2016 Interim LEGISLATIVE Volume 29, No. 4 August 2016 * Read on-line at www.lrc.ky.gov/legislation.htm RECORD State’s aviation and aerospace industry rockets skyward by Rebecca Hanchett “We are now doing some very, very exciting LRC Public Information work that is now emanating out of Kentucky on this brand new area of medicine. And I’m happy FRANKFORT--Engineers watched a few to say we’ve got mission in the pipeline now weeks ago from a control room inside an old in cystic fibrosis, cancer… really interesting hospital building in Lexington as a small box neurobiology work and also in drug design,” was pushed into place aboard the International said Kimel. Space Station. The presentation by Kimel and other Designed and built in Kentucky under the testimony by Peter Lengyel, the president and direction of Kentucky-based Space Tango, the CEO of Safran USA—an aviation, defense box is a laboratory called TangoLab 1, filled and security company with approximately 300 with 21 cubes capable of running different workers in Kentucky—both illustrated the bioengineering experiments simultaneously. strength of aviation and aerospace in Kentucky As a screen on the front of the box lit up after where Cabinet for Economic Development installation, Space Tango founder Kris Kimel General Counsel Caroline Boeh Baesler said breathed a sigh of relief. aviation and aerospace exports have edged out “See the lights come on?” he asked California so far this year. members of the Interim Joint Committee on Boeh Baesler said Kentucky’s aviation and Labor and Industry on Aug. 18 as they watched aerospace exports topped $8.7 billion last year a short video of the event. “It would have been and have reached $5.2 billion through June of really bad if they didn’t come on. So we were this year. quite pleased with that.” “We’re already up 19 percent this year and Kimel told the committee that the laboratory we’ve surpassed California to be number two is part of the growing field of exomedicine. (in exports behind Washington State). So we The field is positioned to make breakthroughs have a good trend going on right now,” she said, Rep. Lynn Bechler, R-Marion, an aerospace engineer, in regenerative medicine, oncology and other adding most of Kentucky’s exports are going to asks a question during the Aug. 18 meeting of the medical fields using microgravity as a tool. And the UK, France and Brazil with growing demand Interim Joint Committee on Labor and Industry. Kentucky, he explained, is at the center of it all. Continued on page 2 Tobacco is still greening up Kentucky’s economy by Rebecca Hanchett LRC Public Information ers’ parents and their parents before them. For levels. And that success is largely due to tobac- It used to be nearly impossible to drive many, tobacco was Kentucky. co, too, says Governor’s Office of Agricultural through Kentucky in August and not see tobacco Today the number of Kentucky tobacco Policy Executive Director Warren Beeler. growing in a field. growers has fallen to 4,500, but tobacco is still Beeler told the state legislative Tobacco In the summer of 1998, the leaf crop ac- very much alive across the state. The crop ac- Settlement Agreement Fund Oversight Com- counted for 25 percent of the state’s farm cash counts for a fair amount of all agricultural cash mittee on Aug. 3 that Kentucky’s dedication of receipts and was grown by 46,000 farmers state- receipts-- about six percent--at a time when wide. It was also grown by many of those farm- overall agricultural cash receipts are at record Continued on page 2 THE KENTUCKY GENERAL ASSEMBLY 1 Rep. Brent Yonts, Aerospace, D-Greenville, from page 1 comments on the educational in China. and economic Committee Co-Chair Sen. Alice Forgy development Kerr, R-Lexington, complimented her fellow aspects of lawmakers for their support of 2015 House Kentucky’s aviation Joint Resolution 100, legislation sponsored by House Majority Floor Leader Rocky Adkins, and aerospace D-Sandy Hook, that honors the state’s aviation industry during the and aerospace industry and requires a study of Aug. 18 Interim the industry’s overall economic impact. Joint Committee on “To me it’s the most exciting thing going on Labor and Industry Kentucky—this industry and everything you all meeting. are creating and doing,” said Kerr. Growth in exports by the industry was highlighted by Rep. Brent Yonts, D-Greenville, who said he read that Kentucky’s aerospace exports are now double its automotive industry exports. Boeh Baesler said that is true when motor vehicle and motor vehicle parts are included in the automotive export mix. companies find it hard to raise local capital and in Kentucky startup companies. Additionally she “For 2015, if you look at just motor vehicles must often rely on investors from Silicon Valley said Kentucky has an Angel Investment Network it was about $3.8 billion but if you also look at or the West Coast, he said. in place to match up investors with ventures that motor vehicle parts and other supplies, it creeps “Historically this has not been the kind of interest them. it up closer to $5 billion but you’re right--it thing that Kentuckians have invested in. We For the company’s part, Lengyel said exceeds even motor vehicle manufacturing by understand that,” said Kimel. “It’s not about companies themselves have an obligation to do quite a bit,” she said. the legislature appropriating money—it’s really their homework and ensure they are making the When Rep. Larry Clark, D-Louisville, asked helping us education and demonstrating that the right investment. “We know what our needs are the presenters what their industry needs from state… supports these kinds of efforts.” going to be so there’s an obligation on our part to the Kentucky General Assembly to continue Boeh Baesler said capital investment look through the economic development folks, to grow within the state, Kimel said education. have recently been aided by Kentucky’s Angel to partner directly with the local community He later asked lawmakers to encourage more Investment Tax Credit, a program she said gives colleges to make sure that our manpower needs local private investment. Technology-driven a “very generous tax credit” to those who invest are (met).” Rep. Wilson Stone, D-Scottsville, said many ported by the Kentucky Corn Growers Associ- Tobacco, delegates to the meeting were impressed with ation, Kentucky Small Grain Growers Associ- Kentucky’s use of its tobacco settlement dollars ation, Kentucky Cattlemen’s Association and from page 1 to diversify its agricultural economy. others, will pay dividends for the next 50 years. Beeler said he heard from individuals in Proposed work with ryegrass alone could have a half of the funds received from a 1990s nation- state after state across the South who said “they big payoff, he said. al master settlement with tobacco companies to wish they’d done what we’d done.” Kentucky’s Sen. Paul Hornback, R-Shelbyville, gave agricultural diversification is the envy of many efforts have almost doubled its receipts at the special thanks to the Corn Growers Association states. The appropriation was set out in 2000 farm gate, he said. which Hornback said purchased property for the House Bill 611 which helped propel the state to “It’s no coincidence… Don’t tell me it is, center that will be leased to UK for repayment. a record $6.5 billion in agricultural cash receipts because plain-and-simple fact is we know this “I appreciate what you all did,” he said to mem- in 2014. money has worked,” he told the committee. bers of the association and all involved in the “We are the envy of all states with our to- The biggest project in the history of the project. bacco money,” said Beeler. “We’ve gone from GOAP and the Kentucky Agricultural Develop- “Everybody is very appreciative” for this $3.7 billion (in total agricultural cash receipts) ment Board which it administers is a $30 mil- project, Beeler assured lawmakers. when we got the (settlement) money to $6.5 lion grain crops and forages center planned for The center will feature new meeting facili- billion now, and I don’t think that’s a coinci- construction on the property of the UK Research ties, laboratories, offices and improved internet dence....” and Education Center in Princeton. Half of the access “so professors at the center can teach Lawmakers thanked Beeler, former GOAP project amount, of $15 million, will be provided classes for students in Lexington,” according to Executive Director Roger Thomas and others as a matching grant from the Agriculture Devel- a press release on the center from the University for speaking at last month’s Southern Legisla- opment Board, said Beeler. UK must match the of Kentucky. “… All commodity areas based at tive Conference Annual Meeting in Lexington award for the center. Princeton ... will benefit from the improvements about HB 611’s successes. Committee Co-Chair Beeler said the project, which is also sup- and expansion.” 2 2016 Interim LEGISLATIVE RECORD Legislative panel rolls into Bowling Green by Jim Hannah Spande, said the Corvette generates $3.5 billion LRC Public Information in annual revenue for GM. “It’s a big deal for our company,” he said The international notoriety of a sinkhole of the car. forming under the sky dome of the National Spande said GM is spending $440 million Corvette Museum and upgrades at the General on a new state-of-the-art paint shop, $44 million Motors’ plant that assembles the iconic sports new on powertrain products, $2 million on a so- car has been a boon for Bowling Green, a group lar array and $290 million in other unspecified of state legislators was recently told.