STATE: KY’S automotive industry has an economic impact of more than $14B, supports 136,500 jobs
A study of the fiscal and economic impact of Kentucky’s automotive industry shows that the sector supports 136,500 jobs and contributes $14.3 billion to Kentucky’s gross state product (GSP). In other words, $1 of every $13 in the state’s economy is tied to the automotive industry and roughly one out of every 18 jobs in the state is supported by the direct, indirect or induced effects of automotive-related manufacturers.
The study, conducted by researchers at the University of Louisville Urban Studies Institute, took nearly six months to complete and is the first in-depth study into the economic impact the industry has on Kentucky’s economy. The study was commissioned by the Kentucky Automotive Industry Association (KAIA), an organization formed last year to address the industry’s challenges and opportunities for growth.
“Kentucky’s automotive industry is more than Ford’s assembly plants in Louisville. More than GM’s Corvette plant in Bowling Green. And more than the Toyota and Lexus operations in Georgetown,” said Gov. Steve Beshear. “This vital industry includes regional parts suppliers, tool-and-die shops, warehouses, trucking companies and metal-stamping operations throughout the commonwealth.”
STATE: Kentucky Raises state workers’ hourly minimum wage to $10.10
Gov. Steve Beshear announced in June that effective July 1, the minimum wage for Kentucky’s state workers would increase from $7.25 per hour to $10.10 per hour.
The new policy affects nearly 800 state employees. Of the 510 employees who previously made less than $10.10 per hour, more than a third are employed by the Kentucky Department of Veterans Affairs and another 90 work in behavioral health agencies.
The policy change does not apply to state employees who earn tips, such as restaurant servers, but that minimum is also being increased to $4.90 per hour. The previous hourly rate was $2.19 per hour.
The new policy also requires private companies that have service contracts with state government pay a minimum wage of at least $10.10 per hour to those employees who perform work on or in connection with those government contracts. The requirement will be added to contracts as they come up for renewal.
“When people work hard at a full-time job, they should have enough money to live on. Right now, at minimum wage, they don’t. That’s unacceptable,” Beshear said. “A raise of less than $3 per hour may be enough for some employees to move off government assistance programs. That empowers workers and lowers costs for taxpayers. Kentucky businesses should follow the example we’re setting as the state’s largest employer and raise the minimum wage for their workers.”
Raising wages will cost about $1.6 million. Beshear said less than $800,000 of the cost will come from General Fund dollars but did not identify where the remainder would come from.
STATE: Apprentice-style job training KY Fame adds two more chapters
The Kentucky Federation for Advanced Manufacturing Education (KY FAME), the state’s nationally recognized workforce training program, has added new chapters in Owensboro and the Cumberlands region, which includes 13 counties in southeastern Kentucky.
KY FAME is a partnership of manufacturers that have teamed up to address the shortage of technically skilled workers needed in advanced manufacturing. The program offers apprentice-style education and training designed to create a highly skilled workforce that meets the needs of Kentucky manufacturers.
KY FAME student participants will enroll in the advanced manufacturing technician (AMT) program, attending classes two days per week at Owensboro Community & Technical College or Somerset Community College and working an additional 24 hours per week for a sponsoring employer. Upon completion of the program, students receive an associate degree in applied sciences and most begin full-time employment with the sponsor.
Created in 2010, KY FAME now includes 80 companies statewide. The new chapters represent the fifth and sixth locations in Kentucky, with others located in central Kentucky, Louisville, Northern Kentucky and Elizabethtown. More than 40 students have completed the AMT program, 60 students are currently enrolled and more than 200 students will begin classes in fall 2015.
STATE: Beshear forms work group to study teacher retirement funding
left the Kentucky Teachers’ Retirement System with
a $14 billion shortfall.
Gov. Steve Beshear has ordered the formation of a 23-member work group to develop a plan to strengthen the solvency of the Kentucky Teachers’ Retirement System. The group will consist of policy and education leaders.
According to the system’s 2014 actuarial valuation, there is a $14 billion unfunded liability and a 53.6 percent funding status. In 2000, the system had $571 million in unfunded liability and a 95.7 percent funding status.
“Our teachers are the foundation of our educational system for the future of our children and grandchildren,” Beshear said. “We must assure that the Kentucky Teachers’ Retirement System is able to fully honor our commitments to our teachers and those who retired from teaching. Today I’m asking a group of experts to find ways to ensure the future of the KTRS.”
The Kentucky Teachers’ Retirement System Funding Work Group, led by former state senator and former State Board of Education Chairman David Karem, will meet over the coming months to develop recommendations to resolve the funding shortfall and stabilize and secure funding for a system that serves over 75,000 active members and more than 45,000 retired members.
The work group will review best practices in other states regarding pension benefits, conduct a comprehensive review of funding options and make recommendations for improving the fiscal solvency of the KTRS. The work group may also contract for consulting services.
Beshear is asking the work group to complete its work and submit its report to him on or before Dec. 1, 2015.
STATE: Kentucky’s new incentive law draws 3 film projects to the state
Just weeks after Gov. Steve Beshear signed a new law approving financial incentives for film companies that choose to film in the Bluegrass state, three projects have been approved for those incentives by the Kentucky Tourism Development Finance Authority.
Under the new law, approved film and television projects completed in Kentucky are eligible for up to a 30 percent tax rebate. Additional rebates are also possible for projects that use Kentucky labor and film in certain counties.
The projects approved include:
• A feature film called “Permanent” by Permanent Pictures LLC that is expected to be filmed this year. The company will spend about $800,000 in Kentucky.
• A feature film called “The Ultimate Legacy” by ReelWorks Studios LLC that will be filmed in Kentucky this year with a projected Kentucky budget of $1.25 million.
• A televised sports program called “Pro Football Focus Weekly Report” to be filmed in Northern Kentucky for NBC Sports. The production company estimates $1 million to $2 million will be spent in Kentucky. Former NFL player and broadcaster Chris Collinsworth is the owner of the production.
STATE: Kentucky earns national recognition for job creation
Area Development magazine, a leading economic development trade publication, has recognized Kentucky with a Silver Shovel Award, recognizing the commonwealth as one of the most successful states in creating jobs and securing investments in 2014.
In the summer 2015 issue, Area Development magazine awarded Silver Shovels in four population categories, with Kentucky’s honor coming in the 3-to-5 million population tier. The awards are based on a state’s top 10 job-creation and investment projects that began to materialize in the previous year. Kentucky’s top projects resulted in nearly 4,000 new and retained jobs and more than $1 billion in investments.
In 2014, companies announced the most business investment in the commonwealth since the state began tracking that information nearly 30 years ago. In March, the commonwealth earned Site Selection magazine’s Governor’s Cup award for the most economic development projects per capita in 2014.
The projects that made Kentucky a winner with Area Development include:
• Aleris Rolled Products (Lewisport): 743 retained jobs, $350 million investment
• Champion Petfoods (Auburn): 147 jobs, $85.3 million investment
• Diageo Americas Supply (Bagdad): 31 jobs, $115 million investment
• eBay (Walton): 354 jobs, $52 million investment
• Faurecia Seating (Simpsonville): 410 jobs, $18.8 million investment
• Ford Motor Co. (Louisville): 650 jobs, $209 million investment
• Kindred Healthcare (Louisville): 400 jobs, $35.7 million investment
• Metalsa (Elizabethtown): 247 jobs, $70.4 million investment
• Quiver Ventures (Bowling Green): 80 jobs, $155.9 million investment
• TPUSA Inc. (Louisville): 750 jobs, $13.3 million investment
GLASGOW: D&B Trucks & Equipment gears up To expand, will add 50 jobs
D&B Trucks and Equipment Sales is expanding its operations in Glasgow and plans to add 50 new jobs to support the expansion.
D & B purchases old or wrecked semi-trucks, deconstructs them to the framing and re-assembles them on a new chassis and shell with rebuilt engines, transmissions and clutches. The gliders are also customized with more user-friendly components than brand new trucks, which give them a competitive edge.
Increased demand for its products has led to the company’s plans to add 9,600 s.f. to its existing 15,440-s.f. facility. The expansion, which will be completed this fall, will allow the company to more than double its monthly production.
D&B opened 14 years ago, selling forestry equipment. The company now has 29 employees and offers a lineup of new and used trucks and trailers in addition to forestry and construction equipment.
LAWRENCE BURG: Four roses distillery pours $55m into expansion projects
Four Roses Distillery is investing $34 million to add two new buildings and more equipment at its distillery in Anderson County. The expansion will double the size of the distillery and annual production, and will create 15 new jobs.
The company is also investing another $21 million to build four new warehouses in nearby Cox’s Creek, Ky., and will add five more jobs there.
The Anderson County buildings are slated to be complete in 2018, while the Cox’s Creek warehouses will be operational by 2022.
“This is another win for our signature bourbon industry and for all of Kentucky,” said Gov. Steve Beshear. “To see Four Roses double its production and plan expansions at two locations is further proof that bourbon is more popular than ever. We expect the world’s taste for Kentucky’s native spirit will remain strong for years to come.”
The latest expansion plans come on the heels of Four Roses’ announcement this past spring to build a new 60,000-s.f. facility in Bullitt County that will house two bottling lines, bottling support areas and office space. That facility is expected to be operational by the spring of 2018.
Lexington: Rapid growth of digital textbooks brings jobs to etech
ETechCampus, a Lexington-based company that specializes in digital learning solutions for schools, colleges, corporations and government entities, is investing $2 million to expand its operations in Lexington and plans to add 45 new jobs to support that growth.
In order to meet the demand being created by the rapid adoption of digital learning initiatives, eTech is moving to a new location that is expected to be operational this fall. eTech plans to hire designers, account managers, engineers and sales and marketing specialists to work with its growing clientele.
eTechCampus was founded by Lexington-based
eCampus.com, which provides a complete outsourced virtual bookstore for educational institutions looking to transition out of brick-and-mortar campus bookstores. eTech’s approach enables institutions to make the transition to a digital learning environment by offering training, virtual bookstore services, etextbook solutions, online course design and a learning management system called Converge.
LEXINGTON / LOUISVILLE: American Founders Bank sold to 2 different companies, HQ moves to Louisville
Lexington-based American Founders Bank Inc. is being sold to two different companies, one of which plans to move the bank’s headquarters from Lexington to Louisville.
The bank’s three Lexington branches are being sold to City National Bank of West Virginia, while William P. Butler is acquiring the remaining two branches in Louisville and plans to move American Founders’ headquarters to Louisville.
Butler is the founder and chairman of Covington-based Corporex Companies, a diversified commercial real estate developer with a 50-year history, a national footprint and assets in excess of $1 billion.
“When I began my business in the late 1960s, I built many buildings in Louisville and developed the ‘Ole Brickyard Park’ on Bishop Lane,” Butler said. “I love Louisville and have many fond memories of successful relationships there. I am excited with the prospect to return and be a part of the community once again.”
Barry Brauch, AFB’s CEO, will relocate from Lexington to Louisville. Trish Osborn, currently AFB’s Louisville market president, will be promoted to chief banking officer.
City National’s acquisition of AFB’s Lexington branches expands its presence to 11 branches in Kentucky, in addition to 74 branches in West Virginia, Virginia and Ohio.
As of March 15, 2015, AFB’s Lexington branches had deposits of $164.2 million. City National will also acquire $125 million in performing loans as part of the transaction. AFB President Bill Craycraft will serve as City National’s market president in Lexington.
PIKEVILLE: Appalachian air service to Nashville ends after nine months
Appalachian Air is ending its commercial flight service between Pike County Regional Airport and Nashville this month, less than a year after it launched.
According to a statement issued by L.B. Schmidt & Associates, the consulting company that has been promoting the service, Appalachian Air was never able to build a strong enough customer base to make the service sustainable, despite aggressive promotional pricing and nearly 100 percent operational reliability. Luke B. Schmidt, president of Schmidt & Associates, said the region’s loss of nearly 12,000 coal-mining jobs had a significant impact on the airline’s ability to attract enough passengers.
Appalachian Air began flying between Pikeville and Nashville last October, with daily morning departures out of Pikeville and daily afternoon departures out of Nashville.
RICHMOND: Merger with Flemingsburg firm grows baldwin CPAS footprint
Richmond-based accounting firm Baldwin CPAS has merged with Eldridge, Jackson & Leedy, a professional services firm located in Flemingsburg, Ky.
The combined firm is retaining the Baldwin CPAs name and will maintain offices in Richmond, Flemingsburg, Louisville, Maysville and Lexington.
The merger adds 11 employees – including three partners – to Baldwin CPAs for a total of 39 Baldwin employees.
Baldwin CPAs’ services include accounting for businesses and individuals, bookkeeping and payroll, tax planning and preparation, audits, business valuations, certified fraud examinations, forensic accounting and litigation services, employee benefit plan audits and wealth services.
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