WASHINGTON--(BUSINESS WIRE)--The Rural Jobs Coalition applauds Rep. John Blanton (R-92) for introducing the Kentucky Rural Jobs Act, HB203.
“A decade after the Great Recession many rural Kentucky counties are still waiting for the recovery and we need a bold strategy to get things back on track,” said Blanton, the bill’s lead sponsor. “I am proud to be leading the way with the Kentucky Rural and Opportunity Zone Jobs Act to unlock $150 million of capital for small, rural businesses.”
Participation in the program, to be administered by the Kentucky Cabinet for Economic Development, is limited to federally licensed USDA Rural Business Investment Companies or SBA Small Business Investment Companies, who must demonstrate experience and expertise in rural growth-focused investing.
Modeled after the highly successful federal and state New Markets Tax Credit (NMTC) programs, the bill provides up to $75 million of matching tax credits for qualified investments in rural counties and federally-designated opportunity zones across the state.
A recent study of Kentucky’s NMTC program revealed the state will receive 81% more in tax revenue and cost savings than it gives in tax credits over the 10-year window. Two current studies of the impact of Kentucky New Markets by economist Dr. Alfie Meek underscore the benefits of hiring Kentuckians who transition from state aid for food, medical care and income assistance to wage earners.
Companies across Kentucky have been able to access private investment capital through tools like NMTC, facilitating business growth, good quality jobs and greater opportunity for all Kentuckians.
“Our success in Cynthiana shows how effective these programs can be, where we were able to invest and create 170 jobs, growing to over 250 employees, with the potential for 100 more in the near future,” said Nate Nedley, Chief Financial Officer of EZ PACK. “It’s staggering to think how much good $150 million of new investment could do for rural Kentuckians.”
The Rural Jobs Act requires three-fourths of the investment go to small businesses in rural counties with populations of 50,000 or less. Under HB203’s framework, a minimum of $100 million must be invested in the first two years, with the remaining balance invested over the life of the program.
The rest of the investment will be made in small businesses in Opportunity Zones, some of the Commonwealth’s most economically depressed areas, ensuring that businesses across Kentucky benefit from the new capital.
“I’m happy to see the introduction of the Rural Kentucky and Opportunity Zone Jobs Act, which will draw investment to rural areas of our Commonwealth,” said Kentucky Commissioner of Agriculture Ryan Quarles. “Rural Kentuckians are some of the most talented and hardest working people in the state—there’s no better group to invest in. Rep. Blanton should be commended for his aggressive approach to seeding investment in our agricultural communities.”
“Rep. Blanton’s bill goes straight to the heart of a critical challenge—attracting investment that creates jobs and benefits rural Kentucky,” added Mark Haney, President of Kentucky Farm Bureau. “Farm communities have been hit hard by economic changes. The Rural Kentucky and Opportunity Zone Jobs Act can change the tide for these rural communities that are the backbone of our Commonwealth.”
Across every investment, companies benefitting from the fund will be expected to provide on-the-job training to strengthen Kentucky’s workforce, making these regions more competitive for additional investment.
The Rural Jobs Act includes tight financial controls. Approved fund managers are required to secure independent analysis certifying a positive return on investment for the state. Failure to create the projected number of jobs triggers penalties for fund managers and claw-back provisions for tax credits.
“Between these new studies and the successes we’ve seen in states like Georgia, Ohio, and Utah, it’s clear that tax credits, properly targeted and managed, are excellent strategic investments,” said Ab Basu, Executive Director of the Rural Jobs Coalition. “We commend Rep. Blanton for his leadership and look forward to working with him to ensure this $150 million materializes for rural Kentucky.”
About the Rural Jobs Coalition
The Rural Jobs Coalition is a nonpartisan organization formed for small businesses by small businesses to highlight to lawmakers the message that the rural economy matters. Learn more at https://ruraljobscoalition.com or visit Twitter or LinkedIn.