AN ACT relating to public schools, making an appropriation therefor, and declaring an emergency.

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AN ACT relating to public schools, making an appropriation therefor, and declaring 1
an emergency. 2
Be it enacted by the General Assembly of the Commonwealth of Kentucky: 3
Section 1. KRS 157.615 is amended to read as follows: 4
As used in KRS 157.611 to 157.640, unless the context requires otherwise: 5
(1) "Available local revenue" means the sum of the school building fund account 6
balance; the bonding potential of the capital outlay and building funds; and the 7
capital outlay fund account balance on June 30 of odd -numbered years. These 8
accounts shall be as defined in the manual for Kentucky school financial accounting 9
systems; 10
(2) "Board of education" means the governing body of a county school district or an 11
independent school district; 12
(3) "Bonds" or "bonds of the commission" means bonds issued by the commission, or 13
issued by a city, county, or other agency or instrumentality of the Board of 14
Education, in accordance with KRS Chapter 162, payable as to principal and 15
interest from rentals rece ived from a board of education or from the department 16
pursuant to a lease or from contributions from the commission, and constitute 17
municipal bonds exempt from taxation under the Constitution of the 18
Commonwealth; 19
(4) "Department" means the State Department of Education; 20
(5) "District technology plan" means the plan developed by the local district and the 21
Department of Education and approved by the Kentucky Board of Education upon 22
the recommendation of the Council for Education Technology; 23
(6) "Equivalent tax rate" means the rate which results when the income from all taxes 24
levied by the district for school purposes is divided by the total assessed value of 25
property plus the assessment for motor vehicles certified by the Department of 26
Revenue as provided by KRS 160.470; 27
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(7) "Kentucky Education Technology System" means the statewide system set forth in 1
the technology master plan issued by the Kentucky Board of Education with the 2
recommendation of the Council for Education Technology and approved by the 3
Legislative Research Commission; 4
(8) "Lease" or "lease instrument" means a written instrument for the leasing of one (1) 5
or more school projects executed by the commission as lessor and a board of 6
education as lessee, or executed by the commission as lessor and th e department as 7
lessee, as the case may be; 8
(9) "Lease/purchase agreement" means a lease between the school district or the 9
department and a vendor that includes an option to purchase the technology 10
equipment or software at the end of the lease period; 11
(10) "Percentage discount" means the degree to which the commission will participate in 12
meeting the bond and interest redemption schedule required to amortize bonds 13
issued by the commission on behalf of a local school district; 14
(11) "Project" means a defined item of need to construct new facilities or to provide 15
major renovation of existing facilities which is identified on the priority schedule of 16
the approved school facilities plan; 17
(12) "School facilities plan" means the plan developed pursuant to the surve y specified 18
by KRS 157.420 and by administrative regulations of the Kentucky Board of 19
Education; 20
(13) "Technology master plan" means the long -range plan for the implementation of the 21
Kentucky Education Technology System as developed by the Council for Education 22
Technology and approved by the Kentucky Board of Education and the Legislative 23
Research Commission; 24
(14) "Traditional school building" means a school building where regular instruction 25
occurs for the general education of students and does not include facilities that 26
are solely used to provide specialized instruction or programming to students; 27
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(15) "Unmet facilities need" means the total cost of new construction and major 1
renovation needs as shown by the approved school facilities plan less any availa ble 2
local revenue; 3
(16)[(15)] "Unmet technology need" means the total cost of technology need as shown 4
by the approved technology plan of the local district; and 5
(17)[(16)] "Eligible district" means any local school district having an unmet facilities 6
need, as defined in this section, in excess of one hundred thousand dollars 7
($100,000) or a district qualifying for education technology funding. 8
Section 2. KRS 157.621 is amended to read as follows: 9
(1) In addition to the levy required by KRS 157.440(1)(b) to participate in the Facilities 10
Support Program of Kentucky, local school districts that have made the levy 11
required by KRS 157.440(1)(b) are authorized to levy the following additional 12
equivalent rates to support debt se rvice, new facilities, or major renovations of 13
existing school facilities, which levies shall not be subject to recall under any 14
provision of the Kentucky Revised Statutes, or to voter approval under the 15
provisions of KRS 157.440(2): 16
(a) 1. Prior to April 24, 2008, local school districts that have experienced 17
student population growth during a five (5) year period may levy an 18
additional five cents ($0.05) equivalent rate for debt service and new 19
facilities. The tax rate levied by the district under this provision shall not 20
be equalized by state funding, except as provided in paragraph (b) of 21
this subsection. Any levy imposed under this paragraph prior to April 22
24, 2008, by a local school district shall continue until removed by the 23
local school district. 24
2. A local school district shall meet the following criteria in order to levy 25
the tax provided in subparagraph 1. of this paragraph: 26
a. Growth of at least one hundred fifty (150) students in average 27
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daily attendance and three percent (3%) overall growth for t he five 1
(5) preceding years; 2
b. Bonded debt to the maximum capability of at least eighty percent 3
(80%) of capital outlay from the Support Education Excellence in 4
Kentucky funding program, all revenue from the local facility tax, 5
and all receipts from state equalization on the local facility tax; 6
c. Current student enrollment in excess of available classroom space; 7
and 8
d. A local school facility plan that has been approved by the 9
Kentucky Board of Education and certified to the School Facilities 10
Construction Commission; 11
(b) 1. In addition to the levy authorized by paragraph (a) of this subsection, a 12
local school district may levy an additional five cents ($0.05) equivalent 13
rate under the same terms and conditions established by paragraph (a) of 14
this subsection beginning in fiscal year 2003 -2004 if the levy was made 15
prior to April 24, 2008, and if the local school district: 16
a. Levied the five cents ($0.05) equivalent rate authorized by 17
paragraph (a) of this subsection; and 18
b. Still meets the requirements established by paragraph (a)2. of this 19
subsection. 20
2. Any school district that imposes both the levy authorized by paragraph 21
(a) of this subsection and the additional levy authorized by subparagraph 22
1. of this paragraph shall r eceive equalization funding from the state for 23
the levy imposed by paragraph (a) of this subsection beginning in fiscal 24
year 2003 -2004. Equalization shall be provided at one hundred fifty 25
percent (150%) of the statewide average per pupil assessment, subjec t to 26
the provision of funding by the General Assembly. Equalization funds 27
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shall be used as provided in KRS 157.440(1)(b). 1
3. Any levy imposed under this paragraph prior to April 24, 2008, by a 2
local school district shall continue until removed by the local school 3
district; and 4
(c) 1. A local school district that meets the following conditions may levy an 5
additional five cents ($0.05) equivalent rate on and after April 24, 2008: 6
a. The local school district is located in a county that will have more 7
students as a direct result of the new mission established for Fort 8
Knox by the Base Realignment and Closure (BRAC) 2005 issued 9
by the United States Department of Defense pursuant to the 10
Defense Base Closure and Realignment Act of 1990, Pub. L. No. 11
100-526, Part A of Title XXIX of 104 Stat. 1808, 10 U.S.C. sec. 12
2687 note; and 13
b. The commissioner of education has determined, based upon the 14
presentation of credible data, that the projected increased number 15
of students is sufficient to require new facilities or the ma jor 16
renovation of existing facilities to accommodate the new students, 17
and has approved the imposition of the additional levy. 18
2. Any local school district that imposes both the levy authorized by 19
paragraph (a) of this subsection and the additional levy au thorized by 20
subparagraph 1. of this paragraph, and that has not received equalization 21
funding under subsection (2) or (3) of this section, shall receive 22
equalization funding from the state for the levy imposed by paragraph 23
(a) of this subsection beginning in the fiscal year following the fiscal 24
year in which the levy authorized by subparagraph 1. of this paragraph 25
is imposed. Equalization shall be provided at one hundred fifty percent 26
(150%) of the statewide average per pupil assessment, subject to the 27
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provision of funding by the General Assembly. Equalization funds shall 1
be used as provided in KRS 157.440(1)(b). 2
3. Any levy imposed under this paragraph by a local school district shall 3
continue until removed by the local school district. 4
(d) 1. A local schoo l district may levy an additional five cents ($0.05) 5
equivalent rate beginning August 1, 2026, that shall not be subject to 6
recall, if the local school district: 7
a. Either has a: 8
i. Local school facility plan under this section as of 9
December 31, 2025, tha t contains a traditional school 10
building designated as a transitional center under KRS 11
157.420 and the plan indicates the consolidation of that 12
traditional school building into another school; or 13
ii. Traditional school building with an average daily 14
attendance of fewer than one hundred fifty (150) students 15
for at least three (3) consecutive years and has complied 16
with subsection (3) of Section 3 of this Act by either 17
submitting a school facility plan that closes and 18
consolidates that traditional school buil ding with another 19
facility or modifying the district's attendance areas to raise 20
that traditional school building's average daily attendance 21
above two hundred (200) students; 22
b. Has not authorized more than two (2) of the levies established 23
under: 24
i. Subsection (1)(a) of this section; 25
ii. Subsection (1)(b) of this section; 26
iii. Subsection (1)(c) of this section; 27
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iv. Subsection (2) of this section; or 1
v. KRS 157.440(1)(b); and 2
c. Has insufficient bonding capacity to either: 3
i. Improve the facility into whic h the traditional school 4
building will be consolidated under subparagraph a.i. of 5
this paragraph; or 6
ii. Improve the facility or facilities necessary to carry out 7
subparagraph a.ii. of this paragraph. 8
2. A local school district that has authorized the levy in subparagraph 1. 9
of this paragraph may levy an additional five cents ($0.05) equivalent 10
rate that shall not be subject to recall beginning August 1, 2027, if the 11
local board of education adopts a resolution determining that the levy 12
raised under subparagraph 1. of this paragraph is insufficient to: 13
a. Improve the facility into which the traditional school building 14
will be consolidated under subparagraph 1.a.i. of this paragraph; 15
or 16
b. Improve the facility or facilities necessary to carry out 17
subparagraph 1.a.ii. of this paragraph. 18
3. Any levy established under subparagraph 1. or 2. of this paragraph 19
shall expire after twenty-five (25) years. 20
4. Any levies authorized by subparagraphs 1. and 2. of this paragraph 21
shall receive equalization funding from the state. Equalization shall be 22
provided at one hundred fifty percent (150%) of the statewide average 23
per pupil assessment, subject to the provision of funding by the 24
General Assembly. Equalization funds shall be used as provided in 25
KRS 157.440(1)(b). 26
5. Equalization provided under subparagraph 4. of this paragraph shall 27
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be suspended for a school district if, after five (5) years from the 1
substantial completion of renovation or construction of a new 2
traditional school building, the school district has fail ed to consolidate 3
and close the existing traditional school building or modify the 4
district's attendance areas to raise the existing traditional school 5
building's average daily attendance above two hundred (200) students. 6
The suspension of equalization sha ll continue until the failure is 7
corrected. 8
(2) (a) Any local school district that, prior to April 27, 2016, levied an equivalent rate 9
that: 10
1. Was subject to recall at the time it was levied; and 11
2. Included a rate of at least five cents ($0.05) equivalen t rate for the 12
purpose of debt service for school construction or major renovation of 13
existing school facilities; 14
shall be eligible for retroactive equalization from the state for that levy at one 15
hundred fifty percent (150%) of the statewide average per pupil assessment 16
beginning in fiscal year 2003 -2004, subject to the fiscal condition of the 17
Commonwealth and the provision of funding by the General Assembly. 18
Equalization funds shall be used as provided in KRS 157.440(1)(b). 19
(b) It is the intent of the Ge neral Assembly that for levies described in this 20
subsection that are imposed on or after April 27, 2016, equalization funds, if 21
provided by the General Assembly, shall terminate upon the earlier of June 22
30, 2038, or the date the bonds for the local school district supported by this 23
equalization funding are retired. Equalization shall be subject to the fiscal 24
condition of the Commonwealth and the provision of funding by the General 25
Assembly. 26
(3) Any local school district that: 27
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(a) Levied an equivalent tax ra te as of April 24, 2008, that included at least ten 1
cents ($0.10) that was devoted to building purposes, or that had debt service 2
corresponding to a ten cents ($0.10) equivalent rate; 3
(b) Did not receive equalized growth funding pursuant to subsection (1)( b)2. of 4
this section; and 5
(c) Has been approved by the commissioner of education; 6
shall be eligible for equalization from the state for that levy at one hundred fifty 7
percent (150%) of the statewide average per pupil assessment beginning in fiscal 8
year 20 05-2006, subject to the provision of funding by the General Assembly. 9
Equalization funds shall be used as provided in KRS 157.440(1)(b). Equalization 10
funds shall be available to a local school district pursuant to this subsection until the 11
earlier of June 30, 2038, or the date the bonds for the local school district supported 12
by this equalization funding are retired. 13
(4) (a) Notwithstanding any other provision of this section, any local school district 14
receiving equalization funding prior to April 27, 2016, related to an equivalent 15
rate levy described in subsection (1), (2), (3), or (5) of this section shall 16
continue to receive the equalization funding related to the applicable 17
equivalent rate levy, subject to the limitations established by subsections (1), 18
(2), (3), and (5) of this section, and subject to the fiscal condition of the 19
Commonwealth and the provision of funding by the General Assembly, until 20
amended by subsequent action of the General Assembly. A local school 21
district described in this paragraph shall not be eligible to receive equalization 22
for any additional equivalent rate levies made by it on or after April 27, 2016. 23
(b) Notwithstanding any other provision of this section, any local school district 24
that has imposed an equivalent rate levy desc ribed in subsection (1)(a) or (b) 25
or (2) of this section prior to April 27, 2016, that qualifies for equalization but 26
that has not yet received equalization funding shall be eligible for equalization 27
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funding as provided in subsection (1)(a) or (b) or (2) o f this section, subject to 1
the provision of funding by the General Assembly. 2
(c) On and after April 24, 2008, a local school district not included in paragraph 3
(a) or (b) of this subsection shall be prohibited from imposing an equivalent 4
rate levy under th e provisions of subsection (1)(a) or (b) of this section, and 5
shall not be eligible for equalization funding under the provisions of this 6
section. 7
(d) On and after April 24, 2008, a local school district meeting the requirements 8
of subsection (1)(c) of thi s section may impose the levy authorized by 9
subsection (1)(c) of this section, and shall qualify for equalization as provided 10
in subsection (1)(c) of this section, subject to the provision of funding by the 11
General Assembly. 12
(5) (a) Any local school district that: 13
1. Had school facilities classified as Category 5 on May 18, 2010, by the 14
Kentucky Department of Education; and 15
2. Levied an additional five cents ($0.05) equivalent tax rate prior to April 16
27, 2016, for debt service, new construction, and major r enovation 17
beyond the five cents ($0.05) equivalent tax rate required by KRS 18
157.440(1)(b), except as provided in paragraph (b) of this subsection; 19
shall be eligible for equalization from the state for that levy at one hundred 20
fifty percent (150%) of the s tatewide average per pupil assessment beginning 21
in the fiscal year following the fiscal year in which the levy was imposed. 22
This levy shall be subject to the recall provisions of KRS 132.017. 23
(b) School districts that levied a five cents ($0.05) equivalent tax rate for debt 24
service, new construction, and major renovation, beyond the rate required by 25
KRS 157.440(1)(b) prior to May 18, 2010, shall not be required to levy an 26
additional tax to receive the equalization funds provided in paragraph (a) of 27
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this subsection. 1
(c) Any local school district receiving equalization under this subsection shall 2
receive full calculated equalization until the earlier of twenty (20) years 3
after the effective date of this Act, or the date the bonds for the local school 4
district supported by this equalization are retired [If the school district 5
utilizes the equalization funds to support a bond issue for construction 6
purposes, equalization funds shall be provided until the earlier of twenty (20) 7
years or date the bonds are retired]. 8
(d) In the event that a school district receives funding pursuant to this subsection 9
to support construction of a new school facility and subsequently, as a result 10
of litigation, receives funding for the same facility for which state funds were 11
provided, that school district shall reimburse the Commonwealth an amount 12
equal to the amount provided under paragraph (a) of this subsection. Any 13
funds received in this manner shall be deposited in the budget reserve trust 14
fund account established in KRS 48.705. 15
Section 3. KRS 160.290 is amended to read as follows: 16
(1) Each board of education shall have general control and management of the public 17
schools in its district and may establish schools and provide for courses and other 18
services as it deems necessary for the promotion of education and the general health 19
and welfare of pupils, consistent with the administrative regulations of the 20
Kentucky Board of Education. Each board shall have control and management of 21
all school funds and all public school property of its district and may use its funds 22
and property to promote public education. Each board shall exercise generally all 23
powers prescribed by law in the administration of its public school system, appoint 24
the superintendent of schools, and fix the compensation of employees. 25
(2) Each board shall make and adopt, and may amend or repeal, rules, regulations, and 26
bylaws for its meetings and proceedings for the management of the schools and 27
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school property of the district, for the tr ansaction of its business, and for the 1
qualification and duties of employees and the conduct of pupils. The rules, 2
regulations, and bylaws made by a board of education shall be consistent with the 3
general school laws of the state and shall be binding on th e board of education and 4
parties dealing with it until amended or repealed by an affirmative vote of a 5
majority of the members of the board. The rules, regulations, and bylaws shall be 6
spread on the minutes of the board and be open to the public. The rules, regulations, 7
and bylaws may include the use of reverse auctions as defined in KRS 45A.070 in 8
the procurement of goods and leases. 9
(3) A board that maintains a traditional school building as defined in Section 1 of 10
this Act with an average daily attendance of fewer than one hundred fifty (150) 11
students for at least three (3) consecutive years shall, at the next required revision 12
of the school facility plan: 13
(a) Submit a school facility plan under Section 2 of this Act that closes and 14
consolidates that traditional school building with another facility; or 15
(b) Modify the district's attendance areas to raise that traditional school 16
building's average daily attendance above two hundred (200) students. 17
(4) Local boards of education electing to enter into agreements pursuant to the 18
Interlocal Cooperation Act, KRS 65.210 to 65.300, with other local boards of 19
education to establish consortia to pro vide services in accordance with the 20
Kentucky Education Reform Act of 1990, 1990 Ky. Acts Ch. 476, may transfer real 21
or personal property to the consortia without receiving fair market value 22
compensation. The joint or cooperative action may employ employee s transferred 23
from employment of a local board of education, and the employees shall retain their 24
eligibility for the Kentucky Teachers' Retirement System. The chief state school 25
officer, under administrative regulations of the Kentucky Board of Education, may 26
allot funding to an interlocal cooperative board created by two (2) or more local 27
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school districts pursuant to KRS 65.210 to 65.300 to provide educational services 1
for the mutual advantage of the students in the representative districts. All statutes 2
and administrative regulations that apply to the use of these funds in local school 3
districts shall also apply to cooperative boards. 4
Section 4. There is hereby appropriated General Fund moneys in the amount of 5
$3,500,000 in each fiscal year of the 2026-2028 fiscal biennium to the Support Education 6
Excellence in Kentucky (SEEK) program budget unit to be distributed to school districts 7
for the equalization of taxes levied under subsection (1)(d) of Section 2 of this Act. 8
Section 5. Whereas it is critical to ensure that Kentucky school districts can 9
efficiently reorganize the schools operating within the districts in the next fiscal year, an 10
emergency is declared to exist, and this Act takes effect July 1, 2026. 11