By Loraine DeBonis/For The Sentinel
MURRAY – More than $27 million in federal funding for K-12 and higher education in Calloway County could be at risk as a result of President Donald Trump’s federal funding freeze and executive orders affecting education; diversity, equity and inclusion; school lunches; and scientific research.
The bulk of federal funding for education in Calloway County goes to Murray State University (MSU), but the county is also home to two K-12 school districts that also rely heavily on federal funding. Combined, the Calloway County School District (CCSD) and Murray Independent School District (MISD) could potentially lose around $7 million.
CCSD serves just under 3,000 students and employs 430 full-time workers, 70 aids and substitutes. It receives approximately $4.7 million in federal funding, district officials told The Sentinel.
The majority of funds come from the U.S. Department of Education (ED) for three programs:
- Title I, which provides supplemental financial assistance for children from low-income families. Its purpose is to provide all children significant opportunity to receive a fair, equitable and high-quality education, and to close educational achievement gaps by allocating federal funds for education programs and services,
- Title II, which helps schools recruit, train and retain effective teachers and leaders, and
- Special education, which is required by the Individuals with Disabilities Education Act (IDEA) to help pay for special education and early intervention services for children with disabilities.
More than $2 million of that total, which is not commingled with the district’s general budget, comes from the U.S. Department of Agriculture (USDA) to help fund food service.
For CCSD, losing ED funding alone is equivalent to losing 19 teachers or support staff positions, according to analysis from the Kentucky Center for Economic Policy (KyPolicy), an independent research and policy organization based in Berea, Ky.
“It’s hard to predict what we would do because we don’t know what cuts are coming,” said Ryan Marchetti, CCSD director of professional development and public relations. “Obviously, if all the federal funds were eliminated, it would significantly affect our district.”
The district isn’t anticipating losing all federal money, but Marchetti said the school system is aware of potential reductions. “We won’t be able to make budgeting decisions until we know what that final number will be.”
Kentucky Department of Education (KDE) Spokesperson Jennifer Ginn told The Sentinel in an early-February email that neither ED nor the USDA had informed KDE that any federal funding would be lost.
“No one knows what’s going to happen, but everything is pointing toward less,” said Jason Bailey, founder and executive director of KyPolicy.
“We know that there are significant cuts already happening,” he continued, pointing to eliminated positions at ED and proposals to dismantle the agency entirely, which Trump said he supports.
Proposed federal legislation from Senator Rand Paul (R-KY), introduced in the previous congressional session, would divert public funds to private or homeschool education (S.5458). Congressman Thomas Massie (R-KY, District 4) in February reintroduced his bill, H.R.899, to terminate the ED on Dec. 31, 2026.
Both bills have been introduced in previous sessions of Congress but could find new life with Republican control of both houses and alignment with the Trump Administration’s goals. On Friday, Feb. 28, ED employees received an offer for a $25,000 taxable payment to resign or retire by Monday, March 3, ahead of “very significant” reductions.
“Federal funding fills critical gaps,” Bailey added. “It doesn’t just subsidize the free and reduced lunch kids, it subsidizes all the kids. The federal government also provides extra aid to students who most need the help and are more expensive to serve – those who have low incomes and disadvantaged backgrounds and kids with special needs.”
MSU Associate Professor of Economics Dr. Eran Guse is skeptical that the federal Department of Education is necessary. “Each state already has its own department of education. Why would you have to have two bosses for the same thing?”
Guse, whose children attend MISD, suggests that freeing funds from bureaucracy at the federal level could lower federal taxes. Requiring students to pay more for extracurricular activities or only providing school meals to those in need could also free up some funds spent locally, he said.
Both CCSD and MISD provide free breakfast and lunch to all students without collecting applications as part of the USDA’s Community Eligibility Provision. Schools that adopt CEP are reimbursed based on the percentage of students who typically qualify for free meals through programs like Supplemental Nutrition Assistance Program (SNAP) and Temporary Assistance for Needy Families.
Guse also contrasts the significant investment in education from the federal government with “flat” test scores. “(ED) threw a ton of money at it, but didn’t fix the problem,” he said.
More eighth graders are reading below the Basic standard for their grade level now than since the Nation’s Report Card first assessed the metric in 1969, the National Center for Education Statistics announced in January. The percentage of fourth graders who scored below Basic in reading was also the largest in 20 years. Average math scores increased by two points for fourth graders since 2022, but eighth grade scores had no statistical change.
“State educators need to figure out how we can be more efficient,” Guse said, although he acknowledged that taxes could increase at the state or local level to make up for lost federal funding.
Ginn, the KDE spokesperson, said that the single-largest expense for any district is for educators and support staff.
MISD, which did not respond to requests for comment, received $1.1 million from the USDA for student meals and food service in 2024. The district serves around 1,900 students, 50% of whom are economically disadvantaged. ED will fund $1.1 million of MISD’s budget in 2025, equivalent to 11 educators and support staff, KyPolicy data show.
“We do not have any wiggle room to cut staffing at our school cafeterias, so we would have to look at other options to save money,” said CCSD Food Service Director Megan Adams.
With food costs rising “astronomically,” Adams said the district might consider increasing prices for a la carte and adult food options if it receives less federal funding.
“Free/reduced meals are so important to our community and our students,” she added. “We are closely monitoring the situation with CEP and hope that we still would be able to participate in the program going forward.”
Despite Kentucky’s budget surpluses for four consecutive years, the General Assembly has not increased education funding on par with need or higher costs of living, according to KyPolicy’s Bailey. Teacher salaries are 20% lower than they were in 2008 when adjusted for inflation, he said.
Average teacher pay in Kentucky ranks 41st in the nation. New teacher pay is 45th, and educational support pay is 47th, according to the National Education Association.
Low pay is likely one reason Kentucky faces a statewide teacher shortage. Only one of 171 districts in Kentucky reported being fully staffed as of Sept. 1, 2024, a KDE survey shows. CCSD has 12 open positions on its site, the bulk of which are for substitute teachers. MISD has posted four positions in 2025.
Fewer teachers could also have long-term effects on the local economy. Retired teachers from both districts and MSU received pension benefits of more than $30 million in FY2024. The vast majority of those retirees – 94% – still live in the county, a Kentucky Retired Teachers Association member confirmed.
“The economic impact [of federal funding cuts] is less money in the community for education. It also means fewer jobs in the school system, potentially higher property and local taxes, and higher lunch fees,” Bailey concluded.
Editor’s note: This is the first of a two-part series. Part two will explore the economic impact of federal funding cuts on Murray State and the ripple effects in the community.
