Borough commits to school funding

The Kenai Peninsula Borough Assembly committed to spending at least $48.3 million on education in fiscal year 2018, a slight increase from fiscal year 2017.

The assembly passed a resolution committing funding to the Kenai Peninsula Borough School District at its Tuesday meeting for the 2017–2018 school year, despite not having yet passed a budget of its own. Every year, the borough kicks in a significant portion of the school district’s budget, comprising about two-thirds of the borough’s own budget.

In fiscal year 2017, the borough contributed $48.2 million to the school district’s operations. That wasn’t the maximum amount the borough could have contributed under state law, commonly called the cap, but the assembly chose to move cautiously and not raise funding to the district because of concerns surrounding the state’s fiscal crisis. The actual amount of the cap varies from year to year based on state funding, as the local contribution is determined by a formula based on the state’s budget.

This year, Borough Mayor Mike Navarre requested the assembly raise the funding to the school district by approximately $1.5 million, to approximately $49.7 million. Providing the additional funding, and providing it before the borough or the state reach budget deals, provides the school district administrators some certainty about funding and allows them to move forward with hiring teachers before all the most qualified ones find other jobs, he said.

Navarre said the school district has been spending out of its fund balance for several years, which reduces the amount the district has in reserve in case of unexpected expenses or shortfalls.

“If we fund to the same level as last year, it will be using $800,000 of their fund balance,” Navarre said. “They used a portion of their fund balance every year for the last five years, so they haven’t been growing their fund balance. It’s been actually (being reduced).”

The Board of Education finalized its own budget in April, and once it has submitted a funding request, the borough has 30 days to reply before the request is automatically approved. Throughout the budget process, the district administrators and Board of Education members have repeatedly asked the borough to fund the district to the cap, citing the district’s ongoing use of the fund balance and the uncertainty from the state.

Superintendent Sean Dusek reiterated the district administrators’ concerns at the assembly meeting Tuesday night. He said the district administrators and the Board of Education understand that money is tight for both the borough and state, but as expenses increase, the school district cannot maintain the same services with flat funding.

“When we do have flat funding, we do experience a cut,” he said. “We’ve already built in $2.6 million worth of cuts to our budgets. With this increase proposed by the mayor, we would be able to move forward on hiring some positions … the longer we wait, the less likely we would have quality candidates available for our students in the fall.”

Under the current budget, the district has an approximately $7 million fund balance, but will spend some of that and is holding $3 million of that down in to hire 30 teachers, depending on how much funding the borough and state commit, Dusek said. Each new full-time equivalent teacher costs about $100,000, between salary and benefits.

“You have the opportunity to provide our district certainty that the state is not providing,” he said. “That is very, very important for our students.”

Those aren’t additional positions — the school district has already cut a number of positions in response to budget reductions from the state. A new two-tier bus system on the lower peninsula is estimated to save an additional $600,000 per year, Dusek said. The district is also reevaluating other places to save, such as raising fees for school lunches and for the use of theaters and pools. The district has been spending out of the fund balance for the past several years, equivalent to deficit spending, in large part because of the escalating costs of health care benefits for school district employees.

One catch to the originally proposed $49.7 million was that Navarre said he intends to propose a .5 mill property tax increase to help compensate for some of the additional funding, raising about $4.25 million in additional tax revenue annually. Assembly member Jill Schaefer proposed the amendment lowering the mayor’s initial funding amount but raising it $100,000 from last year, saying she could not in good conscience raise taxes on a community in a recession.

“The state is facing a huge deficit,” she said. “People aren’t cutting from education because they want to — the money is not there. Quite frankly, raising taxes right now on a community that is already facing layoffs and people moving is the wrong decision, and I cannot do it. I can’t.”

Navarre said the assembly could raise the funding at any time in the school year if it chose to do so, and not raising education funding would decrease the pressure to raise the mill levy. Schaefer’s amendment passed 6-3, and the lesser funding allocation of $48.3 passed unanimously.

The assembly is just starting in on its own budget process. After two days of department-by-department breakdowns, the assembly voted to introduce the mayor’s proposed budget Tuesday and set it for hearings on May 16 and June 6.

Significant issues facing the borough include declining state and federal grants, increased burden on local governments to fund pension obligations, increased demand on fire and emergency services and long-term budget sustainability. Major capital projects on the docket this year are plans to expand the Central Peninsula Landfill, plan for expansion of the two borough-owned hospitals, purchasing new equipment for Central Emergency Services and plan the construction of a new fire station for the Nikiski Fire and Emergency Service Area.

Reach Elizabeth Earl at

More in News

Golden-yellow birch trees and spruce frame a view of Aurora Lagoon and Portlock Glacier from a trail in the Cottonwood-Eastland Unit of Kachemak Bay State Park off East End Road on Sunday, Oct. 3, 2021, near Homer, Alaska. (Photo by Michael Armstrong)
State parks advisory boards accepting applictions

Alaska State Park advisory boards provide state park managers with recommendations on management issues

A recently added port-a-potty is available in the parking lot of Slikok Multi-Use Trails on Thursday, Feb. 2, 2023, in Soldotna, Alaska. (Jake Dye/Peninsula Clarion)
Slikok makes sanitation upgrades

A port-a-potty was installed to due to the increased popularity of the trails

Sen. Dan Sullivan speaks at the Kenai Classic Roundtable at Kenai Peninsula College on Wednesday, Aug. 17, 2022, near Soldotna, Alaska. (Ashlyn O’Hara/Peninsula Clarion)
Local students nominated to compete for appointments in military academies

Students interested in pursuing appointment to the military service academies can apply for nomination through their state’s congressional delegation

Kenai resident Barbara Kennedy testifies in support of allowing more city residents to own chickens during a city council meeting on Wednesday, Feb.1, 2023, in Kenai, Alaska. (Ashlyn O’Hara/Peninsula Clarion)
Kenai council bumps back vote on chicken ordinance

The ordinance would allow Kenai residents to keep up to 12 chicken hens on certain lots

Sens. Löki Tobin, D-Anchorage, right, who chairs the Senate Education Committee, and Bert Stedman, R-Sitka, co-chair of the Senate Finance Committee, discuss a bill proposing a nearly 17% increase in per-student education funding Wednesday at the Alaska State Capitol. (Mark Sabbatini /Juneau Empire)
State Senate bill would bump per-student funding amount by $1,000

If approved, the legislation would bump state education funding by more than $257 million

Recognizable components make up this metal face seen in a sculpture by Jacob Nabholz Tuesday, Jan. 31, 2023, at the Kenai Art Center, in Kenai, Alaska, as part of Metalwork & Play. (Jake Dye/Peninsula Clarion)
Metalwork gets time to shine

Metal is on showcase this month at the Kenai Art Center

This 2019 aerial photo provided by ConocoPhillips shows an exploratory drilling camp at the proposed site of the Willow oil project on Alaska’s North Slope. The Biden administration issued a long-awaited study on Wednesday, Feb. 1, 2023, that recommends allowing three oil drilling sites in the region of far northern Alaska. The move, while not final, has angered environmentalists who see it as a betrayal of President Joe Biden’s pledges to reduce carbon emissions and promote green energy. (ConocoPhillips via AP)
Biden administration recommends major Alaska oil project

The move — while not final — drew immediate anger from environmentalists

Homer Electric Association General Manager Brad Janorschke testifies before the Senate Resources Committee on Wednesday, Feb. 1, 2023, in Juneau, Alaska. (Screenshot via Gavel Alaska)
Senate group briefed on future of Cook Inlet gas

Demand for Cook Inlet gas could outpace supply as soon as 2027

Most Read