Better Kentucky Plan Includes $250 Million to Improve Water Infrastructure Across Kentucky

News ,

Call for projects begins June 1 for local utilities; 3,800 jobs to be created

FRANKFORT, Ky. (June 1, 2021) – Gov. Andy Beshear today announced a Better Kentucky Plan that will help Kentucky create 14,500 jobs and help build better schools, expand internet and deliver clean drinking water and quality sewer systems across Kentucky.

The plan’s $250 million Cleaner Water Program is the first program to accept applications since Gov. Beshear and Kentucky lawmakers reached a bi-partisan agreement at the close of the 2021 General Assembly to invest nearly $700 million in federal relief funds for infrastructure initiatives.

“Quality drinking water and well-maintained sewer systems are fundamental to keep Kentuckians safe and to build a better Kentucky,” said Gov. Beshear. “This funding boost will make a real difference in cities and counties across Kentucky while also creating more than 3,800 direct and indirect jobs. Today’s announcement is another win for Team Kentucky, and we are well on our way to leading in the post-COVID economy.”

Starting June 1, Water Resource coordinators, representing Kentucky’s 15 Area Development Districts (ADD) and Area Water Management Councils, may submit project profiles through the Water Resource Information System (WRIS) portal to indicate interest in funding from the Cleaner Water Program. Eligible government agencies, such as city-owned water or sewer utilities, water commissions, water and sewer districts and counties, may collaborate with a coordinator and council to submit a project. There are 713 public drinking water and wastewater utilities in Kentucky.

“Normally, when we do these projects, the cost would end up on your water bill,” said Gov. Beshear. “This is a chance for us to upgrade our systems without raising costs on Kentuckians. It’s a real chance to be transformative.”

Funded by the American Rescue Plan Act and administered by the Kentucky Infrastructure Authority (KIA), $250 million has been appropriated for clean drinking water and wastewater grants to fund projects across Kentucky. Funding will be allocated in three ways:

  • $150 million will be allocated based on each county’s proportion of the state’s population, with the exception of Jefferson County’s share, which is discounted by 50% based on its high per capita allocation from the federal act. A list of the allocations by county can be found here.
  • $50 million is available for grants to utilities to provide drinking water services to unserved, rural customers or to utilities under a federal consent decree. The KIA shall consider social, economic and environmental benefits in determining the allocations.
  • $49.9 million is available to supplement a project grant for a project with a cost in excess of a county’s allocation amount and other available grant sources. The social, economic and environmental benefits shall be considered in determining project allocations. KIA will receive $75,000 to administer the grant program.

The application process will be ongoing throughout 2021 until all funding is committed. KIA will begin reviewing projects this summer and make awards continuously throughout the year. All grant awardees must obligate the funds by December 31, 2024.

“Investing in infrastructure extends beyond roads and bridges -- it includes our water systems too,” said Cleaner Water Program Grant Manager and Kentucky Transportation Cabinet Secretary Jim Gray. "The projects funded through this grant help our state take steps in the right direction to address the backlog of water and wastewater infrastructure needs without raising costs to Kentuckians for the upgrades.”

“This funding will deliver transformational projects in communities across the commonwealth with long-term benefits,” said Kentucky Infrastructure Authority Executive Director and Public Protection Cabinet Deputy Secretary Ray Perry. “We look forward to the flurry of project activity in the coming years to build a better Kentucky.”

The American Society of Civil Engineers in 2019 projected that Kentucky faces nearly $14.5 billion in water/wastewater infrastructure needs over the next 20 years, including over $8.2 billion in drinking water upgrades and $6.2 billion in sewer system improvements.

Information about the Cleaner Water Program, as well as grants for broadband expansion, school facility upgrades and vocational education center renovations, can be found at https://governor.ky.gov/BetterKy/.

The Better Kentucky Plan adds to recent economic momentum in the commonwealth, as the state builds back stronger following the effects of the pandemic.

In recent weeks, Fitch Ratings – one of the nation’s Big 3 credit rating agencies, improved its financial outlook on the state to stable, reflecting the commonwealth’s solid economic recovery. Days later, Moody’s Analytics published a positive economic outlook for Kentucky, noting mass vaccinations as the driving force behind a sustained recovery in consumer services. The state’s economy, Moody’s said, was recovering with “gusto” and benefited from earlier reopening efforts and increased demand for manufactured goods. The report also found Kentucky’s manufacturing industry outperformed the nation’s since the national downturn last year.

In addition, 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.

And 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.

More Information
Read about other key updates, actions and information from Gov. Beshear and his administration at governor.ky.gov and the state’s response to COVID-19 at kycovid19.ky.gov.