DATE: June 7, 2018
SUBJ ECT: Budget for FY 2019 and FY 2020
FROM: ___ Office of Finance and Administration
ACTION ITEM: Yes
BACKGROUND: KRS 164.350 directs the Kentucky State University Board of Regents, upon recommendation of the President, to adopt an allocation process for distributing funds appropriated to Kentucky State University by the General Assembly. Also, KRS 164.350 directs the Board of Regents to assure that the budget planning and implementation processes are consistent with the adopted strategic agenda, the biennial budget, and the mission of Kentucky State University.
The budget enacted by the Kentucky General Assembly for the FY 2018-20 fiscal biennium reduces state funding for Kentucky State University by 6.25% in fiscal year 2018-19 and by an additional 1% in fiscal year 2019-20.
Pension costs for the Kentucky Employees Retirement System will increase from approximately 49% of payroll to 84% of payroll in this biennium. There is also concern that pension contributions to the Kentucky Teachers' Retirement system will increase this biennium as well. The Governor's Office has also discussed publicly the possibility of an additional reduction in state funding in fiscal year 2019, perhaps as early as August.
All comprehensive state universities in Kentucky are struggling with how to address reduced revenues and increased pension costs. Western Kentucky University recently announced faculty and staff reductions totaling 140 positions. Eastern Kentucky University announced the elimination of 153 positions as well.
The Kentucky State University Faculty Senate approved a resolution on April 13, 2018 recommending a minimum annual 2.4% increase in budgetary funds allocated to Instruction, spread over five years. While the proposed budget does increase the percentage of funding allocated to instruction, the specific amount will not be certain