Fayette County Public Schools has been suffering a $16 million budget shortfall for months now. FCPS proposed a tax increase in response, which raised questions among local taxpayers. In the midst of multiple investigations and calls for leadership resignations, it was found that FCPS paid a lobbying firm $38,000 and failed to inform all board members of the contract. Increasing concern regarding the financial responsibility of FCPS leadership has led Kentucky Auditor Allison Ball to announce that her audit of FCPS will be complete months earlier than originally anticipated.
On June 20, 2025, Ball opened an investigation that aimed to verify financial statements and assess the district’s performance, operations, and compliance with requirements. The investigation remains ongoing.
Then, in July, the newly assembled FCPS budget work group spoke out against a tax increase. Members of the community were recruited for the group for the purpose of assessing the district’s finances and making recommendations.
“We can’t tax our way out of this problem,” some of the group’s members wrote in a July 30 Herald-Leader op-ed. “The reality is that the budget is structurally imbalanced. Bringing balance to the revenues and expenses is the only way to achieve long-term stability and sustainability.”
The group primarily suggested that the district tap into its contingency fund to cover its near-term $16 million budget shortfall. However, Superintendent Demetrus Liggins revealed that the contingency fund is millions of dollars smaller than anticipated.
“The district’s contingency is projected to fall below the 6% target required by FCPS policy, though we do anticipate meeting the state-required 2% minimum,” Liggins told the Herald-Leader in an August interview. “As a result, reducing contingency will not be a viable budget-balancing option this year. We will likely recommend maintaining the 2% level in the 2025-26 budget and rebuilding it over the next several years.”
On August 18, 2025, the FCPS school board voted to hold a September 5 public hearing to discuss a potential tax increase, which would allow the board to legally propose an occupational license tax increase.
In a special-called meeting on August 28, 2025, Liggins and several board members were secretive and refused to publicly discuss updated budget figures, despite the fact that school district budgets are public information under Kentucky law.
A dramatic shift occurred at the special-called meeting when Liggins advised against increasing the occupational license tax rate. Regardless of top officials and a majority of the school board members being publicly supportive of the increase, Liggins instead proposed a package of spending cuts. Most of the proposed spending cuts do not require board approval and can be implemented quickly. These include a hiring freeze that exempts only teacher and bus driver positions, cuts to district-level departments, and reassigning staff.
In light of the rising tension surrounding the financial crisis at hand, Ball has announced that her audit of FCPS will be complete by spring of 2026.
“I think we figured out a path forward where we can isolate the financial issues, do a penny by penny review, tell them what they need to do to be able to get their house in financial order, [and] really fix this school district for the future financially,” Ball said on Kentucky Newsmakers. “I think we can do that in a way that’s much faster.”
Despite facing scrutiny from the state government, the district said it will continue to rely on the lobbying firm’s support so staff can “maintain focus on supporting the daily needs of our students and school staff.”
Persistent financial struggles, the obscured lobbying contract, and accelerated audit of FCPS all demonstrate the lack of transparency throughout FCPS leadership. The competence of these individuals affect more than 40,000 students, so it is essential that the financial circumstances facing the district are resolved in a quick and sensible manner.
