Analysis: Step 2 of the State Budget – How did education fare in the House’s budget proposal? – Prichard Committee for Academic Excellence
Prichard Committee for Academic Excellence

Analysis: Step 2 of the State Budget – How did education fare in the House’s budget proposal?

The Kentucky House of Representatives today adopted their version of the state’s spending plan for the next two years.  This is step two in the process of crafting the state budget. The proposal now moves to the state Senate for their modifications.

Adopted by a vote of 86 to 10, major elements of the House’s proposal include: investments to fully fund pensions, a 1 percent pay increase each year for public employees including teachers and school district staff, more than a 1 percent increase in the base SEEK per-pupil guarantee each year, significant new funding to hire more school counselors, increasing funding to colleges and universities to help off-set pension costs and invest in the performance-based funding formula, and increasing student financial aid — continuing a commitment to allocate 100 percent of lottery proceeds to scholarships.

These are all positive.  And after many years of budget reductions in critical areas of education, stable and even modest increases are a welcome sight. However, concerns remain about the lack of new revenue to sustain the scale of investments (see our Big bold Ask) necessary to ensure education excellence in Kentucky, from early childhood through postsecondary.

Early Childhood

Achieving high-quality early learning opportunities for all children requires additional investment. This is critical when almost 50 percent of our children enter kindergarten not ready to learn, and 50 percent of Kentucky families live in a childcare desert and quality childcare is either non-existent or unaffordable for working parents.  The House’s proposal is mixed, making progress on eligibility for critical program supports, if not with substantial new dollars.

  • Public Preschool – The House’s proposal increases the eligibility threshold for public preschool from 160 to 175 percent of the federal poverty level in the second year of the biennium – putting Kentucky farther along the path to reach the goal of 200 percent and of serving more families in need. Unfortunately, total funding for is reduced by $7.5 million in the first year with the removal of the Preschool Partnership grants – a positive support for communities to blend services between public preschool and private childcare. An additional $4.2 million is added back in the second year to support the new eligibility level. It is not clear that these funds are close to sufficient to begin increasing the per-child amount preschool programs receive to provide services – a critical component of our Big Bold Ask.  We proposed an additional $24 million over the biennium to begin phasing in investment for eligibility up to 200 percent of the federal poverty level, higher per-child rates to support quality programs, and continue support for preschool/childcare partnership grants to support families with full-day learning opportunities for kids.
  • Child Care Assistance Program (CCAP) – The House’s proposal also increases the eligibility threshold for CCAP from 160 to 175 percent of the federal poverty level – providing an additional $4.4 million in each year to support this policy change. Similar to preschool, it is not clear that these funds are sufficient to move the per-child reimbursement rates necessary to support the true cost of quality. Our Big Bold Ask was for $92 million over the biennium to begin phasing in investment for eligibility up to 200% of the federal poverty level, as well as higher reimbursement rates to support quality programs – for infants, toddlers, and preschool age children.

A critical concern is a $2 million cut in tobacco settlement dollars to the HANDS early home visiting program.  HANDS provides critical supports to improve pregnancy and birth outcomes, promote healthy child development, build safe homes, and increase families’ self-sufficiency.  While we understand this reduction may be off-set through the use of other funds, neither the Governor nor the House’s proposals have made this clear.

Click here for a detailed breakdown of early childhood funds in the House budget.


To deliver excellence for each and every Kentucky child in our public school, Kentucky must restore investments after long years of cuts and lost buying power.  The House’s began this process by providing some strategic investment – an increase in the base SEEK per-pupil guarantee from $4,000 currently to $4,061 in 2021 and $4,112 in 2022, a 1 percent raise for school teachers and district staff, as well as notable increases to hire additional school counselors.  Recognizing these investments as positive progress, Kentucky still needs deeper investment to support teaching and learning at the local level.

  • Full-Day Kindergarten – This was not in the House’s proposal. Our Big Bold Ask was for $42 million over the biennium to begin phasing in investment for full-day kindergarten – freeing local funds for teaching and learning improvements.
  • Transportation – The House provides no new funds for school transportation, underfunding the transportation formula as has been the practice for a number of years. Our Big Bold Ask was for $48.6 million over the biennium to begin phasing in investment for transportation – freeing local funds for teaching and learning improvements.
  • Teaching Excellence – Increasing teacher pay, even modestly, is certainly a positive as teachers matter most to student learning in the classroom. However, Kentucky must invest in systematic state support for teacher preparation, professional development, and recruitment and retention – areas that remain underfunded or not at all. Our Big Bold Ask was for $17.5 million over the biennium to invest such supports like teacher mentorship, greater stipends for National Board Certified teachers, and district/university partnerships to innovate teacher preparations and professional learning.

Click here for a detailed breakdown of the K-12 portion of the House budget.

Postsecondary Education

Kentucky’s Council on Postsecondary Education has set an attainment goal of 60 percent by 2030, while economic projections suggest that the supply of workers with postsecondary education continues to fall short of the demand for an educated workforce. To reach our goals, we must break down barriers to college access, ensure higher education is affordable, and support student success.  The House’s proposal is a bright spot in the budget –stemming the cycle of funding reductions to our colleges and universities – 33 percent since 2008 – and fully commits proceeds from the state lottery to student financial aid.

  • Colleges and Universities – The House proposes a 3.9 percent increase in total funding direct to campuses in 2021 and an additional 2 percent increase in 2022. These increases include funding to off-set pension costs at regional universities and an $64.5 million to be allocated through the performance-based funding model.  This additional investment direct to campuses totals $86 million over the biennium. While our Big Bold Ask was for $93 million over the biennium to begin phasing in investment to fully implement the performance funding model, this House’s proposal is certainly a step in the right direction.
  • Need-Based Financial Aid – With lottery receipts projected to rise and the promise to commit all lottery proceeds scholarships, this is a bright spot in the budget. The House proposes $27.6 million more over the biennium for College Access Program grants for low-income students.  Our Big Bold Ask was for $8.9 million over the biennium to begin phasing in investment in CAP grants.  Not only will CAP grants see and increase, but also other critical financial aid programs such as KEES, KTG, Dual Credit, and Work Ready scholarships.

Click here for the postsecondary House budget analysis.

New revenue is necessary for substantial change

The House’s budget proposal represents a step forward for education, but still sobering reminder  that new revenue is necessary to ensure Kentucky’s investment in education provides the return we know it can.  Without continued progress in education Kentucky’s quality of life and economic growth will suffer.

We’ve hit a plateau in education progress, declining in the last decade relative to national rankings on more indicators than we are showing progress.

  • 41st in preschool participation – down from 24th
  • 17th in fourth grade reading – down from 8th
  • 37th in eighth grade math – down from 34th
  • 26th in teacher salaries – down from 22nd
  • 30th in per-pupil finding for higher education – down from 12th

Moreover, only 52.7 percent of Kentucky’s 3rd graders are proficient in reading and only 47.4 percent in mathematics.  Only 64.8 percent of Kentucky’s high school graduates are transition ready.  And, we lag the nation in postsecondary attainment.

It’s time to build on our past success and increase our progress for the future. Combined with the ambitious goals, a commitment to adequate and equitable funding for education will ensure we meet those goals.

We are not investing in a vacuum. Other states are increasing their investment from early childhood through postsecondary, recognizing their human capital as the primary economic engine of a state and the imperative to support a seamless web of educational opportunities necessary for success in school, career and life.

We are encouraged  that the House delivered a budget that stems a decade of funding reductions and begins to reinvest in some areas of education. We urge the General Assembly and the Governor to continue the hard decisions necessary to further increase our investment in Kentucky’s people.

Click here for detailed tables analyzing the House’s proposed budget.


Further information is available in House Bill 352.

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