LOUISVILLE, Ky. (WDRB) -- Kentucky lawmakers gathered in Frankfort on Tuesday to discuss funds from the American Rescue Plan Act and how local governments plan to spend the money.

Among those who made presentations to the Interim Joint Committee on Local Government were J.D. Chaney, the executive director and CEO of the Kentucky League of Cities; Sandy Williams, the executive director of the Kentucky Infrastructure Authority; and Jim Henderson, the executive director of the Kentucky Association of Counties. 

Chaney said many cities across the state were considering using the money to provide payments to essential workers, but these efforts are complicated by a Kentucky law that doesn't allow bonuses. So, he said many city governments are looking into how to offer premium pay. 

Sen. Robby Mills, R-Henderson, raised concern over making pay changes with one-time ARPA funds.

"Chairman Mills, you hit on my worst fear," Chaney said. "I'll say it again. This money ain't no panacea. It's temporary money." 

Chaney advised that the league wants cities to take time to consider their options, given that cities don't have to decide where the funds go until December 2024, and the money doesn't have to be spent until December 2025.

Kentucky Sen. Damon Thayer voiced concerns about the impact of so many people working from home on local taxes.

Chaney said Thayer's concerns are valid, as working from home takes taxes away from the city or county they work in, and going instead to the city or county they reside in.

After Chaney, Williams spotlighted the impact of heightened construction costs on funding for various water and sewage infrastructure projects. She said the Kentucky Infrastructure Authority has already set aside nearly $50 million from ARPA funds to help with the unplanned cost increases. 

Lastly, the committee heard from Henderson about the state of county governments. He said he echoes a lot of Chaney's sentiments. 

"It's somewhat challenging to have had this opportunity for some of our counties to figure out because it is one-time money," Henderson said.

Henderson said for county government many are considering ARPA money to go to broadband, clean water, public safety equipment and in rural counties outright buying ambulances.

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