Education Spending In Kentucky

Educational Spending: Kentucky vs. Other States

Educational Spending:Kentucky vs. Other States

A recent study released jointly by the Friedman Foundation, The Bluegrass Institute, and The Center for Business and Economic Research featured the following findings about education spending in Kentucky:

• Despite the increase in educational spending that occurred with KERA, Kentucky still lags behind the average U.S. state in current expenditures per student.

• Since KERA, Kentucky has surpassed all other states in the South-Central region in current expenditures per student.

• KERA has led to a significant decline in differences in educational spending across regions in the Commonwealth. The gap in current expenditures per student between metropolitan and non-metropolitan districts fell from $600 in 1987 to $10 in 2006.

• While KERA has led to greater uniformity in expenditures per student in the state, the sources of revenue continue to differ dramatically across areas of the Commonwealth. In 2006 districts in metropolitan areas received 40% of their revenue from local sources (property taxes) with the remaining revenue coming from the state (50%) and the federal government (10%). At the same time non-metropolitan districts received only 20% of their revenue from local sources with 66% of their revenue coming from the state and 13% coming from the federal government.

• Between 1987 and 2006 the share of revenue coming from local sources increased in Kentucky while the share of local revenue decreased on average in the U.S.. However, there still remains a signifi cant difference in revenue sources between Kentucky and the average state.

• How Kentucky allocates its money on education is quite similar to the average state in the country with approximately 50% of current expenditures going to instruction and 7% to administration. Compensation has a larger share of total expenditures in Kentucky with 70–80% of total expenditures going to salaries and benefits in contrast to 69–73 % for the average state over the period 1989–2006.

• In 1987 Kentucky’s pupil-teacher ratio was 18.6 compared to the U.S. average of 17.4. By 1998 both the U.S. and Kentucky average was 16.5. However, since then the U.S average has decreased at a much faster rate; in 2006, the U.S. average was equal to 15.2 and the Kentucky average was 16.0.

Read the entire report here

Educational Revenue Data

The Educational Spending:Kentucky vs. Other States report revealed that while patterns in spending are similar amongst all Kentucky's school districts, the source of funding is strikingly different from region to region. Urban areas in the state see roughly 40% of their funding coming from local sources. That is in contrast to rural regions which receive roughly 20% of their funding from local sources. The difference in this amount of local funding for rural areas is provided by state funds. The report concludes that it is possible that the lower level of local control over districts in rural areas of Kentucky could impact educational outcomes in these districts.

The information in the following graphs illustrates trends showing how districts have increasingly relied on state funds rather and how nonmetropolitan areas have been able to rely less on local funds than metropolitan areas.

Figure 2.1 Revenue by source for Kentucky school districts	Figure 2.2 Local revenue per student for state, metropolitan, and nonmetropolitan areas within Kentucky
Figure 2.3 Local revenues per student for regions of Kentucky	Figure 2.4A Total expenditures per student for state, metropolitan, and nonmetropolitan areas within Kentucky