FRANKFORT, Ky. — The state’s budget for the next two years nears final passage as the Senate approved a compromised version of both the House and Senate versions of the budget set by a conference committee.

What You Need To Know

  • A state budget compromise passed the Senate Wednesday night, 36 YAYs to 1 NAY

  • The budget gives a 9% increase to SEEK per-pupil funding over the two years

  • Teacher's retirement system will see a total $29.1 million increase over 2025 and 2026 

  • The House will formally approve the budget Thursday

It took 57 legislative days to reach a budget approved by both the House and Senate. The budget compromise includes investments in K-12 education funding but doesn’t deliver all the budget priorities from Gov. Andy Beshear, D-Kentucky.

K-12 funding was the major focus in a free conference committee’s state budget for the fiscal years 2024 to 2026. Senate budget committee chair Chris McDaniel, R-Ryland Heights, highlighted numerous increases in the state’s funding of education for the biennium.

SEEK per student funding will increase in both years, with over $4,326 spent per student in 2025 and over $4,586 in 2026.

“We increased the SEEK funding per pupal by 3% and 6% each year respectively which in the 12 years I’ve been here is the largest increase in SEEK we’ve ever seen,” McDaniel said.

The budget also increases Tier 1 funding, a funding mechanism for districts with less property value income, from 15% to 17.5%. However, the budget does not include any pay raises for teachers, a primary request of Beshear.

“I saw that we are giving raises to state government employees, I saw that we’re giving raises to state police, but I didn’t see any reference at all to salaries of teachers,” said State Sen. Reginald Thomas, D-Lexington.

McDaniel explained that the SEEK formula is constitutionally set and must be followed properly.

“Because the SEEK formula has differing ways that the money flows into a district which is ultimately the responsible employer for the teachers, any method we choose to go through the SEEK formula will have very different impacts on a district,” McDaniel said.

McDaniel said going outside the SEEK formula for raises would put the formula out of alignment, thus violating the General Assembly’s constitutional duty.

The free conference committee also moved to increased investment into the teacher’s retirement system by $29.1 million over the two fiscal years — a $9.7 million increase in 2025 and a $19.4 million in FY 2026.

President Pro Tempore of the Senate David Givens, R-Greensburg, said this is the best education funded budget in state history.

“Current teachers that may be thinking about retiring, don’t. Don’t retire. Number one, we need you in the classroom and number two, we’re going to reward you. These pay raises will have such a positive impact on your pension,” Givens said.

The budget would fund the cost of student transportation 90% in the first year and fully funded in the second year. Senate President Robert Stivers, R-Manchester, also pointed out the issues surrounding teacher raises and said critics of the budget proposal are overlooking the major investments.

“This is a solid budget. It is the best budget that has been proposed or passed by the General Assembly,” Stivers said.

Other major highlights of the budget include multi-million-dollar investments in the clean water and drinking water funds. The Clean Water State Revolving Fund will see a $30.8 million increase in federal funds in 2025 and $25.3 million in 2026. The Drinking Water State Revolving Fund will see an $84.7 million increase in federal funds for 2025 and a $41.1 million in 2026.

The amended budget also gives state employees a 3% salary increase.

House Bill 6, as amended by free conference committee report, passed the Senate with 36 YAYs and 1 NAY.

The House will formally approve the budget compromise Thursday. Once it passes the House, Beshear has 10 days to act on it.

Related Stories