Kentucky Surplus Amid Tax Cuts | Lexington News

Lexington News Today | 2 Min News | The Daily News Now! · Jul 10, 2026 · 1m

Kentucky just shattered records with its seventh straight budget surplus—bringing in 1.7% more than projected for FY2026—opening the door to restoring slashed programs. Despite a $31 billion budget spanning 2026-2028, the state slashed agency funding to stay solvent. Meanwhile, income taxes keep falling: the individual rate dropped from 5% to 3.5% starting January 2026, creating a tricky financial tightrope. The current budget prioritizes K-12, public safety, healthcare, and essential services, plus a 2% annual raise for state workers. Medicaid gets a major boost, with funds earmarked for…