School district braces for budget cuts

PALMER — The Mat-Su Borough School District is projecting budget shortfalls between $1.9 million and $13.4 million.

“That’s the scary number,” said Mat-Su Borough School District Assistant Superintendent Luke Fulp said of the worst-case scenario.

More likely, Fulp said is the district will be short around $5.9 million. He hopes that’s how this plays out.

But why such a huge spread? The short answer: Juneau.

Lawmakers right now are meeting in a conference committee to sort out the differences between the operating budgets the Senate and House of Representatives passed. Since the majority of the district’s funding comes from the state, and the state hasn’t passed a final budget, it’s not clear at all what the final district budget will look like. But both versions of the budget include cuts to education funding.

On Tuesday the district laid out four scenarios in its budget to the Mat-Su Borough Assembly:

Scenario A: $1.9 million deficit.

In this scenario, the district gets all the money that the Legislature said it would contribute last year in its budget. There’s still a deficit, though, due to rising costs of things like health care and employee salaries, but also because the district’s enrollment continues growing year after year, requiring more schools and teachers.

Scenario B: $5.9 million deficit

This scenario represents the budget that Gov. Bill Walker and the House of Representatives have both signed off on. It strips out some one-time education funding that had been in the budget, resulting in a $4 million reduction for Mat-Su.

Scenario C: $11.9 million deficit

This is the budget the Senate passed. In addition to stripping out the one-time funding, the Senate cut 4.1 percent off the baseline funding of state education, bumping the district’s deficit up $6 million.

Scenario D: $13.9 million deficit

This is where the budget would stand if the Senate budget is the one the Legislature agrees on and if the Mat-Su Borough Assembly also declines to increase by 3 percent the amount it budgets for schools. The district has been consistent in asking the assembly for that increase and, over the past few budgets, the borough has obliged. The district’s stated goal is to bring the borough’s contribution to schools more in line with what other big districts receive from local taxpayers.

Fulp said the Mat-Su Borough School District School Board has already voted that if Scenario B is the one that comes to pass it will pay for that $5.9 million out of its budget reserves to stave off staffing cuts.

“It would mean effectively no positions would be lost,” Fulp said.

But there’s not much more cushioning left in the district’s budget. Fulp said $5.9 million amounts to half of the district’s reserves, which are already well below both the federally recommended figure for the amount of money districts should keep on hand — two to three months of operating expenses — and the state-imposed maximum reserve amount a district can keep — 10 percent.

So what makes the district think the $5.9 million budget hole is more likely than the $13.4 million gap? Fulp said there are some in Juneau saying that the Senate’s education budget cuts are a bargaining chip to get other concessions in the conference committee.

“It’s our hope that the governor’s budget is really what holds in this final week, and that additional 4.1 percent reduction by the Senate is truly a bargaining chip,” Fulp said.

But, he said, in addition to committing to plug that $5.9 million hole, the school board also has said that a budget any smaller than that is going to be painful.

“If additional funding cuts do occur, some school board members mentioned that really everything has to be on the table. They have to consider broader, wide-ranging cuts,” he said.

Contact Andrew Wellner at andrew.wellner@frontiersman.com.