Fayette schools budget could be squeezed by community college cuts

About 440 high school students in Fayette County take dual credit college courses at a cost to the school district of $50 per three-hour course or $60,000 per year.

But following cuts to higher education in the 2016-18 budgets, Fayette County school officials have been told that dual-credit fees charged to the district by Bluegrass Community and Technical College would rise to $220 per three-hour course, Hiren Desai, the Fayette County school district’s senior administrative services director, told school board members Thursday at a special budget meeting.

That could cost Fayette County Schools a minimum additional $200,000 in the 2016-2017 budget, Desai said.

The current agreement with Bluegrass has allowed for full tuition to be waived for the dual credit courses at Fayette County high schools with courses costing only a $50 administrative fee, he said. But only half of the tuition will be waived next year, Desai said.

Kentucky Education Commissioner Stephen Pruitt said in a recent message to state educators that he was trying to get clarification on the issue.

Mark Manuel, a spokesman for BCTC, confirmed the increase, and said the cost for a three-hour course may even be a few dollars higher, at $234.

The situation is one of several affecting Fayette County’s tentative budget for 2016-17, which must be approved in May, Desai and Budget Director Julane Mullins told the board. The Fayette County school board is expected to vote on the tentative budget Monday. A final budget will be approved in September.

Desai said the overall district budget for 2016-17 will be about $450 million, which is, at this point, is essentially flat from the year before.

As in the past few years, the Fayette school board will be asked to approve tax rates on real and personal property that generate a 4 percent increase in revenue. That is expected to generate $9.3 million for the school district.

Desai said he expects there will be some additional costs associated with Superintendent Manny Caulk’s entry plan of improvements, which Caulk is expected to announce soon. For now, Desai is setting aside $2 million.

It will cost $500,000 for the setup and installation of portables at various schools.

About $2 million will be set aside for startup funds for the new high school scheduled to open in the 2017-18 school year.

“I think this district is financially in good shape in the sense that we have growth, our revenue is increasing,” Desai said.

The district grows by 400 to 600 students each year.

But Desai wants the district’s contingency fund — or rainy day fund — to increase in the long term, from 5 percent to about 12 to 15 percent, or from $23 million to $55 million. That could improve the district’s credit rating, which could give it a better interest rate on construction projects, he said.

Currently, the district is still making tweaks to the 2015-16 budget, with staff asking school board members to set aside $470,00 for heating and air conditioning repairs.

In another matter with budget implications, Gov. Matt Bevin vetoed budget language that, for about the last 15 years, had allowed school districts to publish their financial reports on their websites instead of in newspapers.

Desai said the move would cost Fayette County Schools $35,000 in additional annual costs. Tom Shelton, executive director of the Kentucky Association of School Superintendents, estimated that statewide it “will take $2-$3 million from funds used to educate children causing it to be spent on printing costs.”

In the state budget, the total funding in the formula used to allocate state dollars to school districts was held constant to 2015-16.

In Fayette County, Desai said, “we do not anticipate any significant decrease” as a result of the state budget for fiscal year 2017, except for preschool funding.

Shelton said preschool funding across the state was affected because the allocation was reduced by $7.5 million.

This story was originally published May 21, 2016 at 3:29 PM with the headline "Fayette schools budget could be squeezed by community college cuts."