School district presents proposed budget to MSB Assembly during joint meeting

Just a week after approving the budget for the upcoming fiscal year, the Matanuska-Susitna Borough School District (MSBSD) school board met with the Matanuska-Susitna Borough (MSB) for a joint session in which the school district budget was the singular agenda item.

Todd Smoldon, the Mat-Su regional director for Governor Mike Dunleavy, started off the meeting, offering a perspective from Gov. Mike Dunleavy, saying that HB 69, which includes a Base Student Allotment (BSA) increase as well as some educational reforms that the Governor has proposed, does not appear to have the legislative support needed to pass, nor the support to override a potential veto.

“What I’m trying to say is that as the legislature continues with its process in funding, it’s really important that they also work with the Governor and his team to include reforms.”

Smoldon also said that while the Governor does advocate for additional funding, his office does not want a repeat of last year, when the legislative body passed a BSA-only bill that was vetoed by the Governor and was later upheld by the legislature.

“What we don’t want to see is what happened last year where people are presented with a piece of legislation that they think is somehow going to make it across his desk, only to have that funding not come through. That’s just going to create more chaos, more tension, and makes it more difficult for school districts to budget and plan.”

He said he hopes the legislature continues to work with the Governor and that when there is legislation to put forward, it will be something everyone will agree on, even if not everyone will be happy with it, it will have enough for the legislature and the Governor to support.

MSBSD Superintendent Dr. Randy Trani and Deputy Superintendent Katie Gardner presented the recently approved budget to the MSB Assembly,

“We are at a point and time where we essentially have to guess as to what revenue will be,” said Gardner, explaining that the budget proposal they were presenting was bound to change as state funding has not yet been secured and acknowledging that the MSBSD budget must also go through the MSB Assembly process to determine funding.

“Those two items together really make up about 99% of the school district revenue,” Gardner said.

The district requested a 4% increase in local education funding for FY 26, with Gardner telling the assembly members that most of the request makes up the increase that will be occurring in the required local contribution.

“As that local contribution, which is calculated at the state level goes up, that is an amount of money that is deducted from state revenue that the school district receives.” Meaning every dollar of the required local funding that increases is a dollar that the school district does not receive from the state of Alaska. “If Borough funding doesn’t at least keep up with that minimum required, then the school district receives less funding on an annual basis. We think the 4% we requested is reasonable and keeps us just above that increase in the minimum required local.”

The 4% increase the district brings the district request to $78 million, $3 million above the funding for the current school year, and $500,000 above the total required MSB contribution.

Gardner went on to explain that one of the most important factors that goes into how much revenue the district receives is based on enrollment, and that the enrollment projection for FY 26 was required to be submitted back in November 2024. “Quite a bit in advance of when we’re actually tracking these students.” She went on to say that there was a slight reduction in the number of students enrolled in brick-and-mortar schools, with more students choosing the homeschool route, which Gardner said has a secondary impact on the amount of revenue received from the state.

“As we look at fiscal year 2026, we have a modest, very small increase in enrollment, and most of that increase is because of the estimates that Charter schools anticipate for student enrollment for the subsequent year, and also a secondary increase to Mat-Su Central School.”

The proposed MSBSD budget will be considered by the MSB Assembly, and the public will be able to discuss the school district budget and the MSB budget during a series of public hearings in April.