Kentucky Legislature Advances Priority Bills and Budget

House passes tax credit program, Senate takes up state budget

Published on Mar. 2, 2026

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The Kentucky General Assembly is in full swing, with the House passing priority bills like a new tax credit program for education funding, while the Senate takes possession of a draft state budget that includes eliminating an employer health insurance cap and adding money for employee raises and school funding.

Why it matters

As the legislative session progresses, the Kentucky legislature is tackling key issues around the state budget, healthcare, and education funding, which will have significant impacts on residents and the overall direction of the commonwealth.

The details

The House has passed bills like HB1, which allows individuals to direct tax dollars to nonprofits that will distribute funds to both private and public schools. Meanwhile, the Senate is now in possession of the state budget draft, which has eliminated an employer cap on health insurance coverage and added money for employee raises and school funding. Legislators are also working on a Transportation Budget and a Medicaid-related bill (HB2) aimed at rooting out fraud at all levels.

  • The Kentucky General Assembly is currently in session.
  • The Senate received the draft state budget in early March 2026.
  • HB1, the education tax credit bill, has passed the House and Senate and is headed to the governor for signature.

The players

Representative Walker Thomas

A member of the Kentucky House of Representatives who commented on the state budget draft.

Senator Craig Richardson

A member of the Kentucky Senate who discussed the passage of HB1 and the Senate's focus on the state budget.

Representative Myron Dossett

A member of the Kentucky House of Representatives who spoke about HB2, a bill related to Medicaid in the commonwealth.

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What they’re saying

“This makes it so Kentucky has opted into a federal tax credit program where individuals can choose to grant dollars to a non-profit that will distribute those funds to schools and students.”

— Senator Craig Richardson (whopam.com)

“It's not about targeting those who use Medicaid—their hope is find any fraud at any level, including administrative, and make sure the state is getting their bang for their buck.”

— Representative Myron Dossett (whopam.com)

What’s next

Legislators will return to Frankfort today to continue work on the state budget, transportation funding, and other priority bills.

The takeaway

The Kentucky legislature is tackling key issues around the state budget, healthcare, and education funding, demonstrating the ongoing efforts to address important policy matters that will impact residents across the commonwealth.