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10/28/2011With Kentucky being one of the United States’ top producers of cars and light trucks, we talk a lot about the impact of our four major manufacturing plants, not just on their local communities but also on parts manufacturers and suppliers around the state.
During an event touting the Ford Motor Co.’s new investment in Louisville on Thursday, I heard a number that puts that spin-off in perspective.
$3.8 billion.
That’s the value of parts and other goods that Ford will buy this year from more than 180 suppliers in Kentucky (actually, Ford Vice President John Fleming said “more than $3.8 billion”).
That’s a lot of parts, creating economic impact throughout the state.
That’s one of the many reasons I have been so thrilled by Ford’s ongoing investment in its Louisville Assembly Plant and its Kentucky Truck Plant in Jefferson County.
If you recall, with the car industry facing huge challenges during the recession, the future of those plants was in doubt. But I as governor and then-Louisville Mayor Jerry Abramson put in long hours on the phone and even flying to Michigan to convince Ford to stay in Louisville and Kentucky.
The company’s decision in 2008 to retool the plants saved about 5,000 jobs.
Ford strengthened its commitment last year when it announced it would invest $600 million to retool LAP to build the next-generation Ford Escape, and add in the process add 1,800 workers.
On Thursday, Ford executives came in to see those changes and to confirm additional news: a planned $621 million investment in the truck plant over the next four years, and the likely addition of a third shift toward the end of next year at LAP, totaling about 1,300 new workers.
In one year, that’s more than $1.2 billion in new investment, and 3,100 new jobs.
I am proud of the efforts of myself and others – including former Mayor Abramson and Sec. Larry Hayes and other members of the state Cabinet for Economic Development – to work with Ford to negotiate the investments and to set up incentives to help make the expansions successful.
I also want to acknowledge the efforts of UAW leaders and members who worked with Ford management to write and approve a new contract.
As a result, our economy benefits, the community benefits, the company benefits and our families benefit.
9/30/2011Relief is in sight for Kentuckians and Kentucky businesses whose daily routine and operations has been affected by the closure of the Sherman Minton Bridge in Louisville.
Today I joined with Indiana Gov. Mitch Daniels and federal highway officials to announce an aggressive plan to repair the bridge and get it reopened within the next six months.
The bridge – which carries Interstate 64 from Louisville to New Albany, Ind., was closed Sept. 9 after a serious crack was discovered in a steel tie. Three weeks of inspection and analysis found other weld defects at numerous locations.
The $20 million repair will involve installing new steel plating along both sides of the bridge tie that runs horizontally along the entire 1,600-foot structure.
Indiana has lead responsibility for maintenance of the bridge and will issue bid documents next Tuesday and, hopefully, the contract by mid-October.
Because we hope to get the bridge opened even quicker without sacrificing safety, an incentive will be built into the contract if work is finished before the target completion date. Likewise, sanctions will punish undue delays.
Federal Highway Administrator Victor Mendez has personally pledged to me to expedite the necessary federal reviews of the project, and I appreciate that.
I also appreciate the patience of people whose lives have been affected by the shutdown.
No doubt this has caused and continues to cause massive headaches.
But I have seen many examples of the creativity and resilience of our people and our businesses as they have sought to go about their lives.
• Businesses letting employees telecommute.
• Workers car-pooling.
• New production schedules.
• Different delivery times.
• Professors at the University of Louisville sleeping in their offices.
• A new ferry.
• Families who are temporarily split apart, living on both sides of the river to ease trips to work, school and elsewhere.
• And above all, patience and good humor while stuck in traffic.
I appreciate those attitudes and those responses.
We have dealt with a lot in Kentucky over the last few years, from economic challenges to a seemingly endless series of weather-caused catastrophes. The deterioration of this bridge is the latest challenge, and we will overcome this as we have and are overcoming the other challenges.
It hasn’t been easy, but today we set out a path forward.
In the weeks and months ahead we will be working as quickly as possible to implement that plan, safely and efficiently.
9/1/2011More than 90 percent of Kentucky businesses have fewer than 50 employees, so when we talk about job creation and growing the economy – especially cutting-edge, high-tech jobs – many times we’re talking about small businesses.
Unfortunately, many small businesses can’t obtain the capital to put creative ideas into action.
They’re credit-worthy. But in this era of caution, many lie just outside of the guidelines of private sector lenders.
This week, however, we announced a major new initiative that will give Kentucky entrepreneurs and small businesses access to nearly $155 million to help with job creation across this state.
The Kentucky Small Business Credit Initiative includes three new programs to be used by the Cabinet for Economic Development to facilitate private lending to small businesses.
• The Kentucky Capital Access Program will encourage private lenders to be more aggressive in loan practices by offering them additional insurance against potential loss.
• The Kentucky Collateral Support Program will help borrowers whose cash flow does not meet lenders’ requirements.
• And the Kentucky Loan Participation Program will enhance a lender’s ability to underwrite a loan.
The increased access to capital was made possible by the Small Business Jobs Act of 2010.
Kentucky successfully applied for just under $15.5 million from the U.S. Department of Treasury, and that money will be leveraged 10-1 with private lender funds to generate almost $155 million.
The program continues our aggressive outreach to small businesses with programs and services designed to help them in this difficult economy. These include:
• Creating the Kentucky Small Business Investment Credit.
• Expanding the Kentucky Micro Enterprise Loan Program.
• Creating the Governor’s Export Initiative to foster international trade relationships.
• Developing a One-Stop Business Portal to streamline interaction with state agencies.
• And using state money to match dollar for dollar the grants issued through two federal programs that nurture technology and innovation at our small businesses. v
We’re the only state that does this, and we just completed our 11th round of funding, matching 112 grants to 56 companies.
• We’ve also held numerous forums and seminars focusing on helping people start new businesses. And last year we responded to over 5,000 inquiries from entrepreneurs requesting help with starting or expanding a business.
8/31/2011Bulldozers are running full-throttle at the Kentucky Speedway near Sparta as a new plan to improve parking at the track is being put into place in time for the second running of the Quaker State 400 next June 30.
I joined Speedway officials and others from state government earlier this week to announce the plan, which is designed to solve the backups that kept some fans from getting into the NASCAR’s inaugural Sprint Cup Series race last July.
The Speedway has bought 143 acres across from the track and is turning it into about 10,000 parking spaces. The track is also hiring parking and engineering professionals to manage both car and pedestrian traffic next year.
We appreciate the track’s demonstrated commitment to improving the fans’ experience, and consequently, the state is stepping up to make some changes that will help:
• One, widening the shoulder of the ramp from southbound 71 to Ky. 35 to allow three lanes of traffic to exit the interstate on race day.
• Two, widening about a mile of Ky. 35 leading up to the track, making it a five-lane road with full-width shoulders.
• And three, adding a tunnel under Ky. 35 to help pedestrians move more safely to and from the Speedway.
The improvements will help not only race days at the track – which is a significant part of Kentucky’s tourist economy and has a huge economic impact on our local businesses – but also residents and businesses of Gallatin County.
The cost is about $3.6 million and will be paid out of the Transportation Cabinet’s contingency fund.
The plan is the culmination of a series of meetings we initiated with the track after the July race.
The bottom line is this event is extremely important to this state. We worked hard to attract the race to Kentucky, and we intend to help the Speedway make it a bigger and better event every year.
8/26/2011Whether it’s a 20/20 news show or a made-for-TV movie, too often the face of our state is that of a person missing a mouthful of teeth.
It’s an unfair stereotype, but there’s little doubt Kentucky has a serious problem with dental health.
Two years ago we began an aggressive effort to reverse that trend. Last week we unveiled another step, one that could change the lives of 25,000 children.
The impact of poor oral health – especially for our children -- is much greater than an unflattering national image.
Dental problems affect everything from nutritional choices to speech development to performance in school. Children with chronic pain in their mouths find it difficult to do well in school, especially if they have to miss class. And poor oral health can lead to more serious health conditions.
The new program is called “Smiling Schools,” and it has three parts:
• One, over the next year a protective tooth varnish treatment will be applied to the teeth of children in first through fifth grade at 80 schools in 16 counties in Eastern Kentucky. The fluoride varnish prevents decay, slows the progress of existing decay and reverses the beginning steps of decay.
• Two, the Department for Public Health will conduct outreach in that region to increase public awareness of the importance of children’s dental health.
• And three, the local health department nurses specially trained to apply the varnish will examine the children for other dental problems and refer those who need additional services to dentists.
It’s a one-year pilot program funded from two sources: $250,000 from the state General Fund, and $1 million from the federal Appalachian Regional Commission, via a grant to the Kentucky Department for Public Health.
A similar program is in its fourth year in Clark County, and it has produced incredible results.
The new program is part of the “Healthy Smiles Kentucky” initiative I kicked off in October 2009.
The biggest goal was to increase the number of dentists who treat children. With a variety of partners from the dental colleges at the University of Kentucky and University of Louisville, the state’s Oral Health Program is developing new training in pediatric dentistry that should be available later this year.
In addition, last year we awarded grants that helped many communities establish local coalitions that have been increasing access to dental care through new programs tailored to those communities.
Next year those coalitions will be able to apply for portable dental equipment to bring care directly into those communities.
The way I and many others see it, an investment in dental care is an investment not only in the quality of life of our individual children but also in the long-term economic success of this state.
8/4/2011My time visiting Kentucky soldiers in the Middle East continues to be a moving experience.
One of the most interesting stories – and most unique missions – involving American troops in Afghanistan surrounds the AgriBusiness Development Teams.
These are hand-picked soldiers who are teaching sustainable agricultural practices – both how to farm and how to turn it into a successful business -- to villagers in remote areas.
Sort of like battle-ready agricultural extension agents working toward peace in a country long torn by violence, these farmer-soldiers have also been very successful with empowering Afghani women in the agricultural economy – a new phenomenon in that region.
I got to spend time with Kentucky’s third ADT stationed in Afghanistan – a Kentucky National Guard Unit headed by Col. Neil Mullaney – today while visiting troops in the Middle East.
It’s the third day of a trip set up and funded by the Department of Defense for governors of states where a large number of troops live or are based.
It’s the first time in recent history that a sitting Kentucky governor has visited an active war zone.
Today I visited troops in Kabul, Kandahar and Bagram.
In addition to visiting the ADT, I got to spend time with several dozen soldiers from the 101st Airborne based at Fort Campbell.
My admiration for the job our Kentucky soldiers are doing in these difficult geographic, social, and political circumstances continues to grow.
I’m amazed at their enthusiasm and confidence. They really feel they are making a big difference in the region, bringing peace and security – not to mention economic progress.
I assured the soldiers that all of Kentucky is thinking about them and praying for their safe return. They in turn asked me to send their love back to their families and communities.
We took a lot of pictures around a Kentucky flag, and they talked a lot about the coming football game between the University of Kentucky and University of Louisville. In fact, they took a poll on who they think will win the game (but made me vow not to tell).
All told, more than 9,600 Kentucky troops are currently deployed in Afghanistan. Approximately 6,000 troops are from Fort Campbell, 3,600 from Fort Knox and 79 from the Kentucky National Guard.
Earlier this week I visited troops stationed in Iraq and Kuwait, eating and talking with them.
Combined with the troops deployed in Iraq and Kuwait, Kentucky currently has more than 12,000 servicemen and women serving in these war zones.
All of Kentucky should be proud of them.
I’m privileged to have seen their dedication, their professionalism and their courage in person.
8/3/2011One of the first things that struck me on my visit to the Middle East was the heat.
125 degrees.
Searing.
Just in case of attack, I was issued body armor and a Kevlar helmet to wear on flights in-country.
What I was seeing and feeling was just another normal “work day” for our Kentucky men and women deployed overseas in the war on terror.
And my respect and admiration – no, my awe -- of their courage and their commitment increased exponentially.
I’m here in Kuwait and Iraq at the invitation of the Department of Defense with three other governors – like me – from states where a large number of troops have been trained or live.
My visit marks the first time in recent history that a sitting Kentucky governor has visited an active war zone.
In Kentucky, we truly appreciate and support the thousands of troops from our home state who are serving in the far reaches of the world, who protect our nation’s security and promote peace. So when the Pentagon invited me on this trip, I jumped at the chance to meet the troops in the environs in which they’re operating and to tell them personally – again – how much their service means to us.
After a briefing by Secretary of Defense Leon Panetta and other high-level Defense officials Monday morning at the Pentagon, we flew overseas, where we were briefed by Army Gen. Lloyd J. Austin III, the commander in charge of U.S. troops in the Middle East, and others.
In Kuwait, I so far have visited Ali Al Salem Air Base and Camp Arifjan. In Iraq, I’ve met with troops at Joint Air Base Balad, Taji Air Base, Camp Victory Baghdad and Baghdad International Airport (BIAP is a large military base).
More than 2,600 Kentucky servicemen and women are currently deployed to Iraq and Kuwait. Approximately 1,000 troops are deployed from Fort Campbell, as well as an additional 140 troops from Fort Knox.
Nearly 1,500 Kentucky National Guard troops are serving in Iraq and Kuwait, including the 149th Maneuver Enhancement Brigade. This brigade consists of 1,467 soldiers from units in Louisville and Southeastern Kentucky, and just deployed to the area this week. It is the largest mobilization of Kentucky National Guard troops since World War II.
So far I’ve talked with dozens and dozens of Kentucky soldiers – from the Army, the Air Force, the Reserves and the National Guard.
They had some great stories.
They send their love back home.
And their morale, it seems, is high.
It’s amazing to me how these men and women have joined with their colleagues from around the country to pull together and get a difficult job done.
It’s a testament to their discipline and their training … to the strength of the support they get from families, friends and communities … and most of all to their courage and commitment.
Seeing it all firsthand has been one of the most profound experiences of my life.
Stay posted for more updates as I continue my trip. 7/12/2011We recently closed the books on the revenue side of the 2011 Fiscal Year, and the numbers are worth touting:
In short, while growth was predicted during the year, revenues grew significantly more than everyone expected.
In fact, the rate of growth is the highest in Kentucky since the 2006 Fiscal Year, and it reflects the first rise in General Fund receipts in three years.
For the fiscal year that ended June 30 – Fiscal Year ’11 -- General Fund receipts totaled $8.759 billion. That’s 6.5 percent higher than Fiscal Year ’10. It’s also $166.1 million – or 1.9 percent – higher than the official revised revenue estimate.
Now, some of that money -- $31.1 million – represents excess severance taxes that by law must be redistributed to local governments, and it will be.
Take that away, and unbudgeted excess revenues for Fiscal Year ’11 are $135 million.
The enacted budget directs that this surplus can be used for two things – what’s called “necessary government expenses” and the Budget Reserve Trust Fund.
After we close the books on the expenditure side, which we’ll do later this month, we will be putting more than $100 million into the state’s Rainy Day Fund.
The last time that happened was 2007.
To me, that is a very encouraging sign, especially when compared to other states.
We have noted many times over the past three years that while the national recession has forced us to make cuts and make hard decisions to balance our budget, Kentucky has weathered the storm better than many other states.
Kentucky is one of a minority of states that will exceed pre-recession FY ’08 revenues in FY ’11.
That’s a testament to our diverse economy and resilient tax base.
It’s also worth noting that revenue collections showed solid growth in each of the four quarters of the fiscal year – 4.4 percent in the first quarter … 6.3 percent in the second quarter ... 5.2 percent in the third … and an incredible 9.6 percent in the fourth.
As the press release shows, much of the growth came in the area of individual income taxes and sales and excise taxes, as consumer spending rebounded. Corporate income taxes also rose significantly.
In the separate Road Fund, total revenues in FY ’11 were $1.339 billion, an increase of 11 percent – or $132.2 million – from the year before.
Both of the primary revenue streams – motor fuel taxes and motor vehicle usage taxes – were significantly higher.
The Road Fund ended the fiscal year with $73 million in revenues in excess of budgeted levels. $27.9 million of that amount will be distributed to local governments as required by statute, leaving excess revenues of $45.1 million.
When we close the books on the expenditure side, the Road Fund surplus will be deposited into the State Construction Account pursuant to the enacted budget. The funds will be available for certain projects authorized in the Six-Year Road Plan.
The bottom line is that while the economic picture remains challenging with regard to our families, our businesses and the ongoing mission of state government, there continues to be clear signs of economic recovery.
Balancing the budget will continue to be a challenge for the foreseeable future, and we continue to work feverishly to find everyone a job who needs a job.
But today shows we’re headed in the right direction.
Imagine two kindergartners.
One enters the classroom at the beginning of the year excited to be there … grounded in basic knowledge like the alphabet, colors and numbers … well-fed and healthy.
The other has health problems … didn’t get a good meal that morning … and has spent the first few years of his or her life baby-sat by a television, with a mind that has never been challenged.
Which child will have a successful first year of school?
The answer is obvious, and that’s why the main goal of my early childhood initiative is to make sure that all Kentucky children – regardless of where they live – enter kindergarten mentally, physically and emotionally ready to do kindergarten-level work.
To that end, today we took a significant step toward that goal with the formation by executive order of the Early Childhood Advisory Council.
The council was one of the recommendations in the final report of the Governor’s Task Force on Early Childhood Development and Education last December.
Its purpose is to unite stakeholders – in both the public and private sectors -- behind common strategies, standards and goals for how we educate and care for children in Kentucky. It’s also to advocate for improved quality of early childhood services and improved school readiness.
Today I named the 26 members of the council and its leadership.
http://www.governor.ky.gov/pressrelease.htm?PostingGUID={C048E31E-6FD0-4CA9-95E4-5D1B483F52F7}
This is a diverse group of people who are smart, talented and experienced. I look forward to working with them and to seeing the results of that work.
The council’s first task is to help in Kentucky’s application for up to $60 million made available through a new federal Race to the Top initiative called the Early Learning Challenge.
Applications are due by Oct. 15.
Competition will be stiff …but we feel good about our chances. These federal funds will reward states which create comprehensive plans to transform early learning systems with better coordination, clearer learning standards and meaningful workforce development.
7/8/2011$1.3 billion in taxpayer savings.
550 new jobs.
More effective health care for more than 800,000 Kentuckians.
That will be the impact of a new era we kicked off this week in Kentucky’s Medicaid program, one that taps the private sector to increase efficiency, innovation and effectiveness.
It’s called the “managed-care model” of delivering services, and we are expanding it statewide.
The benefits for taxpayers and Medicaid recipients alike will be tremendous:
Savings: New contracts signed with three new managed-care organizations this week will save taxpayers $1.3 billion over three years, including $375 million in the General Fund. In addition, a new annual contract with Passport, the state’s only existing managed-care organization, will save $37.6 million ($10.5 million in General Funds) in the first year.
Fiscal stability: With the Medicaid budget rebalanced this fiscal year, the pressure to “fix” Medicaid by making additional cuts in unrelated areas like education, public safety and job creation will be alleviated, both now and in the future. Like I promised, we rebalanced Medicaid within the program itself.
New jobs: Nearly 550 new jobs will be created in Kentucky, as these companies hire new employees over the next several months to administer their contracts.
Better health outcomes: The delivery of health care services – and thus the health of nearly one in five Kentuckians who access care through Medicaid – will be improved.
The contracts are with three managed-care organizations new to Kentucky and an existing company. The new companies:
• CoventryCares of Kentucky – a Medicaid product of Coventry Health and Life Insurance of Delaware, which provides services in eight states.
• Kentucky Spirit Health Plan – a subsidiary of Centene Corporation, which is based in Missouri and provides services in 12 states.
• And WellCare of Kentucky – a part of WellCare Health Insurance of Illinois, which provides services in seven states.
Those organizations will begin coordinating physical, mental and dental care statewide beginning Oct. 1 for more than 560,000 Medicaid recipients across the state, except for the region currently covered by Passport Health Plan.
Passport has had its contract renewed.
Passport has been providing services to 170,000 Medicaid recipients in Jefferson County and 15 nearby counties for more than a decade. Its work has proven the effectiveness of the managed-care model, and there will be no break in Passport’s service or coverage.
Taxpayers can rest assured that we will have strong oversight over the work of all these companies in Kentucky. We have built strong patient-protection provisions into the contracts, and as you know in January we created a new Medicaid Managed Care Oversight Branch.
There will be bumps in the road, but we are working closely with these organizations to ensure an orderly transition of care and to make sure that taxpayer dollars are well spent.
The goal of managed care is not just to lower overall costs but to also improve outcomes, reduce unnecessary medical services and promote wellness and healthier lifestyles.
The emphasis is on prevention as well as coordination of care.
Some 46 percent of Medicaid caseloads in this country are under managed care.
It’s the model that most other states have either adopted or are moving toward – 20 states expanded their managed care programs in the last two years, and 19 have indicated they will do so in this fiscal year.
Kentucky has joined the list.
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