Three years ago, Kentucky Secretary of State Trey Grayson (R) gave what some called the defining speech of his young political career at the annual Fancy Farm picnic and political showcase in the rural western part of the state.

In that 2006 speech, Grayson surprised many Bluegrass State political types and made national headlines by criticizing the state’s sitting Republican governor — who was under indictment on charges of rewarding political backers with state jobs — and announcing that he was considering throwing his hat into the gubernatorial primary.

A week later, the state’s most influential Republican, now-Senate Minority Leader Mitch McConnell (R), added a healthy amount of credibility to Grayson’s ambition when he announced he would attend a fundraiser for Grayson.

Three years later, Grayson has another opportunity to define himself at the 2009 Fancy Farm picnic set for this weekend.

After months of being half in and half out of the 2010 Senate race, Grayson has the opportunity to make this year’s Fancy Farm picnic his official coming-out party.

The 37-year-old secretary of state is now the frontrunner for the Republican Senate nomination after Sen. Jim Bunning (R-Ky.) announced Monday that he will retire at the end of his term.

Fancy Farm “is an important speech for Trey because a lot of people know him but they don’t yet know him in the context of being a federal candidate,— Kentucky Republican strategist Scott Jennings said. “This is Trey’s opportunity to show people what kind of conservative he really is on federal issues,— especially spending, health care and energy, which will dominate the 2010 campaign.

And as Grayson embarks on what is expected to be a tough open-seat fight next year, McConnell’s presence can be felt once again in Grayson’s ambition.

Grayson is a former estate planner and corporate attorney whose first run for political office was in 2003 when he was elected as the youngest secretary of state in the nation.

That year, Republicans — led by McConnell — ran on a message of cleaning up the state capital in Frankfort after the “mess— created by scandal-plagued Gov. Paul Patton (D).

To get a sense of just how much influence McConnell has over GOP politics in the Bluegrass State, one simply needs to know that the Kentucky Republican Party is headquartered in the Mitch McConnell Building in Frankfort.

During his first term as secretary of state, Grayson worked hard to establish himself as a Republican leader who would travel anywhere in the state to meet with Republican groups large and small, one senior GOP aide said Wednesday.

And his efforts and energy caught the eye of McConnell.

“Trey has always had a lot of ambition, and ambition is something Sen. McConnell admires,— the GOP aide said.

That admiration led McConnell to lend Grayson some big name credibility by getting behind his gubernatorial ambitions in 2006.

At the time, Patton’s successor, former Rep. Ernie Fletcher (R), was under fire for his own ethical issues, and many top Republicans in the state were looking for another candidate to replace him in the 2007 election.

In the end, Grayson backed away from the gubernatorial primary and chose to seek a second term as secretary of state.

He was re-elected with 57 percent of the vote while Fletcher lost the governor’s race by more than 18 points.

Coming off that victory, Grayson could count two statewide elections under his belt before he was 36 years old, and he was a bona fide rising star in Kentucky.

So when questions began to spring up in late 2008 over whether Bunning could hold the Senate seat in 2010, Grayson was a natural successor in the eyes of the state’s GOP establishment.

In April, Grayson announced he had formed an exploratory committee for the Senate race but also said he would not run against Bunning if he chose to seek re-election.

Whether it was out of strict political calculation or — as Bunning supporters suggest — a personal animosity toward the state’s junior Senator, McConnell did his part to get Bunning out of the race.

Publicly, McConnell signaled his desire for Bunning to step down by simply remaining silent whenever he was asked about the Senator’s re-election. However, Bunning has openly accused McConnell of sabotaging his fundraising efforts.

“I don’t think there’s any secret here that McConnell has been supportive [of Grayson] throughout this effort,— one Bluegrass State GOP consultant said this week.

But now that Grayson is in the race, McConnell’s most important support will come in the form of opening up his national fundraising network to the secretary of state.

Last year, McConnell raised about $20 million for his own re-election effort with more than two-thirds of that money coming from out of state.

“Now that Grayson is a candidate out on his own, I think it’s important to establish his own identity,— the consultant said. “I don’t think voters want somebody who is a clone of somebody else. For the purpose of establishing a political identity, you need to stand on your own two feet. … I think he has to establish an identity as a candidate who will listen to the grass roots.—

That’s certainly the identity that Grayson’s primary opponent, physician Rand Paul has been trying to establish. Paul, the son of Texas Rep. Ron Paul (R), will also be speaking at Fancy Farm this weekend.

“This venue is excellent, you’ve got statewide media there,— Jennings said. “If I were Trey Grayson, I’d want to walk away from Fancy Farm with all of the activists saying, Now that’s a conservative message I can get behind,’ and the media saying, This guy is the kind of guy that’s ready for prime time.’—