LOUISVILLE, Ky. — Mayor Craig Greenberg announced Thursday that he intends to work with local officials to amend a recent ordinance affecting Jefferson County Public Schools (JCPS) and its financial arrangement with Churchill Downs. The move follows mounting concerns from the school district, which was caught off guard by the changes, and the city’s ongoing efforts to address financial challenges.
The dispute centers around a long-standing agreement that exempts the racetrack property from property taxes while providing JCPS with payments equivalent to the tax revenue it would normally receive. However, recent revisions to the agreement have shifted these “payments in lieu of taxes” from JCPS to Metro government, sparking tensions.
Mayor Greenberg defended the changes, stating that the funds would be better utilized by the city, which provides services to Churchill Downs but receives no direct benefit from the land’s tax-exempt status. He emphasized that no schoolchildren reside on the racetrack property, making it less pertinent for JCPS to continue receiving the payments.
However, JCPS officials assert that the 2002 deal between the school district and Churchill Downs remains in effect and that the new arrangement is a breach of that contract. The agreement stipulates that as long as the property remains tax-exempt, JCPS should continue receiving the payments. Since 2005, the school district has received over $9 million from Churchill Downs, with the amount rising sharply in 2019 after reports revealed that the racetrack’s value had not been reassessed for years despite substantial investments.
In light of these concerns, Mayor Greenberg has expressed his commitment to revising the ordinance to ensure a fairer distribution of the funds. In a statement, he acknowledged the potential impacts of federal funding cuts on JCPS and promised to work collaboratively with the school district, Metro Council, and Churchill Downs to find a solution that benefits all parties.
“We are committed to addressing the financial challenges facing JCPS and ensuring that the revised agreement serves the best interests of everyone involved,” Greenberg said.
The new ordinance, which was recently filed at Metro Council, also includes a proposal to extend the city’s ownership of the Churchill Downs property until 2055. This extension is part of Churchill Downs’ request for approval to secure $920 million in funding for construction projects. While the racetrack operator would be responsible for repaying the debt, the city’s approval is necessary to move forward with the industrial revenue bonds.
The proposed changes are set to continue until 2032, the year the current agreement between Churchill Downs and JCPS expires. JCPS, which operates with a $1.9 billion annual budget, has not yet responded to requests for comment regarding the latest developments.
As the situation unfolds, both the city and JCPS are working toward an amicable resolution, but the path forward remains uncertain, with the potential for further negotiations in the coming weeks.
