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The Commonwealth of Kentucky, that is to say the Governor and legislature of the time, decided to trademark the name Kentucky in order to bring in more revenue in 1990.

As all harebrained schemes start, some weasel down in accounting convinced the powers that be (again gov and reps who had the power to do this) that since the restaurant chain, the famous Horse Race, and the Bluegrass seed all used the name, they would be forced to pay whatever royalties the august body decided they should.

Again, as all the schemes go, the targeted entities simply chose to remove the name Kentucky from their products, thus denying the state of any and all usurped revenue IN ADDITION TO all the goodwill and free advertising these products already brought to the state. Now you almost never hear the word Kentucky in daily life.

In hindsight, it turned out to be a revenue loss for the state.

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Q: What year did the state of Kentucky decide to trademark their state name?
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