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Hancock County Schools on solid financial footing



Kris Kemp Provides Audit Review at Hancock County School Board Meeting

County native Kris Kemp, CPA and partner at Alexander Thompson Arnold (ATA), provided a detailed review of the annual district financial audit and reported that the schools are in “solid financial footing” at the Hancock County Board of Education meeting on Thursday, January 26th.


Kemp handed out the 96 pages of the school’s audit and went over the highlights with board members. “This school board has, for the past 2 years, done pretty good financially,” he said. “A lot of good things have happened. It’s in a solid financial condition.” As of June 30th, 2022, the general fund balance at the beginning of the school year was $4,529,327 and at the end of the school year was $5,167,276.

He showed a comparison of expenses between 2021 and 2022 and said that instruction expenses have gone up because with covid there was a smaller number and now with more teachers on the payroll, that is to be expected. Student transportation expenses, he said, increased by $472,000, due to more days in school compared to the prior year and the increased fuel prices.

“On the revenue side, Kemp said, “operating grants were up 1.7 million. Some of the major industries pay utility tax and part of that goes to the schools. That increased from ’21 to ’22 – $715,000. There was some general revenue that came in that was higher than normal. There were factory issues going on in the past year in the county that might impact that. That’s something for you all to consider.”



Century Shutdown – negatively affects school system

The temporary shutdown of Century Aluminum has negatively affected the schools. The large amount of utilities that Century used when in operation brought in money to the school system. If Century doesn’t re-open, they will be taking a huge loss in that area, Superintendent Asberry said.

Schools’ investment in technology

Over $500,000 was invested, additionally, into technology. Kemp said that expenditure is going to continue “no matter what, just to stay in line because it is constantly changing.” He added, “You guys have spent a lot these past 2 years transferring to the Chrome Book and away from iPads.”

Cash and cash equivalence

“At the end of the year it was almost 6.5 million, that increased 1.3 million from the prior year. The cash position of the school system is in pretty solid ground. Accounts Receivable – taxes – that went up $250,000. There was a large utility tax that got paid later in the year,” Kemp said.

Pension Liability

“Your non current portion of your bond obligations,” he said, “that has dropped 1.3 million. Everybody knows there’s a pension deficit and a pension issue, in the way it gets assigned to every government entity is super complex but just know right now that your pension liability has gone down by $126 million. That part of that is the investments within the state. Your net position went from $2.9 million to $6.59 million. There’s an increase in your net position of the school board – $3.6 million. That is solid financial footing.”

General Revenues

“General revenues that come in,” Kemp said, “they have been pretty consistent with property tax and motor vehicle tax, which is to be expected. Again, the utility tax for this year was $2.2 million that came in which was up $700,000 from the prior year. You may run into an issue with that moving forward depending on how much comes in from that.

Some of your other grants that came in were also increased and you had some disposal of assets that brought in some money. The net position change – it was $3.6 million and the prior year it was only $182,000. So from 2020 to 2021 assets of the board of education only went up just under $200,000 whereas this year it went up $3.6 million.”

Covid money made up a large chunk of that, Kemp said. “That was from on the government side. You also had a definite increase in the general revenue. This year the general revenue was $17.9 million and last year that number was just under $15 million. The covid did help out,” he said. “A lot of that covid money was already, I won’t say ‘spoken for’ but there was an understanding of what it was for. You actually had more general revenue come in than what you anticipated, than what has been the past few years – up to almost $2 million more. Something to keep in mind in your budgeting moving forward.”


Superintendent Asberry further explained that, “We were able to bring in more money – a lot of that had to do with the Elementary and Secondary School Emergency Relief Fund (ESSER) grant. It was able to take up some of those expenses. We actually brought in and carried over more money because of that grant money. This next school year will be the last year we can use any of those ESSER funds. That’s why we’re trying to prepare for the future to where we don’t have to lose some of these positions that were added during ESSER because I do feel like a lot of those positions will be needed in the future.”

Revenues and Expenditures

“Your other government funds tend to only be a loss and that’s $454,000,” Kemp said. “The facility support program which involves some of the nickel tax was $1.2 million. Your general fund – you were up $755,000.”

Bond Debt Obligations

“After the 2023/2024 year it drops,” Kemp stated. “So your debt service payments will be dropping almost half a million dollars during that time. Your biggest bond you have sitting out there matures in 2024 so over the next couple of years when you get into planning you’re going to have some debt relief compared to what you’ve been having. You guys are in solid financial footing and your debt expense will go down in the next few years.”

Single Audit

“If you expend $750,000 of federal funds you have to have what’s called a single audit,” Kemp explained. “It is basically an audit within an audit. We look specifically at that program on the fed side. And there were a couple of programs mostly from the covid money that came that got expended out. We had to pull a couple of programs and review those. We had no issues with how the covid money and any other federal funds were expended. We look at almost all of those transactions that occurred and we had no issues.”

Student Activity Funds

“For the state of Kentucky,” he said, “we have to come in the second week of July and look at every school and get all of the activity funds. They have to look at invoices, receipts, etc.”

Kemp ended his presentation stating that, “Overall, you guys are in much better shape than when we started a few years ago.”

New Board Members Sworn In

New board members Brooke Payne (District 3) and Vanessa Cox (District 1) were sworn in and welcomed by the board. Allen Kennedy and Raphael Wheatley were previously serving in those 2 seats.

New Lighting in HCHS Gym

The board approved new lighting for the HCHS gym. Superintendent Robby Asberry said, “We’re hoping to install it as soon as possible but especially before graduation.” The LED lighting will be more efficient and significantly brighter as well, he said.

Treasurer’s Report

Board Treasurer and Director of Finance for Hancock County Schools Kara Eckles read the treasury report and it was as follows: the month of December began with $5,154,244 and monies received totaled $4,462,695. Expenditures were $1,499,364, and the month ended with $8,057,928. Accrued Salaries and Benefits Payable totaled $59,647.

The Hancock County School District statement of revenues, expenditures, changes in fund balance and governmental funds as of June 30th, 2022, succinctly are as follows: Total revenues: general fund – $18,333,106, special revenue – $3,370,820, Facilities Support Program of Kentucky (FSPK) Fund – $1,209,614, other governmental funds – $1,701,019 and total governmental funds – $24,614,559. Total current expenditures: general fund – $17,597,486, special revenue – $3,351,669, construction fund – $408,162, other governmental funds – $2,155,881 and total governmental funds – $23,513,198. The fund balance at the beginning of the year: general fund – $4,529,327, construction fund – $156,861, FSPK Fund – $851,277, other governmental funds – $597,451 and total governmental funds – $6,134,916. The fund balance at the end of the year: general fund- $5,167,276, construction fund – $156,861, FSPK Fund – $1,321,414, other governmental funds – $882,066 and total governmental funds – $7,527,617.

By Jennifer Wimmer

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