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Louisville Faces Devastating Budget Shortfall



  • Despite a growing economy, Louisville Metro Government continues to face significant budget challenges because of an expected $65 million general fund gap over the next four years.
  • Louisville Metro Government has proven it is an efficient operation, and the city is seeing good growth in revenue, but that growth is dwarfed by increased pension requirements from the state retirement board.
  • That amounts to $86 million in FY19, up from $77 million in FY18, and is expected to grow to $97 million in FY20, then to $136 million in FY23.
  • The estimated gap for FY20 is $35 million, which reflects the additional $10 million pension bill for FY19, another $10 million for FY20, along with $15 million from increased healthcare costs and lower-than-projected revenues.


  • Eliminated 49 positions and adopted new fees in FY19 budget.
  • Currently only approving vacant positions and reclassifications if certain essential function criteria are met, including whether the vacancy would require overtime or is mandated.
  • Freezing discretionary spending on travel, training, technology, office supplies, subscriptions & assigned vehicles.
  • Implementing an EMS cost recovery fee increase that will generate $1.9M annually and bring our fees into greater alignment with similar services.
  • You can see detail of Louisville Metro's effectiveness and efficiency HERE.


  • Governmental services would have to be cut to match our levels of funding.  This will severely affect all areas, but predominantly personnel, as staff comprise about 70 percent of our budget -- and primarily public safety, as it makes up approximately 60 percent of the operating budget. 
  • The specific potential cuts include staffing reductions in nearly every department, including police, fire and emergency services, as well as closing library branches, fire stations, health clinics, community centers, pools and city golf courses.  Other potential cuts include eliminating all Metro funding for Brightside and the Belle of Louisville, making the Louisville Zoo independently operated, turning Youth Detention Services back over to the state, and eliminating all Neighborhood Development Funds allocated by Metro Council and External Agency Funds allocated to local nonprofits for arts and social and community services.
  • You can see a spreadsheet of the specific potential cuts HERE.



  • An increase in the city’s tax rates on five types of insurance premiums from their current five percent to 12.5 percent in FY20 and FY21, 13.5 percent in FY22 and 15 percent in FY23 will entirely resolve the city’s budget gap for the coming year and beyond.
  • This plan would increase the average family’s premium tax by about $12-$13 a month, or 40 cents per day.
  • This plan represents the best option for the city’s future, given options for raising revenue are extremely limited.
  • You can learn more about the proposal HERE.
  • See revenue options HERE.



  • Louisville Metro’s insurance premium tax is currently set at 5% and can be increased by Metro Council without any statutory caps.
  • Each percentage increase would generate an estimated $12 million in revenue annually if all lines of insurance are equally increased. This assumes that all suburban cities will implement the same rate as Louisville Metro as the suburban cities keep their own revenues.
  • There are concerns about the disparate impact of insurance premium increases since there is evidence of redlining with car insurance rates. However, individual lines of insurance can be adjusted to help mitigate these concerns.



Please contact your Metro Council member and share your view.

The proposal to avoid the devastating cuts is co-sponsored by:

  • President David James
  • Councilman Bill Hollander
  • Councilman Pat Mulvihill
  • Councilwoman Barbara Sexton Smith
  • Councilman Marcus Winkler


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