Coal Severance Tax Revenue

Frankfort, KY — Republican Gov. Matt Bevin offered an election-year sweetener to Kentucky’s coal-county leaders on Friday, saying he’ll push to return 100% of coal severance tax revenues to their counties if he gets the chance to submit another budget proposal to lawmakers. His Democratic challenger, Andy Beshear, noted that Bevin waited until months before the election to make the overture to coal-producing counties in eastern and western Kentucky. Bevin said that his next budget proposal, if he wins reelection, will call for the return of 100% of coal severance tax revenue to coal-producing counties. The governor, whoever that is, will submit a two-year state budget plan to lawmakers in early 2020. Severance tax revenues have dropped amid a decline in coal production in recent years. Coal severance revenues have been split evenly between the state General Fund and coal counties. A policy change to funnel all severance tax money to coal counties would cost the General Fund about $30 million in revenue each year.