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KSBIT debt (February 16, 2013) |
After learning last month of the Kentucky School Board Insurance Trust’s impending closure, school districts around the state that are in debt to the trust began attempts to conserve funds while bracing to learn what they might have to pay back.
The trust, often referred to as KSBIT, released preliminary figures in January for what each district might have to pay. The final numbers could be ready within a month.
KSBIT owes about $35 million, according to Mercer County Superintendent Dennis Davis during Thursday’s school board work session meeting. He explained that it is anticipated the assessment will be lower, decreasing the amount each school would have to pay.
Preliminary figures anticipate Boyle County Schools owe $381,225; Burgin Independent Schools owe $44,076; Casey County Schools owe $223,936; Danville Independent Schools owes $105,697; Garrard County Schools owes $167,911; and Lincoln County Schools owes $450,801.
Due to the 2006 consolidation of the Harrodsburg and Mercer County districts, Mercer County will be expected to cover the costs of both schools, now estimated at $668,205, Davis said.
Currently, the amount that districts could pay range from nothing for the Richmond Independent Schools to over $2 million for Fayette County Schools. Each was assessed based on the length of time they were members, the amounts that were paid to the schools through workman’s compensation, liability and other claims.
The Kentucky School Board Insurance Trust was created in 1978 as a self-insurance fund, making participants part owners as well. If there was a surplus, the money was passed on to member districts to supplement their budgets. If deficits arose, the districts had to pay into the fund.
Unfortunately, deficits were incurred for the Workers’ Compensation pool from 1990 to 2011 and the Property and Liability pool from 1993 to 2012, negatively impacting member districts across the state.
On its website, KSBIT explained the trust had incurred over $400 million in losses and processed over 116,000 claims since its inception. The school districts will be given financing options, including 10 and 20 years repayment plans.
KSBIT stressed to members on the website that the numbers are still preliminary. It is anticipated the final numbers could be ready within a month.
