For the second election in a row, voters made it clear that affordability is their chief concern. The inflation numbers show us why. Because of price hikes over the past two years, the median Kentucky household is now spending $4,127 more annually for the same goods and services than they were at the end of 2024.
Gas prices make up the single biggest item in that increase, but families are also shelling out more for everyday household purchases, utilities, groceries and more. That would matter less if wages were keeping up. But they are not.
An end to the war in Iran and the president’s chaotic, across-the-board tariffs would surely help. But the cost of living was voters’ top priority even before those problems.
With the Kentucky General Assembly coming up, there are countless ways the state legislature could ease household budget strains. We at the Kentucky Center for Economic Policy laid out dozens of ideas in a comprehensive report last year.
But it makes sense to start with low-hanging fruit, including issues many in the Republican majority already support.
In the 2026 session, lawmakers nearly passed Senate Bill 9, legislation that at least begins to address the housing crisis by streamlining some regulations, encouraging density and allowing a way to clear eviction records. It stalled only because of a last-minute poison pill that would prevent local regulations of short-term rental properties like AirBnBs.
Lawmakers should discard that harmful portion and pass a stronger package. Funding for housing is critical, so the legislature needs to enact HB 411 sponsored by Rep. Steve Bratcher (R-Hardin), which modernizes the real estate fees used to fund the Affordable Housing Trust Fund. And they should take an additional step to jumpstart that fund with one-time dollars.
A rare, one-time corporate income tax payment this summer has given the state $330 million in unexpected tax revenue. That money could be invested in the Affordable Housing Trust Fund to spur the construction of new mixed-income housing. Legislators have spent nearly $5 billion on capital projects over the last couple of budgets, but only 0.3% of it for housing. Shouldn’t we do more for the biggest cost in any Kentucky family’s budget?
The cost of health care is also a grave concern. The most pressing issue is the need to fully fund Medicaid, which covers one in three Kentuckians and is short $421 million that was left out of the original budget. Otherwise, we’ll see cuts to services, as nearly happened last summer, leading to lost coverage and care and higher costs for everyone seeking health care. The money to make the program whole sits in the Budget Reserve Trust Fund, but lawmakers must appropriate the funds.
In addition, utility bills continue to strain Kentucky families. The biggest fear in the short term is that the demand from artificial intelligence (AI) data centers will drive those costs higher. Lawmakers should quickly pass robust rules that prevent Big Tech from passing burdens to ratepayers, require local community involvement and democratic buy-in to the location of data centers, and roll back the enormous tax breaks that the legislature offered these companies.
Much more can and should be done. From infant care to retirement, from home insurance to health insurance, and from college debt to drug costs — there are commonsense policy actions the state could take to make life more affordable. That includes taking on new forms of price gouging — like the “surveillance pricing” big corporations now use to adjust what you pay in real time based on the data they collect about you.
And let’s not forget the central need to raise wages and job quality for Kentucky workers. Affordability is not just about how much things cost, but how much is in your pocket to pay for them. Very popular ideas to raise wages are already available, like repealing right-to-work, restoring the prevailing wage law, permitting more public sector union organizing, and raising the outdated minimum wage.
Some of these issues aren’t politically viable yet. But in the 2024 and 2026 elections, voters revolted against incumbents from both parties over the problem of affordability. It’s a risky bet to expect they won’t do so again.
This column ran in the Kentucky Lantern on Nov. 9.
