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The Lane Report

2006 Economic Outlook for Lexington is Very Good

As we start the new year, it's a good time to assess where Lexington is and what are its future opportunities. Lexington is very fortunate - many positive economic factors are working in its favor.

Population growth - over the last twenty-five years (1980-2005) Lexington's population growth has been steady and sustained. Population increased 36 percent, or on the average, about 1.46 percent per year.

Without erratic starts and stops, Lexington's steady population growth rate has been a long-term economic stimulus for the local economy. As new people move to Lexington, they create a demand for more housing and services. This growth is projected to continue and to be a positive influence for Lexington's business environment.

Retail Sales - Lexington is the major center of retail sales for central and eastern Kentucky. Many top local, regional and national retail chains serve the Central Kentucky trade area.

Retail sales in Fayette County increased from $3.13 billion in 1997 to an estimated $4.89 billon in 2005 - a $1.76 billion or 7.0 percent average annual increase. Estimated 2005 retail sales in Fayette County were 9.4 percent of all retail sales in Kentucky.

Lexington ranks 49 th in retail sales among cities nationally and is 64 th in population.

Agribusiness - Fayette continues to be one of Kentucky's leading countries for agricultural production. Sales of horses and cattle, at Keeneland, Fasig-Tipton and Blue Grass Stockyards, will exceed one billion dollars this year.

Educated Workforce - Fayette County has Kentucky's best educated workforce and its educational levels substantially exceed national averages for persons with high school, post-secondary and/or post-graduate degrees.

This quality workforce has been a major factor in attracting technology, manufacturing, business and professional services to Lexington. Companies providing these types of services offer high paying employment opportunities.

Commerce Lexington Inc. - Lexington's economic development efforts are coordinated and managed by Commerce Lexington. Having been created by the merger of several economic development entities in 2004, the ability of Commerce Lexington to help create new jobs in our community is becoming more focused, effective and successful.

Helping create high quality jobs and promoting Central Kentucky's attributes are important missions for Commerce Lexington that will help ensure the region's continued prosperity.

Healthcare Center - Healthcare facilities in Lexington are continually recognized for quality, outstanding service and innovation. Lexington's hospitals attract patients from a large regional area. Health services employment levels in Lexington are significantly higher than the national average.

UK Healthcare has announced a major expansion of hospital and research facilities. The new UK medical complex will cost $450 million and will be completed in 2010. Approximately 1500 new medical related jobs will be created.

University of Kentucky - Recent announcements about UK's business plan to achieve "Top 20" research university status will have a profound effect on Lexington, Central Kentucky and the state. Strategies in the "Top 20" plan call for increasing UK's enrollment by 7,000 students, recruiting 625 more professors, building more teaching and research facilities, expanding UK's annual research mission to over $700 million in expenditures, and helping create more new technology and entrepreneurial businesses.

All of these areas of activity will have a significant impact on Lexington's economy and help create employment opportunities for graduates of UK and nearby colleges and universities.

World Equestrian Games - Coming to the Kentucky Horse Park in 2010, WEG will have a major economic impact on Central Kentucky and the state's economy.

A significant amount of capital improvements will be constructed at the Kentucky Horse Park. The state, in preparation of the world games, will need to accelerate roadway improvements to meet the already growing traffic flows in the region.

The best benefits of the World Equestrian Games will be publicity, advertising and media attention directed to Kentucky, Lexington, and the equine industry. The residual value of the World Games will be a long term boost in activity at the Horse Park, the attraction of international visitors to Central Kentucky, and further confirmation of Lexington's leadership as the "Horse Capital of the World". These long term benefits may be greater than the immediate $300 million economic impact of the 14-day event.

The Forecast - The outlook for Lexington's economy during the next decade is positive and encouraging. Many components of Lexington's economy will be expanding and creating new job opportunities. Lexington's business, professional and civic leaders must encourage the leadership of the Urban County Government to efficiently manage the growth of our community, its infrastructure, and quality of life issues.

Lexington's anticipated success could be squandered if our political leaders do not have the discipline to reign in bureaucracy, to eliminate empire-building, and to demand strong management and in-depth due-diligence analysis in the operation and planning of government activities.

As your 12 th district councilmember, I will continue my efforts to bring leadership and sound business ideas to city government.

Your comments and suggestions are always appreciated.




If you would like to contact Ed Lane he can be reached via at EdLane@LFUCG.com ; and by letter at 200 East Main Street, Lexington, KY 40507.

Councilman Ed Lane represents the 12 th District on Lexington Urban County Council. He is the owner of a commercial real estate services firm and publishes a statewide business magazine.

“I want to conservatively spend our tax dollars,
eliminate waste, and bring sound business ideas
to local government.”

To contact Ed Lane's 12th district council offices, e-mail him at edlane@lfucg.com.