the previous highest five years of pay; - Awarded employees who retired during that 10-year window an even-higher benefit factor of 2.2 percent that would apply to every year of service retroactively – even those years previous to the 10-year window. Thus, a KERS member who earned a 1.25 percent benefit factor in 1960, when the compensation formula was based on the highest five years of salary, and who later retired between 1998 and 2008 received a 2.2 percent benefit factor based on the enhanced high-three formula for service rendered between 38 and 48 years earlier. These benefit enhancements were not funded with either employee or employer payroll contributions but were enacted with no additional funding for two years. Worse, they totally disrupted the KERS's defined benefit system by enhancing benefits awarded – and more properly funded – at lower levels in previous years with, again, no additional funding for those enhancements. It doesn't appear that the actuaries working for Kentucky's retirement systems and who served as the primary advisers for the General Assembly when SB 142 was debated and passed offered much beyond lip service, if that, to slow this gravy train filled with shiny new expensive benefits. In fact, it was just the opposite. Herald-Leader reporters Jack Brammer and Bill Estep write that an in-house group created by Patton following passage of SB 142 in 1998 to “determine the impact of four pension changes the legislature approved in 1996 and 1998 … concluded that they are financially sound and that pension benefits for state employees are ‘relatively generous’ compared to those of other states.” Yet it was Luallen’s fears that won out over actuaries’ unfounded optimism. KERS’s funding level began dropping not long after that Herald-Leader report and continues to decline even in the present, where the system is barely 14 percent funded. No wonder, as Brammer and Estep report, “the administration plans to hire an outside consultant for comprehensive study of Kentucky’s state-employee retirement system.” --- ### Law Requiring Cost Analysis Ignored for Decades Nearly all benefit enhancements throughout the history of Kentucky's public pension systems were granted while ignoring statutory requirements that independent cost analyses be conducted prior to legislative votes approving changes in benefits. Thus state legislators approved numerous enhancements with little idea as to their actual cost or impact on the state budget and taxpayers. KRS 6.350, implemented in 1980, states: "A bill which would increase or decrease the benefits … of any state-administered retirement system shall not be reported from a legislative committee … for consideration by the full membership of the House unless the bill is accompanied by an actuarial analysis." The Bluegrass Institute cited the statute in an open records request filed on March 21, 2016, with the Legislative Research Commission (LRC), seeking copies of actuarial analyses for each of the numerous benefit enhancements granted during the past 30 years. The response from the LRC's general counsel shockingly stated that "the lack of actuarial analyses has no impact on the validity of enacted legislation. In recognition that actuarial analyses are procedural rather than substantive, the Supreme Court of Kentucky found that the failure of the General Assembly to obtain an actuarial analysis under KRS 6.350 does not invalidate a law thus passed." In our response to the LRC on March 31, 2016, we made the following comments: "The purpose of the actuarial analysis is to determine the cost of legislation that creates new benefits or enhances existing benefits before it is enacted. The data produced by an actuarial analysis allows legislators to make informed decisions and to fully understand the financial implications of the legislation under consideration. The failure to perform an actuarial analysis makes it impossible to prefund new or enhanced benefits because the cost of new benefits has yet to be determined. "The failure to prefund benefits creates unfunded liabilities and contradicts standard actuarial funding procedures. Consequently, the failure to comply with KRS 6.350 allows uninformed legislators to confer unfunded benefits creating unfunded liabilities at an indeterminate cost to the commonwealth and taxpayers. "The benefits in our open records request would not have been awarded if the legislature had followed basic statutory requirements and standard actuarial funding procedures, and our pension system would be fully funded." --- *In dismissing the failure of the General Assembly to follow KRS 6.350, the LRC's general counsel essentially claims that legislators can pass laws placing an enormous future burden on the citizens of Kentucky without being required to follow a commonsense state statute requiring them to quantify and budget the future costs. And they have done so several times since 1980, including:* - Increasing the CERS non-hazardous benefit factor from 1.6 percent to 1.65 percent which took effect on July 1, 1984; from 1.65 percent to 1.85 percent in 1986; from 1.85 percent to 2 percent in 1988; and from 2 percent to 2.2 percent in 1990. - Increasing the KERS non-hazardous benefit factor from 1.6 percent to 1.65 percent, which took effect on July 1, 1984; from 1.65 percent to 1.85 percent in 1986; from 1.85 percent to 1.91 percent in 1988; from 1.91 percent to 1.97 percent in 1990; and from 1.97 percent to 2.2 percent in 1999. - Increasing the TRS benefit factor from 2 percent to 2.5 percent, which took effect on July 1, 1983, use of the "high 3" final compensation benefit calculation for members who are at least 55 years old with a minimum of 27 years of service, and the 3 percent benefit factor for service in excess of 30 years. - All COLA increases for KRS and TRS beneficiaries and retirees. - All enhancements to KRS or TRS health insurance benefits. --- The LRC eventually supplied us with a single independent actuarial analysis related to a benefit enhancement (Attachment C). Ironically, it involved an increase in the benefit multiplier used in determining the income to be received in retirement by KERS retirees as part of SB 142 passed in 1998 and examined earlier in this report for its shocking impact on the system's funding levels. Remarkably, the actuary discouraged legislators from approving the benefit enhancements in SB 142\. Among his comments: - Raised the benefit factor for all KERS non-hazardous employees from 1.97 percent to 2 percent, applied it retroactively to all years of service and left in place an expectation that prospective benefit accrual rates would never fall below 2 percent. - Created a 10-year window during which pension amounts received by members eligible for retirement and who went ahead and retired during that decade would be determined based on their highest three years of salary instead of the previous highest five years of pay. - Awarded employees who retired during that 10-year window an even-higher benefit factor of 2.2 percent that would apply to every year of service retroactively – even those years previous to the 10-year window. 💡 Despite the warnings from the lone independent actuarial analysis done since passage of KRS 6.350 that the arbitrary, unfunded benefit enhancements contained in SB 142 did not represent an effective use of public dollars, would result in spendable income for retirees exceeding pre-retirement spendable income and cost taxpayers nearly $280 million over the next 30 years, the Kentucky House of Representatives voted 93-020 in favor of the bill and its fattened benefits. ## Conclusion However, like is the case with many past profligate spending bills, most of the legislators received the political benefits of SB 142 reaped from overjoyed state workers who hit the taxpayer-funded jackpot but are no longer in the General Assembly as the bills come due. It's now left up to current and future leaders to do their best to clean up the costly mess left behind. The short-term thinking of those who believe the answer to Kentucky's pension crisis is simply to continue to raise taxes and increase funding is that no only do tax hikes increase the burden on Kentucky workers, but, even worse, without structural reform, the additional dollars that higher taxes may bring will not ultimately solve the problem. There must be a structural reform of the benefits before additional funding – wherever it's found – will significantly address one of the nation's largest state pension liability. While we will address such structural reforms in a future release as part of this "Pension Shock" series of policy reports, understanding how past practices of ignoring cost controls and accountability measures – such as refusing to obtain independent analyses of proposed benefit enhancements – are affecting our ability to once again make Kentucky's pensions systems sustainable, as this report shows, are vital to ensuring we don't repeat the past. ## Footnotes 1. Reese, Lowell, "Future Shock," a series of four policy briefs addressing Kentucky's public pension crisis, Bluegrass Institute for Public Policy Solutions: http://www.freedomkentucky.org/Future\_Shock. 2. Reese, "Overspending: the source of Kentucky's pension crisis," Bluegrass Institute for Public Policy Solutions: http://www.bipps.org/overspending-the-source-of-kentuckys-pension-crisis/. 3. Waters, Jim, "Bluegrass Beacon: Will pension funding engulf entire budget?", Bluegrass Institute for Public Policy Solutions, January 29, 2018: http://www.bipps.org/bluegrass-beacon-will-pension-funding-engulf-entire-budget/. 4. "Kentucky politicians raised taxes by a half-billion dollars during session," Bluegrass Institute for Public Policy Solutions: http://www.bipps.org/wp-content/uploads/2018/05/Bluegrass-Institute\_17-Tax-Increases-Handout.pdf. 5. Loftus, Tom, "As Senate budget takes money from teacher pensions to fund others, some claim retaliation," Louisville Courier Journal, March 22, 2018: https://www.courier-journal.com/story/news/politics/2018/03/22/kentucky-teachers-retirement-system-pensions-senate-budget-bill/445502002/. 6. "Kentucky State Pension Crackdown Bankrupts Health Agency," Newsmax: https://www.newsmax.com/finance/kentucky-pension-health-bankrupcty/2014/09/26/id/597145/. 7. Loftus: https://www.courier-journal.com/story/news/politics/2018/03/22/kentucky-teachers-retirement-system-pensions-senate-budget-bill/445502002/. 8. Reese, "Future Shock: Legislators stoking the coals on Kentucky's runaway pension train," Bluegrass Institute for Public Policy Solutions, Page 2: http://www.freedomkentucky.org/images/9/9f/Future\_Shock-\_Legislators\_stoking\_the\_coals\_on\_Kentucky%E2%80%99s\_runaway\_pension\_train\_FINAL.pdf. 9. "Rating Action: Moody's downgrades Kentucky to Aa3; outlook stable," Moody's Investors Service, July 20, 2017: https://www.moodys.com/research/Moodys-downgrades-Kentucky-to-Aa3-outlook-stable--PR\_904135028. 10. "S&P Downgrades Kentucky Debt," Aquila Distributors LLC, May 21, 2018: https://aquilafunds.com/2018/05/21/sp-downgrades-kentucky-debt/#.W2nGlYWcGM9. 11. "Sound Solutions for Kentucky's Public Pension Crisis," Bluegrass Institute for Public Policy Solutions, Slide 15: http://www.bipps.org/wp-content/uploads/2017/07/BIPPS-Sound-Solutions-for-Kentuckys-Pension-Crisis-.pdf. 12. Reese, Page 2: http://www.freedomkentucky.org/images/9/9f/Future\_Shock-\_Legislators\_stoking\_the\_coals\_on\_Kentucky%E2%80%99s\_runaway\_pension\_train\_FINAL.pdf. 13. Cheves, John, "Kentucky's public pension debt grew by more than $5 billion last year," Lexington Herald-Leader, Nov. 13, 2017: https://www.kentucky.com/news/politics-government/article184323228.html. 14. Waters, "Bluegrass Beacon: Giving unaffordable pension benefits an economically fatal practice," Bluegrass Institute for Public Policy Solutions, May 23, 2017: http://www.bipps.org/bluegrass-beacon-giving-unaffordable-pension-benefits-economically-fatal-practice/. 15. Text and vote history of Senate Bill 142, Legislative Research Commission: http://www.lrc.ky.gov/recarch/98rs/SB142.htm. 16. "Sound Solutions for Kentucky's Public Pension Crisis," Bluegrass Institute for Public Policy Solutions, Slide 11: http://www.bipps.org/wp-content/uploads/2017/07/BIPPS-Sound-Solutions-for-Kentuckys-Pension-Crisis-.pdf. 17. "Policy Brief: An analysis of Senate Bill 1," Bluegrass Institute Pension Reform Team: http://www.bipps.org/bluegrass-institute-policy-brief-analysis-senate-bill-1/. 18. Ibid. 19. Complete text of KRS 6.350, Legislative Research Commission: http://www.lrc.ky.gov/Statutes/statute.aspx?id=45529. 20. Text and vote history of Senate Bill 142, Legislative Research Commission: http://www.lrc.ky.gov/recarch/98rs/SB142.htm. --- [Pension Shock: How Did We Get Here?The true cause of Kentucky's pension crisis differs greatly from the typical scapegoats.Bluegrass-Institute-Pension-Shock-How-did-we-get-here\_Saddle-Stitch.pdf4 MBdownload-circle](https://www.bluegrassinstitute.org/content/files/2025/12/Bluegrass-Institute-Pension-Shock-How-did-we-get-here%5FSaddle-Stitch.pdf "Download") ### School Based Decision Making Policy: A Closer Look URL: https://www.bluegrassinstitute.org/school-based-decision-making-policy-a-closer-look-2/ Last updated: 2026-02-23T20:59:12.000Z This report by Richard Innes examines Kentucky's School Based Decision Making (SBDM) program, a signature feature of the 1990 Kentucky Education Reform Act that transferred sweeping authority over curriculum, staffing, and budgets from locally elected school boards to school-level councils composed primarily of principals and teachers. [School Based Decision Making Policy - A Closer Look Corrections CopySchool Based Decision Making Policy - A Closer Look Corrections Copy.pdf2 MBdownload-circle](https://www.bluegrassinstitute.org/content/files/2026/02/School-Based-Decision-Making-Policy---A-Closer-Look-Corrections-Copy.pdf "Download") After more than a quarter-century of operation, the report finds that virtually no comprehensive research on SBDM effectiveness has been conducted since 2001, that management audits of the state's lowest-performing "Priority Schools" reveal widespread dysfunction in long-established councils — including curriculum neglect, failure to use data, and poor stakeholder engagement — and that parent participation in council elections is strikingly low, with nearly three-quarters of Kentucky schools showing single-digit ratios of voting parents to student enrollment. Meanwhile, student achievement on the NAEP has improved at an agonizingly slow pace, with proficiency rates for Black students remaining deeply alarming. **Key Takeaways** - **SBDM councils in the lowest-performing schools were chronically dysfunctional.** Management audits of 10 Priority Schools revealed that these long-established councils routinely failed to adopt or implement needed policies, neglected curriculum development, ignored data-driven decision making, and excluded key stakeholders — problems that persisted for over 15 years without correction until external intervention forced change. Two-thirds of all Priority Schools ultimately had their SBDM authority removed. - **Parent engagement — a central goal of the program — has largely failed.** In 818 of 1,124 Kentucky public schools, fewer than 10 percent of students were represented by a voting parent in SBDM elections. In 101 schools the ratio was below one percent. Only 15 schools statewide exceeded 50 percent, suggesting that the promise of meaningful parental involvement in school governance remains overwhelmingly unmet. - **The research vacuum is itself a policy failure.** Despite numerous unresolved questions about SBDM functioning identified as early as 2001, virtually no follow-on research was ever conducted. This means Kentucky has continued to operate under a highly experimental governance model for decades without any systematic evaluation of whether it serves students well — or whether it insulates poor leadership from accountability. The report suggests that Kentucky's SBDM model, whatever its original aspirations, has not delivered on its core promises of improved student outcomes and meaningful parent engagement. Instead, it has created a governance structure that can shield failing schools from the corrective authority of locally elected boards and superintendents, while placing unrealistic demands on school-level personnel who often lack the time, training, and expertise to handle complex decisions around curriculum, budgeting, and staffing. Policymakers should seriously consider restoring meaningful authority to locally elected school boards and district superintendents, while ensuring that any retained elements of school-level governance are subject to regular evaluation, transparent accountability, and genuine parental empowerment. ### Shining the Light on Kentucky’s Sunshine Laws URL: https://www.bluegrassinstitute.org/shining-the-light-on-kentuckys-sunshine-laws/ Last updated: 2026-05-13T15:54:08.000Z [Shining-the-Light-on-Ky’s-Sunshine-Laws.-BensenhaverA Proposal for Legislative Revision to Kentucky’s Open Meetings and Open Records LawsBIPPS-Policy-Report.-Shining-the-Light-on-Ky’s-Sunshine-Laws.-Bensenhaver.pdf460 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2026/05/BIPPS-Policy-Report.-Shining-the-Light-on-Ky---s-Sunshine-Laws.-Bensenhaver.pdf "Download") Kentucky's open meetings and open records laws — enacted in the 1970s and last comprehensively revised in the early 1990s — have served as essential tools for ensuring government transparency and accountability, anchored in the legislative declaration that "the formation of public policy is public business and shall not be conducted in secret." Yet more than two decades of litigation, technological transformation, and evolving agency practice have exposed serious deficiencies that undermine the laws' effectiveness. Ambiguous definitions of "public agency," loopholes permitting serial less-than-quorum meetings, conflicting exemptions between the two statutes, an exception in KRS 61.815(2) that nearly swallows the rule requiring proper notice before closed sessions, anachronistic references to obsolete formats like ASCII, and uncertainty over whether public business conducted on private devices and accounts constitutes a public record all combine to invite agency exploitation and unnecessary litigation. This report, authored by former Assistant Attorney General Amye Bensenhaver, proposes a comprehensive legislative revision focused not on weakening the laws but on clarifying, reconciling, and modernizing them — guided throughout by the General Assembly's longstanding presumption in favor of openness. **Key Takeaways:** **The statutes contain critical ambiguities that agencies routinely exploit.** The 2012 amendment to KRS 61.870(1)(h) muddied the definition of which privately operated, publicly funded entities qualify as "public agencies," enabling contractors that derive nearly all their revenue from public funds to disclaim public-agency status. Likewise, the 1992 prohibition on serial less-than-quorum meetings is undermined by a required showing of intent and a broad "education" exception that public bodies — including the University of Kentucky Board of Trustees — have invoked to justify private discussion of major public business such as the university budget. **Internal conflicts in the laws produce absurd and inequitable results.** Records lawfully withheld under an open records exemption (proposed budgets, performance evaluations, licensure exam questions) often have no corresponding open meetings exemption, forcing agencies to publicly discuss documents they may withhold. Meanwhile, KRS 61.815(2) creates an exception that effectively excuses agencies from the notice requirements of KRS 61.815(1) for 12 of 13 closed-session categories, and the open meetings law — unlike the open records law — fails to place the burden of proof on the public agency, leaving complainants to prove facts known only to the officials they are challenging. **The laws are stuck in the analog era.** Built around ASCII as the standard electronic format, lacking meaningful provisions for email, smartphones, video conferencing platforms, and social media, and silent on whether public business conducted on private devices generates public records, the statutes fail to reflect the realities of 21st-century governance. Combined with weak penalties ($25 per day for willful records withholding; $100 per incident for open meetings violations, unchanged since the 1970s) and a training requirement that verifies only distribution of materials rather than actual comprehension, the laws too often yield to evasion rather than ensure compliance. **Conclusion:** Kentucky's sunshine laws remain among the nation's most robust statements of the principle that government belongs to the governed — but principles unsupported by precise, modern, and enforceable statutory language will continue to be eroded by the agencies they are meant to constrain. The General Assembly should undertake a comprehensive revision aimed at preservation through repair, beginning with several concrete reforms. Lawmakers should reconsider the 2012 amendments to KRS 61.870(1)(h), clarify the 25-percent funding threshold, and empower the attorney general to compel financial substantiation from entities disputing public-agency status. They should reformulate KRS 61.810(2) to close the intent and education loopholes that enable rolling-quorum evasion, and they should repeal KRS 61.815(2) outright to restore the integrity of the notice requirements governing closed sessions. The two statutes should be reconciled where they conflict — either by harmonizing exemptions or, where confidentiality is genuinely warranted, by adopting paired open meetings and open records exemptions of the kind enacted in 2005 for homeland-security records. The burden of proof should be placed squarely on public agencies in open meetings disputes, as it already is in open records cases. The definition of "public record" in KRS 61.870(2) should be amended to make explicit that communications about public business on privately owned devices and accounts are public records subject to retention and disclosure. The laws' references to ASCII, fax transmission, and other dated technologies should be modernized, and requesters should be permitted to use their own scanning devices where doing so will not damage records. Penalties for willful violations should be meaningfully increased; prevailing complainants whose victories before the attorney general are then appealed by agencies to circuit court should be made whole through mandatory attorneys' fees and costs. Finally, training should be extended to all state and local officials and implemented through a mandatory online module with an assessment component certifying actual comprehension — with penalties for noncompliance. Taken together, these reforms would honor rather than dilute the General Assembly's foundational commitment to open, transparent, and accountable government, ensuring that Kentucky's sunshine laws can do in the 21st century what they were designed to do in the 20th: keep the public's business in public view. [Shining-the-Light-on-Ky’s-Sunshine-Laws.-BensenhaverA Proposal for Legislative Revision to Kentucky’s Open Meetings and Open Records LawsBIPPS-Policy-Report.-Shining-the-Light-on-Ky’s-Sunshine-Laws.-Bensenhaver.pdf460 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2026/05/BIPPS-Policy-Report.-Shining-the-Light-on-Ky---s-Sunshine-Laws.-Bensenhaver.pdf "Download") ### Bang for the Buck (2012) URL: https://www.bluegrassinstitute.org/bang-for-the-buck-2012/ Last updated: 2025-10-22T14:49:57.000Z [Bang for the Buck (2012)Bang\_for\_the\_Buck\_2012.pdf613 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2025/10/Bang%5Ffor%5Fthe%5FBuck%5F2012.pdf "Download") This report examines Kentucky's education efficiency by detailing the relationship between spending and academic achievement across school districts. “Bang for the Buck” finds that despite nearly doubling real education spending since the 1990 Kentucky Education Reform Act (from $2.1 billion to $4 billion in inflation-adjusted dollars), the state's education system shows troubling inefficiencies. The bright spots are four “Diamond in the Rough” districts (Graves County, Eminence Independent, LaRue County, and Mason County) where students achieve above-average academic performance and graduation rates despite having poverty levels at or above the state average of 56% and receiving below-average per-pupil funding. Some other highlights: - **Kentucky's education funding has nearly doubled since 1990 with minimal efficiency improvements:** Real spending on public education increased 194% between 1989-2010 in inflation-adjusted dollars, yet the MUNIS financial accounting system remains so flawed after 6 years of promised fixes that accurate school-level efficiency analysis is impossible. - **"Diamond in the Rough" districts prove high poverty doesn't excuse poor performance:** Four districts (Graves County, Eminence Independent, LaRue County, Mason County) achieve above-average ACT scores and graduation rates despite having poverty rates at or above the state average of 56% AND receiving below-average per-pupil funding. - **More spending correlates with *lower* test scores in Kentucky:** The analysis found a negative correlation (-0.29) between district spending and ACT scores, indicating that districts spending more per pupil actually tend to produce lower academic achievement, directly contradicting the assumption that more money automatically improves outcomes. The analysis demonstrates that Kentucky's constitutional mandate for an "efficient" education system remains unfulfilled, as more spending has not translated into better outcomes, and the state urgently needs to repair its financial tracking systems to identify which specific educational programs and practices deliver the best results for taxpayer dollars. [Bang for the Buck (2012)Bang\_for\_the\_Buck\_2012.pdf613 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2025/10/Bang%5Ffor%5Fthe%5FBuck%5F2012.pdf "Download") ### On Fairness and Needs in a Free Enterprise Economy URL: https://www.bluegrassinstitute.org/on-fairness-and-needs-in-a-free-enterprise-economy/ Last updated: 2026-03-23T19:04:32.000Z [garen-fairness-market-economyThe private sector is broader than the textbook model suggests.garen-fairness-market-economy.pdf269 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2026/03/garen-fairness-market-economy.pdf "Download") In "On Fairness and Needs in a Free Enterprise Economy," University of Kentucky economist John Garen challenges the widespread assumption that free enterprise fails to allocate resources according to need, arguing instead that the private sector — far broader than just profit-seeking firms — is surprisingly well-equipped to do so. Garen shows that nonprofits, charities, churches, families, and civic organizations routinely allocate goods and services based on need through close, face-to-face relationships and nonmonetary quid pro quos, which can be modeled using a modified supply-and-demand framework. By contrast, government programs face structural disadvantages — namely, the inability to assess true need intimately, the absence of meaningful quid pro quos, and a lack of competitive pressure — that lead to dependency, crowding out of private charity, and expanding budgetary commitments over time. **Main Takeaways** - **The private sector is broader than the textbook model suggests.** Free enterprise encompasses not only profit-maximizing firms but also a rich ecosystem of nonprofits, churches, families, and community organizations that voluntarily and effectively allocate resources according to need — without government mandate. - **Intimate relationships and nonmonetary exchange are the keys to need-based allocation.** Private organizations succeed where government programs struggle because they use close personal interactions to assess genuine need, screen out moral hazard, and impose nonmonetary conditions (quid pro quos) on recipients — mechanisms that public bureaucracies are structurally ill-suited to replicate. - **Government assistance programs carry hidden long-run costs.** By effectively lowering the nonmonetary price of receiving benefits, government programs increase dependency, crowd out private charitable provision, and expand budgetary commitments — effects that are small and politically painless in the short run but grow substantially over time, making the programs difficult to reform or eliminate. **Conclusion** Garen's paper makes a compelling case for reassessing both the capabilities of the private sector and the limitations of government when it comes to fairness and need. Rather than viewing free enterprise as inherently indifferent to the less fortunate, he demonstrates that voluntary, community-based organizations have long been doing the very work that critics claim only government can do — and often doing it more effectively. The paper serves as a useful corrective to an oversimplified debate, reminding policymakers and citizens alike that well-intentioned government programs can undermine the very private institutions that address human needs most directly, while creating dependency that compounds over time. The takeaway is not that government has no role, but that its comparative disadvantages in assessing need and enforcing accountability deserve far greater scrutiny than they typically receive. ### What Tests Do College Presidents and Public School Principals Like? URL: https://www.bluegrassinstitute.org/what-tests-do-college-presidents-and-public-school-principals-like/ Last updated: 2025-09-09T12:49:27.000Z Some interesting comments were made in yesterday’s Elementary and Secondary Education Subcommittee meeting in Frankfort. Dr. Wayne Andrews, the president of Morehead State University, discussed the inadequate preparation of many Morehead freshmen. He said about 40 percent of each new class requires remediation in at least one subject, usually math. To combat this problem, Morehead started a cooperative program with public schools called the College Algebra Program. What is particularly interesting is the way Morehead measures the success of students that complete it. Morehead isn’t using the state’s CATS for this. Instead, they use the ACT college entrance test. Other comments came from Tim Bobrowski, principal of Sebastian Middle School in Breathitt County. Bobrowski is very favorably impressed with the EXPLORE test, also created by ACT, Incorporated. He pointed out that EXPLORE shows kids where they stand in eighth grade, soon enough to give students a chance to repair some of their deficiencies. Why is this interesting? During and after the debate on [Senate Bill 1](http://www.kentuckyvotes.org/2008-SB-1?ref=bluegrassinstitute.org) from this year’s regular session, a rather concerted attack on these ACT created tests was launched by a group the Paducah Sun has dubbed the “KERA Amen Chorus.” The misguided crowd in the “Chorus” issued several papers attacking the validity of the ACT’s tests for eighth and tenth graders while taking swipes at the ACT college entrance test, as well. Among other things, it looks like the “Chorus” covets the money spent on these ACT tests and would prefer us to dump all of that cash into their beloved, though already bloated, CATS assessments, instead. What was reiterated yesterday is that many don’t sing along with the “Chorus.” At least one practicing public school educator does not agree. At least one college in the state knows where to go when it needs to evaluate math preparation for college, as well, and that isn’t to the state’s home-grown CATS assessment, either. And, since school principals and college presidents are on the leading edge of dealing with the real issues in KERA, we probably need to give those folks more credence in preference to a group of ideologues who just seem to be singing off-tune. ### More Homework for the CATS Task Force URL: https://www.bluegrassinstitute.org/more-homework-for-the-cats-task-force/ Last updated: 2025-09-07T21:45:14.000Z Here are some thoughts on mathematics for the CATS Task Force recently named by Kentucky Commissioner of Education Jon Draud. “Standards need to focus on a small enough number of topics so that teachers can spend months, not days, on them.” “…one illustration: in the early grades, top-achieving countries usually cover about four to six topics related to basic numeracy, measurement, and arithmetic operations. That's all. In contrast, in the U.S., state and district standards, as well as textbooks, often cram 20 topics into the first and second grades. That's much more than any child could possibly absorb.” “…why do we have such unfocused, undemanding, and incoherent math standards? I attribute it to the long tradition in the U.S. of shared responsibility in curriculum decision-making, as well as a complex decentralized arrangement for schooling and curriculum development.” “On the math portion of the 2003 Trends in International Mathematics and Science Study, just seven percent of fourth- and eighth-graders in the U.S. attained the advanced level; in comparison, in Singapore (the top achieving nation), 38 percent of fourth-graders and 45 percent of eighth-graders attained the advanced level….” “…the virtual absence of input from the academy (i.e., university professors and research mathematicians), make(s) defining the sequence of topics an exercise in democratic consensus making. Unfortunately, standards setting in the U.S. is more conducive to politically motivated, ad hoc approaches to content than to discipline-based ones.” Truth time – I didn’t write these comments. Professor William H. Schmidt from Michigan State University did. Now, here’s a surprise. He didn’t publish this in the Bluegrass Institute’s Web site. His thoughts are found in the [American Federation of Teachers’ “American Educator” for Spring 2008.](http://www.aft.org/pubs-reports/american%5Feducator/issues/spring2008/schmidt.htm?ref=bluegrassinstitute.org) AFT is the “other” teachers union we don’t hear much about in Kentucky. Maybe that’s too bad. It seems they pay some attention to improving the art and science of teaching rather than just constantly haranguing us for more money and better benefits. Anyway, Task Force members, get reading! ![](https://blogger.googleusercontent.com/tracker/4468664660833170893-4271278680579683440?l=bluegrasspolicy-blog.blogspot.com) ### Unbridled Pork: The Book Frankfort Doesn't Want You to Read URL: https://www.bluegrassinstitute.org/unbridled-pork-the-book-frankfort-doesnt-want-you-to-read/ Last updated: 2026-01-20T17:52:21.000Z This joint report from the Bluegrass Institute and Citizens Against Government Waste examined wasteful spending in Kentucky state government during the 2004-2006 budget period. The report identified systemic overspending as the root cause of Kentucky's fiscal challenges, documenting examples ranging from subsidized convention centers and shrimp farming to generous state employee benefits and inefficient merit-system protections. [Kentucky: Unbridled PorkA joint project of the Bluegrass Institute and Citizens Against Government Waste2006-kentucky.pdf656 KBdownload-circle](https://www.bluegrassinstitute.org/content/files/2026/01/2006-kentucky.pdf "Download") Key findings included $12 million in state bonds for a convention center in Corbin (population 8,111), $2.8 million for shrimp farming research in a landlocked state, $87 million in biennial subsidies for money-losing state parks, and an estimated 10-15% cost premium on public construction due to prevailing wage requirements. The report also highlighted Kentucky's comparatively high rate of government employment (17% versus under 15% in neighboring states) and the structural protections that make state workforce reductions difficult. The authors called for establishing a Kentucky "Grace Commission" to identify waste, adopting constitutional tax-and-expenditure limits, and privatizing operations where private contractors had demonstrated cost savings. Key takeaways: **1\. Local Projects Funded with Statewide Tax Dollars** The report documented millions in state appropriations for projects serving narrow constituencies—convention centers, library expansions, and county fairgrounds—arguing these should be locally financed to ensure accountability and appropriate prioritization. **2\. Structural Barriers to Efficiency** Kentucky's merit employment system guaranteed 5% annual raises regardless of performance and required displaced employees receive comparable positions, while prevailing wage laws added an estimated 10-15% to public construction costs. These structural features limited the state's ability to achieve private-sector efficiency gains. **3\. Privatization as a Cost-Control Tool** Privately operated prisons in Lee and Marion counties achieved lower per-inmate costs than state-run facilities, with Marion County's $32/day representing the lowest rate in Kentucky. The report argued this model should extend to state parks and other operations where government had demonstrated persistent deficits. ### Placeholder URL: https://www.bluegrassinstitute.org/placeholder/ Last updated: 2025-09-08T21:17:55.000Z There is no content on this page.