FCPS’ last two working budgets were $95 million below what was spent. Why? | Opinion

When the KERA legislation was passed in the early 1990s, it established the Office of Education Accountability to monitor operational issues and compliance with school related laws throughout the Commonwealth. From 1991 through 2001, I was contracted by that agency to assist in the efforts of forensic analyses of school districts including issues similar to the ones currently present in the Fayette County Public Schools. The issue of the various districts meeting the required fund balance reserves was a typical issue addressed by those reviews in many districts OEA staff visited.

But an equally important and related issue in those instances had to do with the validity and reliability of the financial and budgeting information being provided to the members of each district’s elected board members. While in a perfect world, each school board member should do an annual and ongoing deep dive into the financial matters of the district. However, as a practical matter, in a district in which the upper management of the district is being paid over $500,000 per year, it is also reasonable for the members of the board to be able to rely upon the information being put before them when it comes time each year to vote to approve or disapprove of the next year’s budget.

To satisfy my own curiosity related to the current issues surrounding the Fayette County budget process, I reviewed the final working budget approved for each of the last two fiscal years from July 1, 2023 through June 30, 2025 comparing the information presented to the board members for approval to the ultimate actual expenditures incurred by the district for each of those years. The result of that very basic analysis showed that in each of those two years, the board approved budgets that were materially below the actual expenditures incurred.

More specifically, the Board was presented working budget information for the 2023-2024 year that projected expenditures that were approximately $36 million dollars less than the total actually expended for that year. Likewise, for the 2024-2025 fiscal year, the Board was presented anticipated costs that turned out to be approximately $59 million less than what was actually spent. So for these last two fiscal years, the Board voted to approve final working budgets that presented projected costs that were some $95 million less than what was actually spent.

From the information that I have seen, the management of the district is excusing these overages by reference to inflation and pointing to the clean financial audits issued for the district each year. Clearly, the budgeting information provided each year should take inflation into account, as that information is well publicized on a monthly basis and well known.

If that type of information results in district officials having to make difficult operational decisions, so be it. That is why you do a budget in the first place. As to the financial audit not raising any questions of the type currently plaguing the district, it is simply not the purpose of the annual financial audit to address such issues, and to make that excuse is a distraction from the real issue.

Based upon this easily accessed basic information, a full forensic analysis of the district is certainly warranted. However, the board must vote to approve the final working budget currently being presented to them by the end of September, and no such forensic review can be completed in that time frame. The last thing the district and the public needs is for the Kentucky Department of Education to see the need to take over the daily operations of the school system. I would strongly encourage each board member to consider the pattern of information that has been presented to them over the most recent two fiscal years, and make a deep dive into the current information being presented to them before they make any such vote.

Calvin Cranfill CPA/ABV/CFF, is a former forensic budget for the Office of Educational Accountability and a certified public accountant.

This story was originally published September 10, 2025 at 2:30 PM.