Education

Early projections put Anchorage schools budget gap at $15 million next year

The Anchorage School District has started its budgeting for the 2017-18 school year and early projections put its total budget deficit at about $15.3 million, according to a presentation to the Anchorage School Board this week.

Superintendent Deena Paramo said while enrollment is expected to fall, increases in fixed costs, including electricity and health insurance, are largely driving the multimillion-dollar gap. But with ASD in the early stages of its budget process and with no word expected for months on how much money the state will contribute, Paramo cautioned the recent figures are just the district's best guess.

"We're letting the board know that our system set up the way it is can't keep on that same trajectory," she said in an interview Tuesday. "With the same amount of money at the state and costs going up, obviously there's always going to be a deficit. But what we're looking at are efficiencies in our district, other sources of revenue."

The district built its budget projections around the assumption that per-student funding from the state would remain flat next school year and enrollment would decrease by 270 students. It projected an increase in the use of substitute teachers, with costs rising next school year by 7.2 percent to about $8.6 million. Heidi Embley, school district spokesperson, said more teachers were using their allotted time off.

Paramo said she did not anticipate layoffs for the 2017-18 school year. She said any cuts in personnel would likely occur through attrition as teachers retired or as jobs were vacated and then eliminated entirely.

Andy Ratliff, executive director of the district's Office of Management and Budget, said budget projections accounted for estimated salary increases, but the exact total would not be known until unions negotiated new contracts. The current contracts for teachers, principals, maintenance workers and custodians all expire at the end of this school year, he said.

The projected $15.3 million budget gap is split between a $13.8 million gap in the general fund budget and a $1.5 million gap in the transportation budget for 2017-18. The projected transportation budget total about $24 million, about $13.9 million to be spent on contracted bus services.

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Ratliff said that in the current school year, the district is using its savings to pay for transportation cost increases, including those of salaries and benefits. Ratliff said the budget projections do not include the use of savings — for now.

Paramo said the district will continue to develop its budget through the winter and will seek comment from the community on current school programs. She said ASD will look for ways to increase its revenue, including drawing more students to the district who have left for home-schools or who have left for the nearby Matanuska-Susitna School District, where Paramo previously served as superintendent.

Paramo said ASD lost about 30 students to the Mat-Su district who wanted to enroll in the Alaska Middle College School at the University of Alaska Anchorage's Chugiak-Eagle River campus.

Paramo said the district plans to take over the middle college, opening it to Anchorage students in the 2017-18 school year. The school gives students the opportunity to earn college credits while completing high school diplomas.

"I don't want Mat-Su taking our kids anymore," Paramo said. "When 30 kids leave you, that's a problem."

The Mat-Su district is planning to open a new middle college in fall 2017 at Mat-Su College in Palmer, another UAA branch, said Monica Goyette, Mat-Su's assistant superintendent of instruction.

Ratliff said the district will provide more budget information to the school board over the next few months. The board is scheduled to vote on a 2017-18 budget in February, which will then go to the Anchorage Assembly for a March vote, he said.

At the same time, the Legislature will be in Juneau writing a new state budget. Sen. Anna MacKinnon, R-Eagle River and co-chair of the Senate Finance Committee, said it's too soon to say what the per-student funding will be for the 2017-18 school year, referred to as the base student allocation or BSA.

"Any legislator can introduce any piece of legislation," MacKinnon said. "Which would start the conversation on the BSA going up or going down."

MacKinnon said she had not heard talk of cuts to education yet, but educational outcomes in the state have been a "high level of concern."

Tegan Hanlon

Tegan Hanlon was a reporter for the Anchorage Daily News between 2013 and 2019. She now reports for Alaska Public Media.

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