FRANKFORT, Ky. (Aug. 13, 2015) – Economic growth in Kentucky should hit by 3.2 percent in fiscal year 2016, which began in July, and create a $219 million state budget surplus, according to the Concensus Forecasting Group, a panel of economic experts that advises state government financial planners.
During its meeting today, the panel also forecast economic growth for the following two fiscal years as well: 2.7 percent for the 12 months of July 2016 through June 2017, and 2.8 percent in Fiscal Year 2018.
Gov. Steve Beshear issued a statement on what he called “good news” and took credit in advance for handing off a Kentucky economy and state budget to his successor, who will be elected in November, that will be much improved from the conditions he presided over after coming into office in late 2007.
“Kentucky’s economic outlook got more good news today from the Consensus Forecasting Group who approved a planning forecast that predicts another budget surplus at the end of the current fiscal year and sustainable growth for the next several years,” Beshear’s statement said. “This comes on the heels of us depositing $82.5 million in the state’s savings account thanks to excess revenues in fiscal year 2015. This economic forecast is more tangible evidence of the impact of the improving economy.
“We have worked tirelessly with lawmakers and business leaders to get to this point by making Kentucky more competitive and business-friendly. With the state’s unemployment rate at 5.1 percent, the lowest since 2001, the job market continues to improve. We have steadily grown our economy, being the top state last year for economic development projects per capita, and we protected our Kentucky families by meeting Unemployment Insurance benefit obligations during the Great Recession. On Monday we paid off our $972 million federal Unemployment Insurance loan two years ahead of schedule that gave us a safety net for our out-of-work Kentuckians during the recession. Now Kentucky employers will save approximately $165 million in federal UI taxes.”
Beshear’s administration has included the depths of the Great Recession and its aftermath. He has had to make seven or eight midyear budget cuts to keep the biennial budgets enacted the General Assembly in balance during his nearly two terms in office.
“The Commonwealth still has challenges, and we will continue to be aggressive to strengthen the economy, build a stronger workforce, advance education programs and offer affordable, quality, comprehensive health care to all Kentuckians. Today’s prediction from this independent group of economists is undisputed evidence that Kentucky’s economy is rapidly improving and our strong fiscal management has reaped benefits for future generations,” he said.
“The work of the Consensus Forecast Group is critically important as our next Governor and the 2016 General Assembly consider the upcoming biennial budget. We are leaving the state’s finances in much better shape than what I was presented with my first year in office. I would encourage our leaders to build on our economic successes.”