economy

Revolution

J.D. Vance, author of the best-selling memoir “Hillbilly Elegy,” returns to his native Kentucky this week. But Vance isn’t selling books this time. He’s leading a bus tour of well-heeled venture capitalists looking for investment options in the region.

Vance worked with AOL founder Steve Case to line up big-name investors for what they call the “Rise of the Rest” tour. Vance is now managing partner for the Rise of the Rest Fund, which names Jeff Bezos of Amazon and former Google executive Eric Schmidt among its investors.


This story is part of a series on coal country by NPR's Embedded podcast. Episode audio is below.

On May 5, 2016, Donald Trump led a campaign rally in Charleston, W.Va.

He put on a hard hat and pretended he was shoveling coal. The crowd loved it.

Report: Kentucky Tourism Generates $15 Billion Impact

May 8, 2018
WKU Public Radio

The economic impact of Kentucky's tourism industry has jumped nearly 4 percent to more than $15 billion.

A report commissioned by the Kentucky Department of Tourism shows the industry supports more than 195,000 jobs across the state and generated $1.5 billion in taxes. Of that tax money, $202 million went to local governments while the rest went to the state government.

Flickr/Creative Commons/Pete Prodoehl

A company that produces aluminum is adding more than 250 jobs and investing over $100 million to improve one of its smelters in Kentucky.

Gov. Matt Bevin announced Wednesday that Century Aluminum will invest roughly $116.5 million for improvements to the smelter in Hawesville and bring back more than 250 full-time jobs. In the fall 2015, Century closed three potlines and laid off about 320 workers at the smelter in a dispute over electricity prices.

Updated at 5:26 p.m. ET

China's leaders followed President Trump in taking another step toward a new trade war, announcing a plan to put steep tariffs on $50 billion of U.S. imports. China's proposed 25 percent tariffs would target a wide range of American products, from soybeans and whiskey to airplanes and cars.

"China currently buys about $14 billion worth of American soybeans each year — almost a third of the entire U.S. crop," NPR's Dan Charles reports for our Newscast unit. "Prices for U.S. soybeans tumbled by 3 to 5 percent" on the news, Dan adds.

Mary Meehan | Ohio Valley ReSource

A tax reform bill that passed Monday by Kentucky lawmakers is now awaiting a decision from Governor Matt Bevin. Some economists are saying the tax plan is more of a tax shift from wealthy individuals to middle and low income Kentuckians.

 

The plan would reduce the income tax rate for individuals as well as corporations. It would also broaden the services that could be taxed, such as landscaping, pet grooming and janitorial work.

Becca Schimmel

A bill aimed at providing an economic development boost to 39 Kentucky counties that purchase power from the Tennessee Valley Authority—or have TVA property—is on to Gov. Matt Bevin’s desk.

As a federal entity, TVA doesn’t pay property taxes on any of its assets in 39 counties in southern, western, and parts of eastern Kentucky.  Instead, the utility pays an in-lieu-of tax to the state, which is five percent of its gross sales.

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Kentucky is ranked the second most federally dependent state in the nation.

A recent study by WalletHub looked at two key factors: state government dependency and resident dependency. Kentucky’s government is ranked fourth in dependency on federal money, but is only ranked 23rd in the share of federal jobs. Analyst Jill Gonzalez said there are some drawbacks to being so dependent on federal money.

Flickr/Creative Commons/Pete Prodoehl

Century Aluminum Executive Vice President Jesse Gary said his company will begin hiring up to 300 new workers for its Hancock County smelter as soon as a proposed tariff order is signed.

President Trump is expected to announce a 10 percent tariff on aluminum and a 25 percent tariff on steel this week. Century Aluminum said its smelter in Hancock County could be back to full capacity by 2019 if the tariff order is signed.

NPR

An analyst from the Tax Foundation said raising the state cigarette tax is the wrong approach to creating new revenue in Kentucky. The Kentucky House passed a 50 cent cigarette tax hike last week as part of a two-year budget bill.

The Tax Foundation said Kentucky’s 2009 cigarette tax increase provided an initial boost in revenue, followed by a significant decline in the following years. Morgan Scarboro with the Tax Foundation said cigarette tax revenues are a volatile and unreliable source of revenue.

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Kentucky won’t be feeling as much of the effect of the federal tax reform law as most other states. That’s partly because the commonwealth doesn’t combine the standard deduction and the personal exemption.

According to a report from the Tax Foundation, Kentuckians won’t see significant changes in their state tax filings. But they will see that some of the exemptions they’ve previously claimed are more limited now.

Senior Policy analyst with the Tax Foundation Jared Walczak said the federal tax law changes are pro-growth and give states a chance to reform their own codes to become more competitive.

Mary Meehan

A liberal leaning policy institute is suggesting the state focus more on raising revenue and less on cutting social programs.  A new report shows that over the past decade the state has had 19 rounds of budget cuts. The governor’s proposed budget includes across the board cuts, as well as reduced funding to some social programs and educational resources.

 

The report from the Kentucky Center for Economic Policy says the state could raise revenue by limiting income tax breaks, taxing online purchases and repealing some tax exemptions. Executive director Jason Bailey said lawmakers seem more willing to look at taxes as an option for raising revenue than they have been in the past.

A liberal-leaning public policy group said Kentucky’s per-pupil spending on public education is lower than it was ten years ago once inflation is taken into account.

During his budget address last month, Governor Bevin promised to maintain per-pupil funding for the state’s K-12 students.

But a report from the Kentucky Center for Economic Policy shows that when inflation is taken into account, the amount of money spent by the state on a per-pupil basis has actually decreased by 16 percent since 2008. Ashley Spalding is a senior policy analyst with KCEP. She said claims that public school funding has been maintained are misleading.

Peabody Energy, Inc., via Wikimedia Commons

At a recent conference in Lexington, Kentucky, economists and community leaders gathered to talk about the state’s current budget crunch and possible economic future. Peter Hille, president of Mountain Association for Community Economic Development, said Kentucky and other Appalachian states need to do more to build a new economy and move from dependence on a single source.

“Because coal played such a dominant role, it took the oxygen out of the room for the development of other sectors of the economy,” he said.


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New data show that Kentucky’s incarceration rate is increasing, while the national rate continues to decline.

 

Figures from the Bureau of Justice Statistics show Kentucky has the ninth-highest incarceration rate in the nation. The commonwealth’s female incarceration rate is more than twice the national average, making it the second-highest in America.

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