LEXINGTON, Ky. (LEX 18) — A community work group has recommended using the FCPS contingency fund to address the district's $16 million budget deficit rather than implementing a controversial occupational tax increase.
The work group, tasked with finding budget solutions, presented 10 recommendations during their final meeting Tuesday. Reducing the contingency fund ranked as their top preference.
"What happens if we don't have additional revenue and our expenditures continue to rise?" Deputy Superintendent Houston Barber asked during the meeting.
Barber warned that funding shortfalls would significantly impact the district, from layoffs, to class size ratios, support services and intervention programs.
Earlier this year, the Fayette County School Board faced major public outcry after voting to pass an occupational tax increase. However, the Attorney General ruled the vote was not legal due to insufficient advance notice, and the State Auditor promised to investigate the board's finances.
The school board had sought the increased tax revenue to cover the $16 million budget deficit, which they attributed to rising costs for insurance, utilities, infrastructure, and personnel, along with expired federal resources.
The work group, which has met throughout the summer, has recommended reducing the district's contingency fund from 6% to 4%. Their second choice would be taking the full $16 million from the current $42 million contingency fund, which is designated for one-time emergency expenses.
At least one participant expressed disappointment that this option wasn't considered before pursuing the tax increase.
"There were other solutions we didn't think of that were in the budget this whole time, so that's disappointing," the participant said.
The work group's complete list of recommendations, ranked from highest to lowest preference, includes:
- Reducing the district contingency fund from 6% to 4% of the total general fund budget
- Taking the full $16 million from the contingency fund
- Freezing spending on non-contractually obligated expenses
- Charging the district with making administrative cuts that don't impact teachers
- Continuing the program of administrative attrition
- Initiating sponsorship programs for specific programs and public-private partnerships
- Reducing maintenance costs by $1.7 to $2 million
- Liquidating real estate and other assets
- Reducing maintenance costs and increasing lunch pricing
- Raising the occupational license tax
The school board will now consider these recommendations on August 18.
