{"data":{"id":"us-ky/krs-157.420","jurisdiction":"us-ky","citation":"KRS 157.420","heading":"Restrictions governing expenditure of funds from public school fund -- Use","body":"of historic settlement school facilities -- Use of capital outlay funds after mid -\nyear adjustment -- Evaluation of school buildings.\nPublic school funds made available t o the credit of each district during any year shall be\nreceived, held, and expended by the district board, subject to the provisions of law and\nadministrative regulations of the Kentucky Board of Education. The following\nrestrictions shall govern the expenditure of funds from the public school fund:\n(1) The salary paid any rank of teachers shall be at least equivalent to the amount set\nforth in the biennial budget schedule for each rank and experience for a term of one\nhundred eighty-five (185) days for full-time service during the regular school year.\n(2) Beginning with the 2004 -2006 biennium, the Kentucky Board of Education shall\nnot approve any working budget or salary schedule for local boards of education for\nany school year unless the one hundred eight y-five (185) day salary schedule for\ncertified staff has been adjusted over the previous year's salary schedule by a\npercentage increase at least equal to the cost -of-living adjustment that is provided\nstate government workers under the biennial budget. Th e base funding level in the\nprogram for support education excellence in Kentucky as defined in KRS 157.320\nshall be increased by the statewide dollar value of the annual required cost-of-living\npercentage adjustment that shall be estimated on the sum of th e previous year's\nstatewide teachers' salaries.\n(3) A district that compensates its teachers or employees for unused sick leave at the\ntime of retirement, pursuant to KRS 161.155, may create an escrow account to\nmaintain the amount of funds necessary to pa y teachers or employees who qualify\nfor receipt of the benefit. The fund is limited to not more than fifty percent (50%) of\nthe maximum liability for the current year to be determined according to the\nnumber of staff employed by the district on September 1 5. Interest generated by the\naccount shall be calculated as part of the total amount. The funds shall not be used\nfor any purpose other than compensation for unused sick leave at the time of\nretirement and shall not be considered as part of the general fun d balance in\ndetermining available local revenue for purposes of KRS 157.620.\n(4) (a) The per pupil capital outlay allotment for each district from the public school\nfund and from local sources shall be kept in a separate account and may be\nused by the dis trict only for capital outlay projects approved by the\ncommissioner of education in accordance with requirements of law, and based\non a survey made in accordance with administrative regulations of the\nKentucky Board of Education. These funds shall be used for the following\ncapital outlay purposes:\n1. For direct payment of construction costs;\n2. For debt service on voted and funding bonds;\n3. For payment or lease -rental agreements under which the board\neventually will acquire ownership of a school plant;\n4. For the retirement of any deficit resulting from overexpenditure for\ncapital construction, if such deficit resulted from an emergency decla red\nby the Kentucky Board of Education under KRS 160.550; and\n5. As a reserve fund for the above -named purposes, to be carried forward\nin ensuing budgets.\n(b) A district may submit a request to the commissioner of education to use funds\nfrom the per pupil capital outlay allotment to purchase land for a new school\nor to modify an existing school if the project is included on the district facility\nplan for completion within eight (8) years. The land shall not be included in\nthe calculation of the school distr ict's unmet need. The commissioner may\ngrant or deny the district's request at his or her discretion.\n(c) A district which has experienced an increase in adjusted average daily\nattendance, as defined by administrative regulation, of twenty percent (20%)\nor more over a five (5) year period may submit a request to the commissioner\nof education to use capital outlay funds for the operation of a new school for\nthe first two (2) years following its opening. The commissioner may grant or\ndeny the district's request at his or her discretion.\n(d) A local school district may submit a request to the commissioner of education\nto use capital outlay funds for maintenance expenditures or for the purchase of\nproperty insurance without forfeiting the district's participatio n in the School\nFacilities Construction Commission program. Maintenance requests may\ninclude other priorities that are not considered major renovations, such as\nrepair, renovation, or system upgrades that are necessary to maintain the\nintegrity of an existing school facility.\n(5) The district may contribute capital outlay funds for energy conservation measures\nunder guaranteed energy savings contracts pursuant to KRS 45A.345, 45A.352, and\n45A.353. Use of these funds, provided in KRS 45A.353, 56.774, and 58. 600, shall\nbe based on the following:\n(a) The energy conservation measures shall include facility alteration;\n(b) The energy conservation measures shall be identified in the district's approved\nfacility plan;\n(c) The current facility systems are consuming excess maintenance and operating\ncosts;\n(d) The savings generated by the energy conservation measures are guaranteed;\n(e) The capital outlay funds contributed to the energy conservation measures shall\nbe defined as capital cost avoidance as provided in KRS  45A.345(2) and shall\nbe subject to the restrictions on usage as specified in KRS 45A.352(9); and\n(f) The equipment that is replaced shall have exceeded its useful life as\ndetermined by a life-cycle cost analysis.\n(6) If any district has a special levy for capital outlay or debt service that is equal to the\ncapital outlay allotment or a proportionate fraction thereof, and spends the proceeds\nof that levy for the above -named purposes, the commissioner of education under\nadministrative regulations of the Kent ucky Board of Education, may authorize the\ndistrict to use all or a proportionate fraction of its capital outlay allotment for\ncurrent expenses. However, a district which uses capital outlay funds for current\nexpenses shall not be eligible to participate i n the School Facilities Construction\nCommission funds, except when the current expenditures are approved by the\ncommissioner of education under subsection (4)(b) or (c) of this section.\n(7) If a survey shows that a school district has no capital outlay nee ds as shown in\nsubsection (4)(a)1., 2., 3., and 4. of this section, upon approval of the commissioner\nof education, these funds may be used for school plant maintenance, repair,\ninsurance on buildings, replacement of equipment, purchase of school buses, an d\nthe purchase of modern technological equipment, including telecommunications\nhardware, televisions, computers, and other technological hardware to be utilized\nfor educational purposes only.\n(8) In surveying the schools, the Department of Education shall designate each school\nfacility as a permanent, functional, or transitional center.\n(a) \"Permanent center\" means a center which meets the program standards\napproved by the Kentucky Board of Education, is located so that students are\nnot subjected to an excessive amount of time being transported to the site, and\nhas established an attendance area which will maintain enrollment at capacity\nbut will also avoid overcrowding.\n(b) \"Functional center\" means a center which does not meet all the criteria\nestablished for a permanent facility, but is adequate to meet accreditation\nprogram standards to insure no substantial academic or building deficiency.\nThe facility plan shall include additions and renovations necessary to meet\ncurrent accreditation standards for whic h federal, state, and local funds may\nbe used.\n(c) \"Transitional center\" means a center which the local board of education has\ndetermined shall no longer be designated permanent or functional. The center\nshall be destined to be closed and shall not be elig ible for new construction,\nadditions, or major renovation. However, the board of education shall\nmaintain any operating transitional center to provide a safe and healthy\nenvironment for students.\n(9) Beginning in fiscal year 2011 -2012, the Kentucky Departm ent of Education shall\nstandardize the process for evaluating the overall quality and condition of all school\nbuildings across the state. The evaluation process shall:\n(a) Result in consistent categorization of buildings for local planning purposes\nand for  the distribution of state general fund moneys designated for capital\nconstruction;\n(b) Be based on measurable, objective criteria;\n(c) Include numerical scoring with weights to recognize building components and\ncharacteristics that address:\n1. Life safety issues;\n2. Compliance with state and federal codes;\n3. Compliance with requirements under the Americans with Disabilities\nAct;\n4. Community spaces;\n5. Instructional areas;\n6. Mechanical, electrical, plumbing, and other technology systems;\n7. Site and exterior building conditions;\n8. Age of the buildings;\n9. Feasibility of building additions or major renovations;\n10. The districts' facility capacities;\n11. Current use of temporary facilities; and\n12. Projected enrollment growth; and\n(d) Use of a third -party evaluator that utilizes an already established software -\nbased system to perform the first, base-line evaluation.\n(10) The Kentucky Board of Education shall promulgate an admin istrative regulation\nupon recommendation of the Kentucky Department of Education and the School\nFacilities Construction Commission to implement subsection (9) of this section.\n(11) If a local school board authorized elementary, middle, or secondary educati on\nclasses in a facility of a historical settlement school on January 1, 1994, the board\nshall continue to use the facilities provided by the settlement school if the facilities\nmeet health and safety standards for education facilities as required by\nadministrative regulations. The local school board and the governing body of the\nsettlement school shall enter into a cooperative agreement that delineates the role,\nresponsibilities, and financial obligations for each party.\n(12) Notwithstanding the provisions  of subsections (4) and (6) of this section, a local\ndistrict that has requested a mid -year adjustment in the support education\nexcellence in Kentucky funding under KRS 157.360(16) may request permission\nfrom the commissioner of education to use capital ou tlay funds for the purchase of\nschool buses or to use the capital outlay funds for increased operational expenses\nfor the first three (3) years following the increased growth in the district without\nforfeiture of the district's participation in the School Facilities Construction\nCommission Program. The commissioner may grant or deny the district's request.","path":["KRS Chapter 157"],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=42373","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:51:02Z","sha256":"c3e16a27f50d78f27c98e26ea6fca6feaea9f4ad625520f6c32768f337010456","source_id":"us-ky","stale":false,"prev":"us-ky/krs-157.410","next":"us-ky/krs-157.430"},"notice":"GroundRules: Original legal text. Not legal advice."}