FRANKFORT, KY (STL.News) Kentucky’s record-breaking year for economic development is further propelled by small businesses, as today Gov. Andy Beshear announced the Kentucky Small Business Tax Credit (KSBTC) program fueled the creation of 339 new jobs and the reinvestment of $3.64 million in 107 businesses throughout the past year.
“We know Kentucky’s small businesses are strong and resilient, as we have seen them contribute so much to our economy over the past year,” Gov. Beshear said. “This further proves that we are just getting started, on the heels of breaking our state’s economic development records. I’m glad business owners and entrepreneurs are using the KSBTC program to create more jobs for Kentuckians and grow their operations to new heights, as their impact on communities will last for many generations to come.”
The KSBTC program incentivizes companies with 50 or fewer full-time employees that hire and sustain at least one new job and purchase at least $5,000 in qualifying equipment or technology. Applicants can receive between $3,500 and $25,000 in credits annually.
The 339 new jobs incentivized through KSBTC this year pay well, with an average hourly wage of $25.89, excluding employee benefits. Business owners also purchased $3.64 million in qualifying equipment and technology vital to the expansion of business operations. The total incentive amount for 2021 – $1,167,700 – was distributed between the 107 approved applicants across 37 counties.
Since 2011, KSBTC helped small businesses create more than 3,300 jobs and invest nearly $34 million across 74 Kentucky counties. Prior to 2015, KSBTC on average assisted 15 companies annually. Now, the program provides incentives to over 130 small businesses per year.
Job creation and investment spurred through KSBTC advances recent economic momentum in the commonwealth.
This year, the commonwealth has shattered every economic development record in the books. Year-to-date, private-sector new-location and expansion announcements include a record $11.2 billion in total planned investment and commitments to create a record 18,000-plus full-time jobs across the coming years. Kentucky’s average incentivized hourly wage for projects statewide in 2021 is $24 before benefits, a 9.4% increase over the previous year.
In September, Gov. Beshear, Ford Motor Co. executive chair Bill Ford and CEO Jim Farley and Dong-Seob Jee, president of SK Innovation’s battery business, announced the single largest economic development project in the history of the commonwealth, celebrating a transformative $5.8 billion investment that will create 5,000 jobs and places Kentucky at the forefront of the automotive industry’s future.
In July, thanks to strong fiscal management by the Beshear administration, the state budget office reported the commonwealth ended the 2021 fiscal year with a general fund surplus of over $1.1 billion – the highest ever in the commonwealth – and a 10.9% increase in general fund receipts to $12.8 billion.
In May, Moody’s Analytics published a positive economic outlook for Kentucky, noting mass vaccination as the driving force behind a sustained recovery in consumer services. The state’s recovery, Moody’s said, benefited from earlier reopening efforts and increased demand for manufactured goods over services. The report also found Kentucky’s manufacturing industry outperformed the nation’s since the national downturn last year.
Fitch Ratings in May improved the state’s financial outlook to stable, reflecting the commonwealth’s solid economic recovery. The state’s April sales tax receipts set an all-time monthly record at $486.5 million, as did vehicle usage tax receipts at over $64 million.
In March, Site Selection magazine’s annual Governor’s Cup rankings for 2020 positioned Kentucky atop the South Central region, and third nationally, for qualifying projects per capita. The commonwealth also placed seventh overall in total projects, the highest of any state with a population under 5 million. Site Selection also placed Kentucky in a tie for fifth in its 2021 Prosperity Cup rankings, positioning the state among the national leaders for business climate.
For more information on the Kentucky Small Business Tax Credit, visit ced.ky.gov/KSBTC.
In addition, businesses within the state can receive resources from Kentucky’s workforce service providers. Those include no-cost recruitment and job placement services, reduced-cost customized training and job-training incentives.