Week Eight of the 2026 Legislative Session
Crossover of proposed legislation is in full swing in the Capitol Annex, and more than half the session is complete. The General Assembly is moving into its most consequential stretch. Senate bills are being considered in the House of Representatives, House bills are advancing in the Senate, and the policy debates that define this session are sharpening.This week, the General Assembly advanced one of the session’s most significant education measures, House Bill 1, allowing Kentucky to opt in to the federal Education Freedom Tax Credit program created by Congress in 2025. Beginning in tax year 2027, the program offers a dollar-for-dollar federal tax credit of up to $1,700 for donations to certified scholarship-granting organizations that fund K-12 educational expenses. States must formally opt in for students to benefit, and more than two dozen have already done so.
Eligible students must come from households earning up to 300 percent of the area median income, making most Kentucky working- and middle-class families eligible. Scholarships, distributed by certified nonprofits that must direct at least 90 percent of contributions to students, may be used for tuition, tutoring, special-needs services, instructional materials, technology, transportation and other approved expenses. Public school students are not excluded and may use funds for qualifying educational support.
HB 1 does not create a new state program, raise taxes or reduce SEEK funding. The federal tax credit can be claimed regardless of Kentucky’s decision; the question is whether those contributions support students here or flow to other states. By opting in, Kentucky keeps those federal dollars in-state and expands educational opportunity without increasing state spending.
State budget update
As noted in prior updates, the top priority during a 60-day legislative session is our responsibility to enact a new two-year state budget. We’ve heard from many regarding the initial version of the House’s budget proposal, HB 500. HB 500 was a bare-bones starting point, and significant modifications were made this week. With the Senate now officially in receipt of the House’s proposal, next week is when our deliberate and meticulous work really begins.
I experienced success with two bills passing off the Senate floor this week. Senate Bill 157 will clarify Kentucky law governing certain mortgage loans and ensure greater consistency with federal lending standards. The bill also exempts loans with points and fees below the federal threshold from existing total net income limits and applies to contracts entered into after the effective date, aligning Kentucky law with federal standards and promoting consistency in mortgage lending practices.
Senate Bill 214 allows the Kentucky Department of Agriculture to accept and manage nonfederal funds and grants from public or private sources that support its programs and clarifies the department’s authority to apply for, administer and spend funds at all levels of government. The bill includes an emergency clause that allows the department to immediately pursue privately funded grants that would benefit agriculture across the commonwealth.
Several other measures were approved in the Senate this week and were either delivered to the governor’s desk or sent to the House for consideration.
SB 33 strengthens oversight of recovery residences by closing certification loopholes and requiring the state to notify local officials when a residence seeks certification, is certified or faces discipline.
SB 37 designates the treeing Walker coonhound as Kentucky’s official state dog in recognition of its









































