MANCHESTER -Recent property transactions by the Clay County Board of Education have prompted questions about whether school district property must always be advertised for bids or sold at public auction.
Under Kentucky law, the answer is no.
Kentucky regulations specifically provide local boards of education with multiple methods for disposing of surplus real estate, including a process that allows property to be sold directly when the sale price meets or exceeds its appraised fair market value. The Kentucky Department of Education also oversees the disposal process.
Records at the Clay County Clerk’s Office show the district has sold eight parcels since 2014, with another transaction involving the City of Manchester currently pending.
Under 702 KAR 4:090, a local board must first declare property surplus to the district’s educational needs and obtain contingent approval through KDE’s property-disposal process. The regulation then permits three methods of sale: public auction, sealed bids or setting a minimum acceptable price that is at least the property’s fair market value. Fair market value is established through an appraisal by a Kentucky-licensed real property appraiser.
That distinction is important because the advertising requirement applies specifically when a district chooses the auction or sealed-bid method. The regulation requires those sales to be publicly advertised. When the board instead uses the minimum-price method, the regulation requires the appraisal and proposed sale agreement to be submitted to KDE for review and final approval; it does not impose the same auction or sealed-bid advertising requirement.
Clay County has used both methods.
In 2014, during Dr. Amon Couch’s tenure as superintendent, the district was facing serious financial problems following a state audit and was looking for ways to improve cash flow.
The board declared the former Horse Creek Elementary property surplus and offered it at auction. Fred Jackson and City of Hope purchased the property for $550,500. After auction expenses, the district received $521,614.
Board members at the time expressed disappointment that the property did not bring more. Its assessed value was approximately $1 million, and members compared the result with the earlier direct sale of Laurel Creek Elementary to the Church of God for $400,000 during Doug Adams’ tenure as superintendent.
That experience contributed to the board’s preference in later transactions for considering direct offers when they met the property’s appraised value.
Board attorney Sharon Allen said the district has not generally gone looking for buyers for its surplus properties. Instead, the seven properties sold through the minimum-price method were transactions initiated after prospective purchasers approached the district.
County clerk records show those transactions included an August 2014 sale of property on Ky. 80 to James and Angela Mills for $21,000; a January 2017 sale to White Hall Church for $20,000; and the December 2021 sale of a former one-room school that is now the site of Darby’s Branch Church to Marty Jackson for $3,000.
In July 2024, 1 Clay County approached the district about the former “B School” property along the four-lane for development. The board declared the property surplus, obtained an appraisal and sold it for its appraised value of $190,000.
The former Pin Hook School property was sold to Paul and Myra Hughes for its $7,000 appraised value in September 2024.
In February 2025, a former one-room school site on Elisha’s Creek was sold to Hilda Hacker for $4,000. The following month, property adjoining Laurel Creek Church of God was sold to Brad Stevens for $14,500.
The district also has a pending agreement to sell the former Manchester Elementary property and current City Hall location to the City of Manchester for $400,000.
Clay County once had more than 50 schools, leaving the district with numerous former school sites. Some older deeds contained reversionary provisions concerning what happened to property when it ceased being used for school purposes. The Kentucky Legislature abolished that issue and now requires all property sold in one of the previously mentioned processes.
The central issue surrounding the more recent transactions, however, is whether Kentucky law requires every piece of surplus school property to go to auction or be advertised for bids.
It does not.
The current state regulation expressly permits the minimum-acceptable-price method as an alternative to auction and sealed bids, provided the required fair-market-value and KDE approval procedures are followed. KDE approval is part of the process before a district executes a sale agreement.
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