HB 500: Kentucky’s Budget

HB 500 is the proposed state budget for the next two years (2028). Within the education space, this bill would freeze SEEK funding for two years; cut school transportation funding by $129 million by 2028; cap the state health insurance contribution, leading to a $202 million shortfall; increase insurance premiums; and include zero educator raises or preschool investment.

1. How does this legislation impact the wellbeing of Kentucky’s 660,000 public school students? 

HB 500 proposed freeze to SEEK funding would equate to a 26% decrease in per pupil funding levels when compared to 2008, a $100 million decrease in funding. Districts in rural and impoverished areas, with smaller local tax bases, will struggle to make up for lost state funding, exacerbating existing inequities within our education system. 

Further, cuts to the school transportation budget, equating to $40 million dollars (when compared to the last fiscal year) will lead to staffing issues for bus drivers - like we have seen in Jefferson County Public Schools. 

Students suffer when investment in public school classrooms stagnates, or declines. Our public schools are in need of a substantial reinvestment in order to be restored to 2008 levels

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2. Is this legislation in-line with the 7 capacities of a constitutionally adequate education as defined by the Kentucky Constitution? 

The Rose decision called for an adequately funded education system, but today, the per pupil funding inequities between rural and urban schools is greater than it was when it was declared to be at unconstitutional levels in 1989. 

HB 500 continues the recent trend - since 2008 - of decreasing state payments into the SEEK base. If the budget passes, the inequities in funding between urban and rural districts will continue to grow. 

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3. What is the broader impact of this legislation on Kentucky public schools, including on educators, parents, and other education stakeholders? 

Beyond the cuts to the state SEEK base and school transportation, HB 500 increases health insurance premiums for state employees like educators, bus drives, and school social workers. According to the Kentucky personnel cabinet, HB 500’s passage could lead to a 78% increase in premiums for state employees. 

A school bus driver could see increases as much as $585 a month, over $6,000 a year on top of what they paid in the previous year. For a school social worker, increases could be closer to $450 a month, unsustainable for most. At a time when Kentucky is experiencing teacher, bus driver, and school counselor shortages, HB 500 stands to worsen that severely by reducing a key benefit from these jobs.