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Alaska school administrators warn of serious consequences without a substantial funding boost

Mar. 6—JUNEAU — Administrators from six Alaska school districts told state senators Tuesday about the serious fiscal challenges they are facing if a substantial school funding boost is not approved this year.

The Legislature last week passed the largest nominal school formula funding increase in state history through Senate Bill 140. The next day, Gov. Mike Dunleavy threatened to veto the bill unless legislators passed his top education priorities before a March 14 deadline.

The Anchorage School Board assumed a modest funding boost would be approved this year before passing a preliminary budget last week. That addition avoided some of the most painful cuts that had been considered, such as reductions to gifted and talented programs and increases to class sizes.

Still, significant cuts are planned and the district is slated to use $71 million in savings to fund the next fiscal year's budget, which Andy Ratliff, Anchorage's chief financial officer, said would be problematic.

"This isn't best practice for us to be burning our fund balance down to near zero," he told the Senate Finance Committee.

School districts maintain fund balances partly as accounts of last resort for emergencies and partly for day-to-day cash flow management.

A $680 boost to the $5,960 Base Student Allocation — the state's per-student formula — was included in SB 140 at a cost of $175 million per year, which was half of the annual increase that education advocates said was needed after six years of virtually flat state funding.

School administrators spoke about the impact of rising fixed costs like health insurance and said a $680 BSA increase could help avoid excessive draws from their fund balances. But Ratliff said that level of funding increase would still leave Anchorage on track to exhaust its fund balance by 2026.

Student enrollment in Anchorage has dropped 10% over the past 10 years, which has exacerbated the district's fiscal challenges, Ratliff said. He said discussions are set to take place in the next few weeks about school consolidation plans in Anchorage.

The Matanuska-Susitna Borough, meanwhile, has bucked the trend of declining student enrollment and has reported a 54% jump in student numbers since 2000. Superintendent Randy Trani said the district has generally managed flat state funding by not adding to the budget.

"As we've had more students come to the district, we just haven't hired staff as fast as the students have come," he said. "And that's the way we're managing this funding situation."

With flat state funding, Mat-Su school administrators are projecting a $30 million deficit. Trani said that with a $680 BSA increase, the district would still need to draw $6 million from its fund balance. The district reports having just over $5 million available to spend from its fund balance above a minimum required by the borough for emergencies.

In Ketchikan, more than 50 positions were eliminated last year, including teachers, maintenance staff and administrators, said superintendent Michael Robbins. The district has already drawn down its fund balance to zero, meaning without a significant funding boost, deep cuts to popular programs could come next, he said.

"We're literally hand to mouth when it comes to what we're doing in our school district," Robbins said.

At Kodiak Island Borough School District, if school funding is not increased substantially "it's going to be a dire situation," superintendent Cyndy Mika said. She said discussions would turn to closing one of the city's elementary schools.

The district, like others across Alaska, has struggled to recruit and retain teachers and has relied on educators from the Philippines. Kodiak administrators have gone one step further than other districts in seeking staff from the Philippines.

"For the past two years, we've traveled to the Philippines and we have conducted our own job fairs there," Mika said, adding that the district has sought teachers from rural parts of the country to ensure they can adjust to living and working in Kodiak.

Rural Alaska school district administrators told lawmakers about dilapidated buildings and painful cuts that have already been made. Madeline Aguillard, superintendent at Kuspuk School District, said the tiny district based in Aniak already has no advanced foreign language classes or music programs.

"We actually built a school without a library because we know we can't staff it. We can't afford it," she said.

Aguillard said a $680 BSA boost would allow the district to maintain what it is currently doing, but that school buildings are "falling down around our students."

Kotzebue school administrators spoke about similar long-running infrastructure challenges.

"Several of our schools have outdated heating controls, outdated fire panels, and our teacher housing — got to watch where you walk, because your foot is gonna fall through the floor if you step in a certain area," said Terri Walker, superintendent of the Northwest Arctic Borough School District.

Walker said the district wants to buy a roughly $350,000 backup generator for Kobuk because schools are often the safest places in Western Alaska for refuge during an emergency.

She said a $680 BSA boost would still leave the district with a projected $9 million deficit, which she said meant class sizes would increase and there would be cuts to counseling and career and technical education — among other planned reductions.