The city of Lexington has waived nearly $400,000 in building-permit fees and fines for the Fayette County Public Schools in a five-year period, including six different times when the school system never got a permit as required, according to city data.
The city has long waived such building permit fees for Fayette County Public Schools. Now, some council members are questioning whether that practice should continue.
The waiver of building permit fees cost the city $297,479. The city also waived fines typically levied against a builder for failing to pull a permit. In total fees and late fines, the city has not collected $396,102 the school system would have owed the city from 2012 to 2017.
At the same time, the school district also waives fees for the city — including $300,000 annually in rent for city-run after-school programs in Fayette County buildings.
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One Lexington-Fayette Urban County Council member said it may be time for the city to look at whether it should continue to waive those fees, given the school system’s history of failing to get a building permit.
“I think we’re the only city in the state that doesn’t charge the school system for building permits,” said Councilman Richard Moloney.
A subcommittee of the council has been formed to explore the relationship between the school system and the city. Moloney said Wednesday the subcommittee — which also includes school officials — will start meeting next week.
“We want to see how we can improve this relationship,” Moloney said. “There is always room for improvement. I want to make sure this is a fair partnership.”
Fayette County Public Schools Superintendent Manny Caulk said the school system looks forward to working with the new subcommittee and said it will work to correct any outstanding issues.
“If there have been missteps in the past, we will correct those issues going forward,” Caulk said. “We share a mission of public service and are excited to discover other areas of collaboration. Our entire community benefits when we work together.”
The issue of the city and school system’s financial relationship first came up at a council Budget, Finance and Economic Development Committee in late January.
“They are not exempt from building permits,” said Derek Paulsen, the city’s planning commissioner, during the meeting. “But by policy, they do not have to pay for the building permits.”
Paulsen said on at least six different occasions from 2012 to 2017 the school system started construction without getting a building permit. That’s a no-no that typically results in fines.
That happened in 2015 with Frederick Douglass High School on Winchester Road. The city ordered work to stop at the site after the school system failed to get a building permit at the time the school started construction. At the time, the school system said it was an oversight of the contractor.
The city did not name the other school building projects where the district failed to get a building permit before construction began.
Government bodies such as the school system are also exempt from zoning requirements, but school designs go through a review process, Paulsen said.
That’s important because of the amount of traffic around schools at peak times. Water run-off and drainage is another key issue that must be reviewed by planning staff.
During the Jan. 30 meeting, Paulsen said the school system waives some rental fees for the city. For example, the city leases Meadowbrook golf course from the school system for free. That property is worth $2.7 million, according to the Fayette County Property Value Administrator.
The school district also allows the city’s parks department to use its facilities to run after school programs. Rental fees for after-school programs the school system waives are $300,000 annually. The parks department also makes money off that program. The school system also waives rental fees for parks and recreation to use its football fields and gyms. The school charges the city for other uses such as rent for auditoriums for some parks programming. But the parks department also makes money off those events, according to data provided by the city.
Councilman Fred Brown said during the January meeting he wanted to look at the financial ties between the city and the school system and thought the subcommittee was a good idea.
“We probably need to look into this because a partnership goes both ways,” Brown said. “I haven’t been convinced that we are getting a partnership from the school side.”
Brown said he and other council members have in the past tried to reach out to principals and parent-teacher groups at some of the schools in their districts and have not always been successful.
Councilman Kevin Stinnett said although he agrees the relationship between the city and the public school system can be improved, each new school that opens also creates a lot of jobs, which benefits the city. The majority of the city’s general fund budget comes from taxes paid on wages.
“They are our second largest employer,” Stinnett said.
The University of Kentucky is not required to get building permits through the city. Those permits are issued through the state, said Paulsen. UK does pay other city-related fees for buildings, such as tap-on fees for water and sewer.