The Haines Borough Assembly and Haines Borough school board held a joint meeting Tuesday night and together emphasized what was of no surprise to anyone in the room: neither entity is expecting a budget surplus next year.
The borough and school board meet jointly once a year, usually in late spring and after the borough budget has gone through much of its formation. This year the school board requested meeting earlier in the year to make its case to the borough about the importance of education funding.
“At our last meeting (in January) when we talked about the budget situation, I think we all recognized that we are in the preliminary steps of this process,” board member Anne Marie Palmieri said Wednesday. “There are so many unknowns: We don’t know if base student allocation is going up, how many kids we’ll have next year. What we need to be doing is just starting the conversation. That was the hope and goal for (the meeting).”
Last year the borough contributed $1.7 million to school district funding. By state law, the borough is required to provide between $1.54 and $2 million to the district. school board member Sean Cone noted that while the $1.7 million is above the minimum of what is required, the borough has steadily been decreasing its contribution within that range over the years.
“The borough’s contribution has been slowly eroding,” he said.
Superintendent Michael Byer detailed to the assembly the school district’s estimated budget for fiscal year 2013. With Gov. Sean Parnell’s proposal to flat-fund public education for next year, a reduction or expiration of some federal grant money, increased energy costs and regular step increases for staff, Byer is estimating the district will have to use half of its $472,000 reserves to cover its gap in revenue and expenditures.
“I think we’ve done a good job maintaining a healthy reserve but it’s an area of concern for us because we can’t deficit spend and carry a reserve,” Byer said.
Parnell has expressed support for a one-time increase in the student base allocation, and the state legislature has a bill to that effect going through committee, but it’s unclear if that bill will survive.
Borough manager Mark Earnest said the borough budget process is not yet at the point of designating expenditures and couldn’t estimate if - or by how much - its contribution to the school district will fluctuate in 2013. However, he said early estimates are that the borough’s general fund revenue will decrease by about 10 percent.
“We’re fighting an uphill battle,” he said.
Earnest said the borough has a 2 percent wage increase built into its fiscal year 2013 budget as well as an expected increase in employee health insurance premiums. Additionally, Earnest said the borough is not budgeted to receive any more Secure Rural School entitlement program funds, a funding source that provided just under $380,000 this year. The borough also received this year about $200,000 from an Alaska state supplemental revenue sharing program for municipalities, money that is not expected in 2013. With fixed costs increasing by about $200,000, Earnest said the borough is estimating a decrease of about $750,000 in revenue.
“It’s looking pretty tough,” Earnest said.
school board member Brenda Jones tried reframing the funding challenge as an opportunity to emphasize what is important to the community. She said with the borough’s 10-year comprehensive plan currently being developed, the community should include education in its top priorities.
“We can control where the money is spent and it’s a matter of prioritizing,” she said.
Before discussing the budget, the assembly and board came to agreement on other matters, including formulating a way to distinguish maintenance issues. The borough, by state law, is required to provide or fund “major” maintenance to school facilities. The school is responsible for “minor” maintenance. But in past years, that distinction has been too vague to provide much guidance, Byer and school board members said. Earnest said he’s been researching how other municipalities and school districts define the difference. The board and assembly together approved a motion that directed Byer and Earnest to create a plan by April 1 that would more precisely define major and minor maintenance.
The school board also encouraged the assembly to be more vocal in its support for increased education funding on the state level. The board recently sent a letter to Gov. Parnell in support of forward-funding education and several board members are traveling to Juneau this legislative session to push for that support in the legislature.
“I think as a community we should rally around that particular cry,” Jones said.
The assembly unanimously approved a motion to draft a resolution at its Feb. 14 meeting in support of forward-funding education and an increase in base student allocation from the legislature.
Mayor Stephanie Scott ended the joint meeting by proclaiming February 2012 as school board recognition month. She drafted the proclamation “in gratitude of the education leadership of the Haines School Board.”