Legislative Session Update: Funding Approved for Several Regional Priority Projects

Senator Amanda Bledsoe discusses an issue on the Senate Floor during the Legislative Session. (LRC Photo)

This session, Commerce Lexington worked closely with and led community and regional partners to champion public-private investments with high-impact initiatives before members of the General Assembly. Following final passage of House Bills 500, 502, and 900 before the veto recess, lawmakers approved funding for several priority projects that will deliver significant benefits to the Greater LEX region.

​Overall, the General Assembly invested nearly $30 million to support Blue Grass Airport plan to reimagine and expand its terminal. This includes $19.9 million to launch the new terminal expansion, which will add airline gates and accommodate larger aircraft. The upgrades are expected to boost passenger capacity, attract more direct flights, increase regional traffic, and unlock new opportunities for economic development and tourism.

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Complementing this effort, the General Assembly appropriated $5 million to help relocate the Federal Aviation Administration’s air traffic control tower—building on Senator Mitch McConnell’s $5.4 million in congressionally directed federal funding for fiscal year 2026. Relocating the tower is essential to enabling the terminal expansion while modernizing air traffic control operations.
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Additionally, $4 million in state funding will support the relocation and construction of a new home for the Aviation Museum of Kentucky, which must move to make way for the airport’s growth.

This represents a strong foundational investment in modernizing one of Kentucky’s key aviation hubs, enhancing connectivity, and driving long-term economic activity across the Greater LEX region.

Another significant state appropriation to the region is a $20 million investment in the Central Kentucky Business Park Authority, a joint regional industrial development project in Madison County, involving a partnership between Madison County, the City of Berea, Lexington-Fayette Urban-County Government, and Scott County. A 300-acre park in Berea and second location in northern Madison County is aimed at boosting regional economic development, attracting quality businesses, and creating jobs. This investment will assist with getting this regional, multi-county economic development industrial project started by covering infrastructure, development, and land acquisition costs. The interlocal agreement will allow for shared tax revenues from the businesses and industrial developments that locate in the park for all local governments involved.

The General Assembly also supported several quality-of-life and community-enhancing projects across the Commonwealth, with meaningful investments benefiting the Greater LEX region.

The Lexington Children’s Museum received a $5.84 million appropriation to support its move to a new, reimagined location. This state investment will help create a modern, immersive facility designed to serve children and families across Central and Eastern Kentucky and visitors to the region.

Commerce Lexington advocated for additional priority projects in the region, including:

• $200 million in state bonds for the University of Kentucky’s second Health Kentucky Research Building, a critical opportunity for the University to continue to grow its research infrastructure to find discoveries for Kentucky’s most pressing health challenges.
• $2.5 million for the design of a new connector road between Sir Barton Way and Polo Club Boulevard in the Hamburg area, which will improve traffic flow under I-75 and enhance mobility in one of Lexington’s fastest-growing commercial districts.
• $3 million for the construction of Goodwill Kentucky’s new Excel Center in Lexington, expanding access to adult education and workforce training programs that provide second chances and strengthen the regional workforce.

These investments reflect a balanced approach to economic development—pairing major infrastructure and business park funding with projects that improve health outcomes, education, transportation, and family experiences in the Greater LEX region.

The Greater Lexington region continues to leverage statewide grant and funding opportunities to drive economic development, housing, and talent attraction initiatives.

Commerce Lexington is a long-time support of investments in the Kentucky Product Development Initiative (KPDI).  Over the past four years, KPDI has approved $25 million for 18 projects across the Greater LEX region. These targeted investments have successfully leveraged an additional $70 million in private and local funding, amplifying the program’s impact on regional growth and increasing job ready land.

Recognizing the fund’s strong track record, the General Assembly approved an additional $50 million in statewide funding for the next two years. This renewed investment will allow future high-impact projects in the Greater Lexington area to continue accessing this valuable resource for economic development, innovation, and job creation.

As economic development momentum builds across the Greater Lexington region, access to a talented and skilled workforce remains essential for sustained business success and growth. To address this priority, the Greater LEX regional competitiveness plan is supported by an annual investment of approximately $1.6 million from private businesses and local governments. This funding powers targeted economic development and talent attraction initiatives aimed at locating skilled workers and industries to the region.
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Building on this foundation, Commerce Lexington, alongside 15 business and education organizations— formed a statewide Talent Attraction Marketing Coalition. As a result, the General Assembly approved $5 million over the next two years to establish a competitive talent recruitment grant program within the Cabinet for Economic Development. Local governments, nonprofits, and regional organizations like Greater LEX will be eligible to apply for these grants to strengthen student retention, workforce development, and talent attraction efforts across Central Kentucky.

Housing availability and affordability remain a top priority for Commerce Lexington and the Greater LEX region, especially as business growth and talent attraction continue to accelerate. During this Legislative Session, the General Assembly took meaningful action by creating a new Residential Housing Infrastructure Fund with an initial $10 million investment. Administered by the Kentucky Infrastructure Authority, the fund will provide low-interest loans to local governments for critical infrastructure projects—including construction, upgrades, renovation, or expansion of publicly owned or maintained systems that support new residential development.

In addition, lawmakers allocated another $5 million to Kentucky’s Affordable Housing Trust Fund, strengthening ongoing efforts to expand access to quality, attainable housing across the Commonwealth. These new housing investments complement the region’s broader economic development and talent strategies by helping ensure that the Greater LEX area can accommodate a growing workforce and thriving business community.

Additional key investments benefiting the Greater LEX region include:

• $50 million for Eastern Kentucky University’s new Osteopathic Medicine program, which will expand medical education and help address Kentucky’s ongoing healthcare workforce needs.
• Significant funding for water and wastewater infrastructure improvements in Clark, Woodford, and Bourbon Counties, supporting sustainable growth and improved quality of life in these fast-developing communities.
• $1.5 million for upgrades to the Lexington Children’s Theatre, enhancing cultural and educational opportunities for families across Central Kentucky.
• $2 million for the Kentucky Science and Technology Corporation to advance Kentucky’s emerging space economy, including strengthened partnerships with Lexington-based startup Space Tango.

This successful package of investments reflects more than two years of focused coordination by Commerce Lexington with local governments, business leaders, and regional stakeholders. Their partnership was instrumental in delivering these meaningful wins for the region and boasting regional competitiveness.