Tax Statement 2026
LaRue County Families,
Please take a few minutes to review the information below. We are committed to keeping our families and community informed and providing clear, straightforward information about how the school district’s tax rate is established each year.
This information is intended to explain how the tax rate-setting process works, what you can expect as we move through this year’s process, and how the current litigation may impact the rate-setting process for this year.
We understand that tax rates can be complicated, and we want to do our best to provide accurate information and transparency throughout the process.
Understanding Larue County Schools' Tax Rate
Larue County Schools' district leadership strives for transparency and open communication.
The following explains how the school tax rate generates funds, particularly for "restricted/construction/capital projects," also known as "nickel tax funds," and how those funds are collected and utilized.
Local boards of education are given tax rate options to choose from by the Kentucky Department of Education each fall. Historically, most districts review and choose from a range of rates, from the "compensating" rate to the "4%" rate. All public school districts are required to set tax rates annually.
Kentucky law (KRS 160.470) defines several rate options a board may consider each year:
Compensating Tax Rate — the rate that, when applied to the current year's property assessment (excluding new property), produces an amount of revenue equal to that produced in the preceding year.
Subsection (1) Tax Rate — refers to subsection (1) of KRS 160.470; it restricts a local school board to a tax rate that will produce no more revenue than the previous year's maximum rate.
4 Percent Increase Tax Rate — the rate that will produce 4 percent more revenue than the amount produced by the Compensating Rate.
Tier I Property Tax Rate (House Bill 940 / KRS 157.440) — depends on the mix of taxes levied by a district, including real estate, personal property, motor vehicle, and permissive taxes.
Districts most often set their rate somewhere between the Compensating Rate and the 4% Rate. Depending on how property values in the county move from year to year, the resulting rate can be:
Lower than the adopted rate from the year before, if property values increase year over year;
The same as the adopted rate from the year before, if property values have generally held steady year over year;
Higher than the adopted rate from the year before, if property values have decreased year over year, as may be the case if a large industrial base leaves the area, for example.
If the district takes the 4% rate, does this mean my taxes increase by 4%?
No. A common misconception is that if a board approves the 4% rate, your taxes are going up 4%. This is not the case. The 4% refers to the additional revenue the district as a whole is projected to receive compared to the year before — not a 4% increase applied to any individual property owner's tax bill. Because the 4% figure is calculated against total district-wide revenue, and that revenue is spread across all taxable property in the county (including new construction and rising property values), an individual homeowner's tax bill typically changes by a much smaller percentage than 4%, and in years when property values rise significantly, the actual rate charged per $100 of assessed value can go down even as the district's total revenue goes up by 4%.
What are exonerations?
An exoneration is an adjustment made to correct a property valuation or tax bill error. When a property is mistakenly over-assessed, the owner receives a tax refund, which reduces the school district's anticipated revenue. To recoup those lost prior-year funds, state law allows a school board to add a fraction of a cent to the current year's property tax rate — this is known as the exonerations recovery rate. Because it exists solely to make the district whole for revenue it should have already received, an exonerations adjustment does not represent additional taxing beyond what was originally levied, and rates that include it (up to and including 4% plus exonerations) still do not require a public hearing — only public notification.
Is it truly a “nickel” added to the tax rate?
No. Last year, we actually took a lower foundational tax rate and added the bare minimum as part of the “nickel” portion. The “nickel” is usually 5.8 cents per $100 and LaRue County took 3.8 cents per $100. This allowed us to implement the least amount of tax possible while gaining the benefits of the “nickel” tax our community would gain from the state, which would be additional dollars through equalization funds and we would also qualify for additional dollars if we decided to move forward with construction on schools.
Are we required to have a public hearing?
No. Kentucky law requires a public hearing when a school district proposes a tax rate that is higher than the district’s 4% tax rate. The hearing gives the public an opportunity to comment on the proposed rate before the Board takes final action. If the Board adopts any rate below the 4% rate, a public hearing is not required. The requirement is based on the rate being proposed, not simply on the fact that the district is setting its annual tax rate.
How has legislation that was passed impacted how we set our rates?
There have been several changes as a result of legislation passed during the last legislative session, as well as additional guidance and actions from the Kentucky Department of Education (KDE) that we must consider as we establish this year’s rates.
Annual Property Tax Rate Adoption Process (KRS 160.470):
Notification and Meeting Requirements for Rates Up to and Including 4% Plus Exonerations
Property tax rates that are up to and including 4% do not require a public hearing. The district is required to provide public notification of the proposed rates.
Exonerations may be included in the property tax levy but do not trigger recall requirements.
A district may not levy the prior year’s rates if those rates exceed the current year’s 4% allowable rates.
Required Steps:
Receipt of Tax Rate Reports
The district receives its Tax Rate Reports. The 45-day period to complete the tax rate adoption process begins on the date the district receives the reports. If the district fails to complete the process within the required 45-day period, compensating rates will be applied to the current year’s tax bills.
Meeting #1 – Determine Proposed Rates
The board meets to review and determine the proposed property tax rates.
Our Board did this on August 17, 2026.
Public Notification – Ads #1 and #2
Following Meeting #1, the District notifies the public of the proposed tax rates. The district must publish the notification for two consecutive weeks:On the district’s website home page; and in the newspaper with the largest circulation in the county.
Meeting #2 – Adopt the Rates
Because the proposed rates do not exceed 4% plus exonerations, Meeting #2 does not require a public hearing. The board proceeds with a formal vote to adopt the proposed rates.
Post-Adoption Notification – Ad #3
Following adoption, the district must post the adopted tax rate information on all district social media platforms. The district may also provide a notice containing the adopted rate information to the editors of all print media outlets.
How has the school tax petition lawsuit impacted this year's tax rate?
As most people are aware, the district is currently involved in litigation concerning the 3.8-cent portion of our tax rate, commonly referred to as the “nickel” portion. Because this matter remains in litigation, KDE has suspended the implementation of our recallable rate until the litigation is resolved. As a result, the tax rate approved by the Board last year is not serving as the foundation for the rate we are being required to use this year.
This has created some disagreement regarding the interpretation of KRS 132.017, specifically as it relates to the tax rate we are required to use this year and the district’s eligibility for the equalization portion of our revenue.
LaRue County Schools have remained in ongoing communication with KDE throughout this process. On August 10, 2026, I, along with our School Board Chair, Director of Finance, LaRue County Fiscal Agents, and our board attorney met with KDE representatives in Frankfort to advocate for our district. We expressed concerns about the interpretation of the statute, as well as the challenges created by requiring the district to recognize a tax rate our Board did not ultimately approve.
We also wanted to ensure that, if the current litigation is ultimately resolved in the district’s favor, LaRue County Schools maintains its eligibility for the equalization portion of the revenue. We believe it is important to protect the district’s financial position while this matter is being resolved.
As part of this process, we learned that, on June 3, 2026, KDE recommended that the Kentucky Board of Education approve the “suspension” of the 3.8 cents from the 2025 nickel pending the outcome of the litigation. Once the Kentucky Board of Education approved that suspension, the 3.8-cent recallable nickel portion was excluded from the rates presented for 2026. Accordingly, the proposed 2026 rates reflected the 4% tax rate from 2025, rather than including the 3.8-cent recallable nickel portion suspended due to the litigation. This has created confusion regarding the change in the base tax rate and how that change relates to the tax rates presented for 2026.
I also want to make one point very clear. During our meeting, KDE staff confirmed that their guidance regarding how this year’s tax rate should be calculated is not a reflection of KDE’s position on the litigation or its opinion about the potential outcome of the litigation. Their guidance is specific to how they are requiring the district to calculate and recognize the tax rate for this year while the litigation remains unresolved.
I want to acknowledge that this has created a very confusing and frustrating process—not only for the district, but also for our taxpayers. We are being required to recognize a rate that could ultimately change depending on the outcome of the litigation. That creates uncertainty for the district and makes it difficult to clearly communicate the impact to our taxpayers.
Throughout this process, LaRue County Schools has worked to navigate the legislative changes, follow the guidance provided by KDE and our legal counsel, and protect the district’s financial interests.
I truly appreciate the support of our community and as always, please feel free to reach out if you have any additional questions.
Our next meeting day will be September 14, 2026 @ 6:00 pm, LaRue County High School Library.
Adryanne Warren
LaRue County Schools Superintendent
adryanne.warren@larue.kyschools.us | (270) 358-4111
Tax Notice:
The LaRue County Board of Education is proposing a general fund tax levy of 54.0 (which includes exonerations of 0.2 cents – 53.8 plus 0.2 cents) cents on real property and 54.0 (which includes exonerations of 0.2 cents – 53.8 plus 0.2 cents) cents on personal property.
The General Fund tax levied in fiscal year 2026 was 53.4 cents on real property and 53.4 cents on personal property and produced revenue of $5,958,020.80. The proposed General Fund tax rate of 54.0 cents on real property and 54.0 cents on personal property is expected to produce $6,052,060. Of this amount, $989,831 is from new and personal property. The compensating tax for 2027 is 51.8 cents on real property and 51.8 cents on personal property and is expected to produce $5,805,494.89.
The proposed rate is expected to generate more revenue than received in the preceding year. The general areas to which revenue of $94,040 above 2026 revenue is to be allocated are as follows: Cost of collections, $3,762, building fund reduction of $42,226, instructional $97,497, transportation $13,322, and maintenance $21,685.
If the recall effort relating to the 2025 tax rate is resolved in favor of the LaRue County Schools, the recallable portion, 3.8 cents, of the 2025 tax rate will be added to the rate adopted this year.
This information is published pursuant to KRS 160.470. The proposed tax rate is not subject to recall under KRS 132.017.
The General Assembly has required publication of this advertisement and information contained herein.
