The Interim Joint Committee on Appropriations and Revenue said in a meeting Wednesday that it examined Kentucky's school construction funding system as lawmakers look for ways to control rising costs that have stalled projects across the state.

Committee members heard from the Kentucky Department of Education and the School Facilities Construction Commission about how the state plans, finances and prioritizes construction projects. The SFCC provides an equitable distribution of state funding for school construction and technology based on the unmet needs of Kentucky's 171 school districts.

House Majority Caucus co-chair Jason Petrie said careful oversight of school construction funding is essential. "While we must continue providing students with high-quality, safe, and modern school facilities, we also have a responsibility to control costs," Petrie said in a statement. "With new school construction approaching $500 per square foot in some cases, we know there are opportunities to build smarter and more efficiently."

Construction costs have risen significantly in recent years, with new school construction now averaging approximately $440 to $500 per square foot depending on grade level and land topography, according to state officials. The committee heard that the state's unmet facilities need for 2025 is approximately $7.2 billion, a persistent challenge as districts struggle to complete renovation and new construction projects.

The committee reviewed how local facility taxes, school revenue bonds, SEEK funding, and SFCC assistance work together to finance construction projects. State officials also outlined a new requirement under HB 500 that will require school districts to have facility evaluations entered into the Kentucky Facilities Inventory and Classification System before receiving new SFCC offers of assistance.

The committee also discussed career and technical education funding, which prepares students for high-demand careers through technical training and industry partnerships. Petrie said the discussions would inform lawmakers ahead of the 2027 Regular Session.