Fayette County Faces $16 Million Budget Shortfall Impacting Schools

Fayette County, September 30, 2025

News Summary

Fayette County is facing a $16 million budget shortfall for public schools, leading to discussions about cost-saving measures and potential cuts. Superintendent Demetrus Liggins is under scrutiny amid rising public dissatisfaction and legal challenges regarding unpaid debts. The district’s financial management is being reviewed, and community support is sought as leaders navigate these critical issues.

Fayette County is grappling with a significant $16 million budget shortfall affecting its public schools for the 2024-2025 fiscal year. In response, school leaders are actively seeking solutions to mitigate financial strains, which may include cost-saving measures and budget cuts. Fayette County Superintendent Demetrus Liggins, whose total compensation package for the upcoming year is $381,767, is at the forefront of efforts to navigate these financial challenges.

In July 2025, school district officials initiated discussions with local business and community leaders to explore potential strategies for combatting the budget crisis. Meanwhile, a lawsuit has emerged from a technical solutions company alleging that Fayette County Public Schools owes them over $500,000 for unpaid equipment and labor costs, further complicating the district’s financial landscape.

To combat the pressing budget issues, Superintendent Liggins has initiated an internal review of the district’s financial procedures. This comes in conjunction with oversight from Kentucky Auditor Allison Ball, who is currently performing a special examination of the district’s finances, although the pace of this review has not been expedited.

Community frustration was palpable at a Fayette County Public Schools board meeting held in August, with local residents voicing concerns over budget management. The leadership of Fayette County Public Schools has faced criticism from both sides of the political aisle regarding their handling of the budget crises.

A variety of cost-saving measures were discussed during a school board meeting on August 21, 2025. However, amid public backlash, Superintendent Liggins withdrew a controversial proposal that aimed to increase the occupational license tax rate as a solution to the financial shortfall. Additionally, concerns regarding proposed 10% budget reductions across departments, as flagged by board member Amanda Ferguson, have surfaced, drawing attention to the ongoing struggle for appropriated funding.

The nonprofit organization Kentuckians for the Commonwealth has called for an independent forensic audit of the district’s finances, reacting to alarm over dwindling emergency funds and previous funding discrepancies. Emails have indicated that Liggins previously downplayed the severity of the budget issues, despite the mounting deficits faced by the district.

The proposed budget for the 2025-2026 fiscal year reflects a cumulative $21.4 million reduction from a tentative budget laid out in May 2025. Additionally, discrepancies have arisen concerning the district’s contingency funds, with some reports fixing the amount at $15.6 million rather than the $26.3 million previously stated by Liggins.

Steps are being taken to enact new financial controls aimed at preventing further budget crises. Among the measures discussed, Fayette County Schools plans to engage an outside expert to assess its financial records and provide clarity on ongoing budget challenges. Meanwhile, Ann Sampson-Grimes, previously the suspended Budget Director, has returned to her position following a lawsuit she filed, alleging she was placed on leave after raising alerts about worsening financial conditions.

Records show that employees within Fayette County Public Schools accrued over $2.5 million on school-issued credit cards between August 2024 and January 2025. The district has developed a history of overspending its approved budgets in recent years, exceeding budget allocations by tens of millions of dollars over multiple fiscal years.

In conclusion, Fayette County Public Schools is facing a dire financial situation marked by leadership controversies and growing public skepticism. The complexities of the budget shortfall illustrate the urgent need for transparent oversight and effective management of school district finances.