Kentucky Transportation Cabinet asks for maintenance budget increases as costs surge
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Summary
Deputy Secretary Mike Hancock told the House subcommittee KYTC’s maintenance spending lagged recent actuals and cited a 61% FHWA cost increase since 2020; the cabinet requested $23.6 million (FY2027) and $38.6 million (FY2028) to raise maintenance to $507M and $522M respectively and sought reauthorization/additional funding for five county facility projects.
Deputy Secretary Mike Hancock told the House Budget Review Subcommittee on Transportation that the Kentucky Transportation Cabinet’s core maintenance program is facing sustained cost pressures that threaten routine roadway upkeep and emergency snow-and-ice responses. He cited the Federal Highway Administration’s highway construction cost index, which the cabinet said shows a 61% rise in construction costs from 2020 to 2025, and said that what used to cost $1,000,000 now costs about $1,600,000.
Hancock said maintenance spending from the road fund was $488,000,000 in fiscal 2024 and $511,000,000 in fiscal 2025. The cabinet’s baseline FY2026 maintenance submission was $483,300,000 — below recent actual spending, he said — and maintenance accounts for roughly 25% of an approximately $1.9 billion road fund. KYTC set aside $338,000,000 for routine bridge and roadway maintenance in FY2026; about $35,000,000 of that has been spent so far this year on snow and ice responses (roughly 10% of current-year maintenance expenses). Last year’s snow-and-ice costs totaled about $85,000,000 (about 16% of maintenance spending).
To address rising materials and contract costs (Hancock cited a 9% salt price increase, a 12% rise in hourly contract rates for snow-and-ice drivers and a 36% increase in contract mowing hourly rates over recent years), the cabinet proposed additional maintenance funding included in the governor’s budget: $23,600,000 for fiscal 2027 and $38,600,000 for fiscal 2028. According to Hancock, those increases would raise the maintenance budget to $507,000,000 in FY2027 and $522,000,000 in FY2028 (described as roughly a 5% increase in the first year and 3% in the second).
Hancock also outlined five maintenance-related capital projects needing reauthorization or added funding: additional funding for Ballard County maintenance facility and salt storage ($500,000), Hopkins County maintenance and salt storage ($200,000), reauthorization of a previously authorized $3.5 million Breckenridge County maintenance facility (land acquisition complete; construction not yet started), additional funding for Whitley County maintenance facility and salt structure ($400,000), and additional funding for construction of the District 2 office and materials lab ($250,000). He said the governor’s budget also proposed a $7.5 million annual general maintenance pool to help respond to capital needs across the roughly 1,200 buildings the cabinet owns.
Committee members asked where the increases would come from; cabinet witnesses said the road fund (motor fuels tax, usage taxes, driver’s license receipts and other road fund receipts) is the primary revenue source and that the requests rely on anticipated road fund receipts rather than new general fund appropriations. Members also questioned how constrained maintenance funding would affect routine services such as litter pickup, mowing, vegetation management and pothole repair. Hancock said constrained funding would reduce the cabinet’s responsiveness and likely prompt constituent complaints.
The committee did not take a formal vote on the maintenance request during the session; members said they would follow up with additional questions and staff contact.
