House panel approves fund transfer bill for local schools

February 24, 2009 | | Comments 2

FRANKFORT – School officials say a bill moving through the House could provide much-needed fiscal help for their ailing budgets.

A House budget panel on Tuesday passed a bill that would allow local school districts to use a portion of dollars earmarked for renovations or new construction to be transferred to classroom instruction or other uses.

A similar bill passed last year and 17 school districts are currently using some capital projects money for their general fund budget, state education officials said Tuesday. One school district has already applied to use the funds next year.

But the measure did not pass without some debate as legislators questioned how the program would be implemented and if federal stimulus money may help local school districts with shortfalls.

Paul Upchurch, superintendent of Oldham County Schools, said his school district would be able to use $1.2 million in capital project money – or $100 for each of its 12,000 students – to help plug holes in the district’s nearly $100 million budget. But that $1.2 million will not shore up its entire potential shortfall, Upchurch said.

Rep. Kent Stevens, D- Lawrenceburg, sponsor of House Bill 363, said the measure would only allow school districts to use the capital projects money for an additional two years. By that time, the economy will have improved and schools will not need to tap capital projects money, Stevens said.

The commissioner of the Department of Education would have discretion on whether the school systems could use those capital project funds, Stevens said.

Rep. Robin Webb, D-Grayson, questioned whether it was prudent for growing school districts to use capital project money for instructional uses. “It’s a slippery slope,” Webb said.

Upchurch said his district, which is outside of Louisville, receives about 500 new students every year. He, too, is concerned about using capital projects money for teacher’s salaries and other expenses. “It’s not that there isn’t a need, it’s just about setting priorities right now,” Upchurch said of capital projects.

Rep. Harry Moberly, D-Richmond, said school districts did not receive an increase in funding this year but their funding has remained flat, which translates to a cut because of increasing expenses.

“While these concerns expressed are legitimate I believe they are overridden by the need to keep up our instructional programs,” Moberly said.

Lisa Gross, a spokeswoman for the Kentucky Department of Education, said although staff have not discussed this bill specifically, the department in general has supported measures that give local school districts wider lee-way in the way they use their funds.

“We like flexibility and this does seem to allow for more flexibility for local districts,” Gross said.

The bill now goes to the full House for its consideration.

— Beth Musgrave

Filed Under: EducationFeaturedKY General AssemblyState Budget

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  1. John says:

    What is the bill number ???
    Sort of a crucial bit of info not included in the article !

  2. John says:

    whoops… found it.. sorry