Fayette County Public Schools will dip into its contingency fund to pay the rest of this year’s budget obligations, like bills and payroll.
That money is used as a safety net in order to cover emergency expenses.
That comes as the district is facing significant financial issues. Earlier this year, district officials revealed budget misreporting dating back to at least 2008. The district also reported a $16 million shortfall last year.
The amount currently in the district’s books for the 2025-2026 fiscal year’s contingency fund is $27 million, but district officials say that reported number is likely to change. FCPS is currently working to restate this year’s budget to be more accurate. In the meantime, it’s still not known how much of the contingency will be spent.
Amy Smith, the district’s Acting Executive Director of Financial Accounting and Benefits Services, said at a Monday meeting that FCPS expects to have a more accurate budget report next month, after this fiscal year ends at the end of June.
“It may not be 100% final, because we are going through the close of year in process throughout the month of July, which we have until July 25 to complete,” she said.
Smith estimated the district is around “95% completed” with restating the general fund, which makes up the largest amount of the budget. She also estimated the district is still “15-to-20% away” from restating its special revenues and grant reviews.
“We are working almost around the clock, because it really feels that way. We are working tirelessly to get this completed as soon as possible,” she said.
Kentucky state law requires school districts to keep contingency funds worth at least 2% of their total budgets. District finance officials have said next fiscal year’s budget includes a contingency fund of $11.4 million.
FCPS is also taking out a $95 million loan to meet payroll for staff at the start of next year. The district is eliminating 120 staff positions and is selling some surplus property in order to balance next year’s budget.
Last month, the district approved a tentative budget that includes $711 million for its general fund and $880 million in total.
