Management Improvement Program

​KRS 158.780 and KRS 158.785 require that the Kentucky Board of Education (KBE) establish a program for management improvement services for those school districts which demonstrate such a critical lack of efficiency or effectiveness in governance or administration that state-mandated corrective action or state control of the district is required.

703 KAR 3:205 is the administrative regulation which outlines the operational procedures for the management improvement program. As outlined in this regulation, the Kentucky Department of Education (KDE) may initiate a management audit of any school district and this comprehensive audit shall include an investigation of the district's compliance with state and federal statutes, administrative regulations and local board policies. Reference the workflow used to determine the need for a management audit.

​​A management audit is a complex cross-functional process involving multiple offices within the KDE. Upon completion of a preliminary management audit report, the Commissioner of Education shall determine if a pattern of a significant lack of effectiveness and efficiency in the governance or administration of the school district exists. If the Commissioner determines that such a pattern exists and state assistance or state management is necessary to correct the inefficiencies and ineffectiveness, the Commissioner may recommend to the KBE that the district be designated state-assisted or state-managed, based upon the final management audit report. A district is entitled to a hearing, before such a recommendation is adopted by the state board. 

Pursuant to KRS 158.785 (6), a designation of state-assisted by the KBE means that the KDE shall provide assistance to the district to develop and implement a plan to correct deficiencies found in the management audit. The Commissioner may recommend a change in designation to state-managed, if the plan is being inadequately developed or implemented. Pursuant to KRS 158.785​ (7), a designation of state-managed by the KBE means that the Commissioner, or authorized designee, shall exercise all administrative, operational, financial, personnel, and instructional aspects of the management of the school district formerly exercised by the local school board and the superintendent. A designation of state-assisted or state-managed may be effective for three consecutive (3) years in accordance with KRS 158.785 (8).

Disclaimer:This summary is being provided for general informational purposes only and should not be solely relied upon by any person or entity to make any decisions. Any person or entity reviewing this information should consult with legal counsel, prior to reaching any legal conclusions about the management audit process.