Republican auditor finds Kentucky Education Department needs ‘widespread improvements’
Republished from Kentucky Lantern
Kentucky Auditor Allison Ball announced that a special examination of the Kentucky Department of Education found “widespread improvements needed across the agency.”
Ball’s office released the examination, which is more than 550 pages, late Monday evening. The General Assembly passed legislation in 2024 directing the auditor to review the state agency that oversees public K-12 schools in Kentucky.
“Kentucky’s children deserve to receive the education they need to be competitive in the real world,” Ball, a Republican, said in a statement. “This examination provides a clear path forward for student success, parent accessibility, and teacher support in all of Kentucky’s schools. It can serve as a guiding document for Commissioner (Robbie) Fletcher as he continues his work to improve the state of public education across our Commonwealth.”
The auditor says the Education Department failed to use $250 million that could have gone into bolstering underfunded areas of education during fiscal years 2021-24 — a conclusion the department disputes in its response to the report.
The disagreement between the department and auditor appears to revolve around their conflicting interpretations of state budget language.
The auditor’s report specifically says pupil and vocational transportation were underfunded areas that could have benefitted had the department reallocated excess funding as the state budget allows. Instead, the department returned or “lapsed” the $250 million to the state’s General Fund or Budget Reserve Trust Fund.
The money in question was allocated through the state’s basic education funding SEEK (Support Education Excellence in Kentucky) formula.
Earlier this year, Fletcher wrote that KDE was predicting a $40 million SEEK funding shortfall in the 2024-25 academic year.
The SEEK formula determines the amount of state funding to local school districts. The formula has a base per-pupil funding allocation, along with additional funding for factors like transportation costs or the number of students in a district who qualify for additional resources like special education, free or reduced-price lunch and English language assistance.
Other findings included:
- “Kentucky still has significant work to do related to closing achievement gaps and
- ensuring all students are prepared for future success.”
- When reviewing diversity, equity and inclusion initiatives, auditors “did not observe any program or activity at KDE that indicated non-compliance with current federal guidance” as of May 2025.
- KDE and the state’s other education and labor agencies “have gaps in communication, in alignment around strategic resource planning, and in goal-setting for a unified state-level vision for student success in K12, postsecondary, and career.”
The auditor’s office conducted the examination with PCG Consulting Group on KDE’s activities between July 2020 and June 2024. The full report includes a June 2025 response to the audit from Fletcher on KDE’s behalf, saying there is “what may be perceived as a conflict of interest” with PCG. Fletcher said the consulting firm held contracts with KDE and was an active bidder on two KDE solicitations during its involvement in the examination. PCG was not awarded either contract.
Ball said in a follow-up letter dated July 1 that KDE did not inform her office or PCG about the possible conflict of interest but instead “decided to raise this issue for the first time now,” after seeing the report. Ball also asserted that PCG and her office “worked side-by-side to critically analyze KDE, without reservation.”
PCG also included a reply to KDE’s claim saying it conducts a “conflict check” before responding to any request for proposals or other opportunities, and that it has other state-level clients in Kentucky.
In a statement about the audit as a whole, Fletcher said it “took many, many hours of staff time to speak with the auditors and provide the documents that were required for this deep look at how the agency operates.”
“In every section, the report highlights the good work agency staff have been doing to support the students and educators of Kentucky,” Fletcher said. “The audit showed that morale at KDE is high, our staff members truly believe in the agency’s work and that superintendents believe they can rely on KDE to provide them with high-quality resources.
“KDE is an organization focused on continuous improvement. We look forward to utilizing the APA’s final report to identify opportunities for future growth and plans for continued improvement in service of Kentucky’s public school students. We welcome the opportunity to work with the Kentucky General Assembly for the legislative changes necessary to accomplish recommendations within the report.”
Though they acknowledged they are still reviewing the audit’s findings, Republican House Speaker David Osborne and Rep. Scott Lewis, the chair of the House Primary and Secondary Education committee, said in a Tuesday press release that “it is abundantly clear that it provides an invaluable road map for improvements.”
“The Department of Education holds arguably the most important mission in state government: preparing the next generation of Kentuckians for success. Yet, far too many students fall short of their academic potential because of failed programs, broken systems, and antiquated processes that no longer serve today’s needs,” the statement said. “Education continues to be a priority for the legislature. We’ve provided historic levels of funding — even after adjusting for inflation — and adopted policies to improve curriculum, behavioral issues, and attract talented educators.”
The Republican lawmakers added that legislators “must consider recommendations and implement the changes necessary to create real, measurable improvement” and they look forward to working with KDE, educators and administrators “to address the concerns identified in this audit and to build a stronger, more accountable educational system for all Kentucky students.”
The Kentucky General Assembly will convene in Frankfort for the 2026 legislative session in January. One of the top legislative priorities will include deciding the next two-year state budget.
The Republican Party of Kentucky issued a statement criticizing KDE for the “improperly returned” $250 million in SEEK funding, particularly amid the predicted shortfall earlier this year.
“Until Andy Beshear and the Kentucky Department of Education can properly manage the funding already available for local school districts, they have no business requesting more money or using taxpayer-funded public relations stunts to pressure the General Assembly into launching new education programs — especially when Auditor Ball’s report clearly shows this administration is incapable of managing the ones already in place,” said RPK spokesperson Andy Westberry.
Kentucky Lantern is part of States Newsroom, a network of news bureaus supported by grants and a coalition of donors as a 501c(3) public charity. Kentucky Lantern maintains editorial independence. Contact Editor Jamie Lucke for questions: [email protected]. Follow Kentucky Lantern on Facebook and Twitter. Kentucky Lantern stories may be republished online or in print under Creative Commons license CC BY-NC-ND 4.0.
Donate to Kentucky Lantern here.
