10/25/2026
Legislative Update
By: State Representative Jennifer Henson Decker
Primary and Secondary Education Funding
Every Kentucky taxpayer, every Kentucky resident, every business in the Commonwealth, and every parent, grandparent, guardian, student, teacher, administrator, and school staff member has a stake in how Kentucky funds and governs its public schools. For families to excel and the state to prosper, K-12 education must be a priority. It is.
My Record on Public Schools & Funding
I greatly respect people who make a career of public education. The work is important and demanding. My commitment to Shelby County Public Schools is not a mere talking point. My volunteer work in our schools and my work in the General Assembly show my consistent dedication to quality public education.
I attended public schools, as did my children. Both of my parents taught in them, and my mother made a career there. Our five grandchildren are enrolled in the public school system now or soon will be. I was elected nine times as a parent representative on school-based decision-making (SBDM) councils. I have asked to serve on House education committees every year since taking office in the House in 2021.
Since then, the General Assembly has raised K-12 funding to record amounts and made substantial payments to stabilize the teachers’ pension system, which was dangerously underfunded before Republicans took control of the House. Last session, I helped secure $2 million for our district’s vocational education program that starts in middle school.
K-12 Funding: The Largest Share of a Finite Fund
If you want to know what a legislature values, look at the budget it passes. Since 2021, the General Assembly has funded state needs from a finite General Fund—taxpayer dollars, not a bottomless account in Frankfort. Unlike Washington, Kentucky cannot print money or pass an unbalanced budget.
During the 2026 Regular Session, executive-branch General Fund appropriations were set at approximately $15.4 billion for FY 2026–27 and $15.7 billion for FY 2027–28. The Medicaid Benefits budget alone received about $6 billion in General Fund appropriations over the biennium, in addition to federal and restricted funding. (Since 2013, Kentucky has experienced among the nation’s largest percentage increases in combined Medicaid and Kentucky Children’s Health Insurance Program (KCHIP) enrollment.)
The General Fund also supports state police and prisons, child protection, pensions, veterans’ homes, prosecutors, and other state responsibilities. Every proposed new program or additional appropriation must be weighed against these existing commitments.
SEEK—Support Education Excellence in Kentucky, the main per-pupil formula for local districts—was allocated more than $7 billion from the General Fund over two years. The budget raises the per-pupil guarantee from $4,586 in FY 2025–26 to $4,626 in FY 2026–27 and $4,792 in FY 2027–28. A district’s actual payment will still depend on enrollment and attendance, so it can rise or fall even though the per-pupil base guarantee increases.
With universities, KCTCS, and student aid, public education is the primary budget priority, and funding for kindergarten through 12th grade is the single largest General Fund category. Every increase must be weighed against other state responsibilities, including but not limited to meeting the needs of hospitals, foster children, troopers, and retirees.
K-12 Allocations
The General Assembly aims funding as close to students as possible. The most recent budget:
• Provides more than $7 billion in SEEK General Fund over two years and raises the base guarantee to $4,626 and then $4,792, with district amounts still varying by enrollment and attendance
• Holds pupil transportation at $398.9 million each year
• Increases General Fund allocations by $61.51 million in FY 27 and $73.36 million in FY 28 for full statutory Teachers’ Retirement System on-behalf payments
• Increases General Fund allocations by $128.3 million in FY 27 and $211.9 million in FY 28 to pay the full actuarially determined contribution each year
• Uses $3.99 million in excess FY 27 funding and increases General Fund allocations by $12.41 million in FY 27 and $28.20 million in FY 28 for a portion of medical insurance for new retirees under 65
• Carries forward $98.3 million from FY 26 into FY 27 and increases General Fund allocations by $201 million in FY 28 to fully fund health insurance on behalf of local school district employees
• Increases Restricted Funds by $900,000 in FY 27 and $1.7 million in FY 28 to update and maintain the Pathway system
• Increases General Fund allocations by $47.22 million in FY 27 for the 2024–2026 SEEK employer match deficit
• Increases General Fund allocations by $191,800 in FY 27 and $334,400 in FY 28 for legacy benefits
Putting Education Spending in Perspective
The same General Fund that covers K-12 education also keeps courthouses open in all 120 counties. House Bill 504 provides General Fund appropriations of $480.7 million in FY 27 and $497.7 million in FY 28 for the Court of Justice—$344.4 million and $348.5 million for operations, and $136.3 million and $149.2 million for judicial facilities. That includes $5 million each year to pay for more judges and the same 2 percent salary increment other state employees receive. While the Judicial Branch budget represents a real commitment to proper funding, it is a fraction of the amounts appropriated for K-12 education and for Medicaid.
House Bill 503 provides General Fund appropriations for the branch that writes state budgets: $90.1 million in FY 27 and $92.7 million in FY 28, including the General Assembly, the Legislative Ethics Commission, and the Legislative Research Commission. Printed distribution of the Legislative Record ended July 1, 2026. The record is now updated in near real time at legislature.ky.gov. The legislative branch’s General Fund appropriations are less than one percent of the executive branch’s General Fund appropriations. It is not a hidden claim on the school dollar; it is the small appropriation that allows the body that sets all state budgets to do its work.
Who Pays for Kentucky’s Schools
Critics often say the legislature “fails to fully fund the schools.” In 1990—before Republicans held the majority—Governor Wallace Wilkinson and the General Assembly created today’s state-local partnership after the 1989 Kentucky Supreme Court decision in Rose v. Council for Better Education. The Kentucky Education Reform Act (KERA) established SEEK and restructured Kentucky’s school funding system. Today, state sources provide the largest individual share of total public-school revenue, while local and federal sources provide the remainder. To participate in SEEK, local districts must meet a minimum local tax effort, which may be raised through a combination of authorized taxes. Local school boards levy these taxes under authority granted by state law. These local revenues are also taxpayer dollars.
In Kentucky, taxpayer dollars fund the education of most K-12 students. According to National Center for Education Statistics data for the 2021–22 school year, about 91% of Kentucky’s students enrolled in public or private K-12 schools attended public schools, while about 9% attended private schools. (These figures compare kindergarten-through-12th-grade public and private enrollment, excluding prekindergarten and homeschooled students.)
According to the National Center for Education Statistics as reported by USAFacts, in the 2023–2024 school year (the most recent year of available data) about 45.7% of Kentucky public school funding came from state sources, 36.8% from local sources, and the remaining 17.5% from federal sources. Altogether, public schools in Kentucky received $11.2 billion in funding, or $17,000 per student.
Any money received by Kentucky from the federal government also consists of taxpayer dollars. Federal funds arrive mainly as targeted grants rather than general operating funds. Major recurring sources include Title I of the Elementary and Secondary Education Act, which assists schools serving low-income students; the Individuals with Disabilities Education Act (IDEA), which supports special education; and U.S. Department of Agriculture school meal reimbursements. Federal funding adds billions to public schools nationwide, including roughly $2 billion in Kentucky in the 2023–2024 school year. Many federal education programs, including Title I and IDEA, have requirements designed to supplement rather than replace state and local support; the specific rules vary by program.
Who Decides Teacher Pay
A separate complaint—that the legislature provides “no money for teacher raises”—concerns both the amount of state funding available for raises and the respective roles of the General Assembly and local school boards in teacher compensation.
Understanding these respective roles begins with who employs teachers and sets their compensation. Local districts employ teachers. Superintendents make personnel appointments under state law, school boards establish district salary schedules, and principals evaluate teachers.
The General Assembly does not hire or fire individual teachers and ordinarily leaves district salary schedules to local boards. It can, however, require or fund salary increases. Its funding role includes appropriating SEEK funds and making on-behalf payments for Teachers’ Retirement System contributions and employee health insurance.
Within applicable state requirements, local school officials determine how best to compensate district teachers through locally adopted salary schedules. As a result, two districts can receive similar SEEK increases and still choose different raises, hiring freezes, or administrative spending. On-behalf payments cover costs the district would otherwise pay itself, freeing local funds for salaries if the board so chooses.
The General Assembly can increase the dollars that reach districts and establish limits on administrator raises. The budget passed in 2026 raised the SEEK guarantee to $4,626 and $4,792 and provides more than $7 billion in SEEK funding over two years.
Senate Bill 2 generally limits superintendent and administrator percentage pay increases by reference to classroom teacher raises, subject to the law’s exceptions and waiver provisions. For superintendent contracts, renewals, or extensions entered into on or after July 1, 2026, the limit is tied to the average percentage pay increase provided to classroom teachers in the district. The law also permits negotiation of an increase at contract expiration. For other administrators, exceptions include professional advancement involving a significant change in duties and responsibilities or a uniform pay increase for a job category. The law also provides a process for requesting waivers.
We have funded raises for state employees—people the Commonwealth actually employs. Additional state funding helps districts provide teacher raises. Local boards should determine teacher compensation through district salary schedules, consistent with applicable legal requirements.
Closing
Kentucky’s public schools are a top priority for the Kentucky General Assembly and for me. My years as a parent, volunteer, SBDM parent representative, taxpayer, and legislator have given me an appreciation of the many stakeholders and the practical challenges of school funding. I continue to build on that experience so I can better understand the often-competing interests of everyone involved, and I remain focused on school issues, including funding and the adequacy of the statutes that govern schools.
As always, feel free to reach out to me anytime. You can call the toll-free line in Frankfort at 1-800-372-7181, email me at [email protected], or check updates at legislature.ky.gov.
