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In 2018-19, KSU received $6,953,205 in U.S. Department of Agriculture administered federal grants to support its land grant program. That same year, after increasing the General Fund appropriation for Land Grant match by $290,000, the Council on Postsecondary Education staff and campus officials agreed that the university had $6,941,400 in its net General Fund base to meet the match, so the funding gap that year was -$11,805.
As the analysis above demonstrates, the Commonwealth of Kentucky is not meeting the required federal match for KSU's land grant program. Under conditions of the grants, the university is authorized to receive and expend federal funds to support land grant program activities and services, provided those funds are either matched by the state, or KSU receives a waiver absolving it of that requirement. In previous years, the university has requested and received a waiver, but there is no guarantee that waivers will be granted going forward.
The Council on Postsecondary Education recommends appropriations of $7,148,800 in 2020-21 and $7,148,800 in 2021-22 to provide a sufficient amount of recurring state funds to meet federal match requirements for Kentucky State University's land grant program.
These funds will help sustain the effectiveness and impact of outreach, service, and applied research at KSU's land grant program.
The Council on Postsecondary Education requested Performance Funding as part of the 2012-14, 2014-16, and 2018-2020 biennial budget submissions. For the upcoming 2020-22 biennium, the Council is once again recommending appropriations for performance funding.
Kentucky's public colleges and universities have experienced seven operating budget cuts over the past ten years. The Council and campus officials strongly encourage the General Assembly to finance the proposed performance funding approach with new appropriations, instead of carving funds out of existing base operating funds of the postsecondary institutions.
For the upcoming biennium, both university and two-year college sectors shall include a stop-loss provision for fiscal year 2020-2021 limiting the reduction in funding to any institution to two percent (2%) of that institution's formula base amount. Kentucky State University and CPE staff believe this requirement should be addressed in the 2020-2022 budget bill in the same manner as the 1.0% stop loss was handled last biennium; namely, by reducing each institution's fiscal year 2020-21 regular appropriation by two percent of its 2019-20 adjusted net General Fund and transferring the resulting $14,997,800 total to the PEPF. This will result in a -$372,200 cut to the FY2021 KSU regular appropriation.