As COVID Cases Mount in Ky., Governor Warns of Poor Economic Outlook
During his daily briefing on COVID-19 in Kentucky on Wednesday, Governor Andy Beshear offered some positive and some gloomy outlooks related to the state's economy.
Beshear also announced another high number of confirmed COVID-19 cases in Kentucky, with 518 newly confirmed cases on Wednesday.
The governor said that the state will close out the 2020 fiscal year without a budget shortfall, despite the economic challenges brought on by the pandemic. Beshear said that the state's general fund revenues came in "far higher than was expected only months ago." He also praised state agencies for reducing their spending by a 1 percent annualized amount in the past two months.
Beshear said that those agencies did better than that by limiting hiring and holding the line on discretionary expenses.
There will be a surplus as the fiscal year closes, he said. In May, the state had anticipated a shortfall of $457 million.
That means, Beshear said, there will be no cuts to education or health and public safety, and no cuts to the state judicial or legislative branches.
The state will see an 18 percent increase in its rainy-day fund, Beshear said, as well as increased revenue from the Kentucky Lottery which he said would result in another $15 million for need-based student financial aid in the coming school year.
Moving forward, though, the outlook is not as bright, he said, noting that threats remain in the next fiscal year. Fourth quarter revenue, which bore the brunt of the pandemic so far in April through June, saw a decline of nearly 8 percent, Beshear said. That marks the worst financial quarter for Kentucky since the Great Recession.
Road funds also declined by 23.5 percent, he said.
Without additional federal assistance, the governor said, there would be even deeper budget cuts in Kentucky than those experienced in the Great Recession.
Meanwhile, the 518 newly confirmed cases of COVID-19 in Kentucky bring the state's total to 24,540 since the pandemic began. Fourteen of those cases involved children under the age of 5.
The positivity rate has also increased to 4.92%, reflecting the number of people testing positive as a percentage of those tested overall. 5% is largely considered a troublesome spot in which governments should consider re-implementing some economic shutdown measures as experienced previously, Beshear has said before.
“Our positivity rate has gone up. That is a concern and that shows it’s not just an increase in testing, it’s more people that are being tested are showing positive results,” Beshear said. “That’s why we’re going to do what it takes to defeat the coronavirus.”
Three additional COVID-related deaths were reported on Wednesday bringing the state's total to 677.
As of Wednesday, there have been at least 560,161 coronavirus tests performed in Kentucky.
At least 7,000 people in Kentucky have recovered from the virus.