Proposed legislation gives Kentucky aircraft owners a break

Supported by AOPA, House Bill 447 was introduced February 15 to the Kentucky House Transportation Committee. Rep. Jonathan Dixon, the bill’s lead sponsor, said the proposal is aimed at making the state more competitive in attracting aircraft that drive business to its general aviation airports. “This isn’t about giving someone a tax break, it is about using our resources to create jobs,” Dixon said.

In October, stakeholders began meetings to come up with ideas to promote Kentucky’s GA airports. A recent operational plan was released by the Kentucky Department of Aviation that, among other things, included eliminating the tax on tangible property including personal aircraft. Doing so would make Kentucky one of many states to take similar action.

AOPA Great Lakes Regional Manager Kyle Lewis testified on behalf of the legislation, reinforcing Kentucky’s disadvantage among surrounding states and its tax situation. Lewis said neighboring states Ohio, Indiana, and Tennessee do not assess a property tax on not-for-hire aircraft. Because of this, Kentucky residents who own aircraft tend to base their airplanes out of state, if geographically feasible. In turn, the tax hurts the state’s aviation system by reducing the number of based aircraft at Kentucky airports—which results in a loss of jobs, revenue, grant funding opportunities, and other taxable income. 

No vote was taken on the February 15 hearing, though the bill may be reassigned to the Kentucky House Appropriations and Revenue Committee for further hearings and a possible vote.