By Tom Latek
Kentucky Today
The Office of State Budget Director reported on Wednesday that both General Fund and Road Fund receipts fell in May compared to a year ago, but can still reach the forecast estimate on June 30, the end of the state’s fiscal year.
May’s General Fund receipts fell 3.0 percent, with revenues of 1,163.9 million, compared to $1,200.3 million during May 2025. Receipts have now grown 1.3 percent for the first eleven months of FY26.
The official General Fund estimate is $15,498.9 million, which is 1.3 percent less than what was collected last year. With one month remaining in the fiscal year, collections can decline 27.2 percent in June and still hit the estimate and can decline by 16.2 percent to avoid the forecasted $156 million General Fund revenue shortfall.
State Budget Director John Hicks said, “Receipts are on pace to exceed the official revenue estimate, in part due to 6.0 percent year-to-date growth in the sales and use tax. May’s growth of 7.9 percent signals strength in the Kentucky economy, especially considering that the spike in gasoline prices has crowded out household income available for other purchases. Receipts from payroll withholding from the individual income tax are strong with just a 5.2 percent drop in collections while the tax rate dropped 12.5 percent from 4 percent to 3.5 percent in January, indicating that wage, salary, and employment growth have offset more than half of rate-lowering effect.”
Road Fund receipts, meanwhile, fell 3.9 percent in May with collections of $159.2 million. Year-to-date collections have decreased by 1.1 percent. The official Road Fund revenue estimate calls for a 1.0 percent decrease in revenues for the fiscal year. Based on year-to-date tax collections, revenues can fall 0.1 percent in June and still meet the estimate. Among the accounts, motor fuels revenue declined 0.7 percent, motor vehicle usage collections dropped 7.8 percent, and license and privilege revenues grew 7.0 percent.