Juneau’s school board looks at savings to plug $5.1M deficit; other districts are facing tougher options
- Mark Sabbatini
- 2 hours ago
- 4 min read
77% of districts in state survey say they expect deficits, with some considering closures and layoffs; JSD leaders set to hear public testimony and vote on FY27 spending plan Tuesday
By Mark Sabbatini
Juneau Independent
Juneau School District leaders are scheduled to vote Tuesday on an $81.2 million budget for next year that has a $5.1 million deficit, but have the comfort of knowing there’s enough cash in the bank to cover the shortfall.
That’s not the case statewide.
Nearly 80% of 44 school districts responding to an Alaska Council of School Administrators survey say they expect deficits for the fiscal year starting July 1 — and many are planning school closures, employee layoffs and cutting student activities to meet the state’s balanced budget requirements.
The Anchorage School District, for instance, is coping with a projected $90 million budget by closing three elementary schools and laying off more than 500 employees, including 300 teachers.
The Sitka School District is facing a $2.1 million shortfall that includes a conservative 10% increase in health insurance costs which already have risen 30% the past two years. of 10%. To address a $5 million shortfall in a $64 million budget, the Lower Yukon School District plans to "increase classroom size and reduce programs for students and absorb positions through retirements and transfers."
Juneau went through a painful budget crisis two years ago when a projected shortfall of roughly $10 million resulted in a consolidation of schools and other cost-saving measures. The district and others across the state got some relief that year — and during last year’s budget process — when state lawmakers approved increases of about 11.5% in per-pupil funding that became permanent as of this year.
The problem, according to many school district officials and like-minded legislators, is a historic increase in per-student funding that took effect last year isn’t enough to offset the erosive effects of inflation after going nearly 15 years without a significant increase.
"I would like to express my sincere gratitude for the increase to the BSA last year — it provided much-needed funding for schools and districts across our state," said Elizabeth Kvamme, principal of Sterling Elementary School in the Kenai Peninsula Borough School District, during a House Education Committee meeting where the ASA survey results were presented. "However, without additional funding, schools like mine are set to close this upcoming school year."
A $700 increase in what was a fixed $5,960 Base Student Allocation took effect last August when legislators overrode a veto by Republican Gov. Mike Dunleavy to $200 of that increase. Monday’s survey review and testimony by school officials occurred as the Education Committee was considering a bill raising the BSA by another $630 to $7,290, but took no formal action on.
Dunleavy and legislators aligned with him say the statewide problem isn’t a shortage of per-student funding, but rather policies determining how education dollars are spent. Proposals by him to ease new charter and correspondence schools, and establish open enrollment for students in any district statewide and teacher bonuses, have largely stalled in the bipartisan majorities of the Legislature.
"Personally, I don't know any families that have moved out of state because they don't believe that the education quality is there," Rebecca Schwanke, R-Glenallen, said during Monday's Education Committee hearing. "However, I do know dozens of families that have taken their kids out of brick-and-mortar schools, because they don't feel that the districts are accountable to them as to what kind of quality of education that they would like for their children."
The Juneau School District — reporting a projected $5.36 million deficit in the survey, which occurred before further changes were made ahead of Tuesday’s meeting — stated an additional BSA increase of $864 would be needed for a balanced budget during the coming fiscal year. However, the district is also expected to have a fund balance of about $7.8 million at the end of this fiscal year — due to lower-than-expected personnel costs and other factors — providing breathing room for the school board.
"At this time, the Board of Education is considering utilizing remaining fund balance to cover the FY27 deficit," the Juneau district’s response notes. "Other considerations for reductions include increasing (pupil-teacher ratio)."
The updated budget before the Juneau Board of Education on Tuesday night maintains current pupil-teacher ratios and "largely preserves current staffing levels based on projected enrollment," according to a memo by district administrators. The $5.1 million deficit assumes the BSA will remain unchanged at $6,660 and student enrollment will continue its long-term decline, with 3,767 students attending during the coming year.
A significant remaining unknown in the budget is teacher salaries, due to an impasse in contract negotiations that have been going on since January of 2025. The district last week announced a tentative agreement with Juneau Education Support Staff, which represents 286 of the district’s roughly 600 employees when at full staffing capacity, but negotiations with the larger Juneau Education Association remain unresolved as of Monday.
The school board has scheduled a special meeting for Thursday evening to give final approval of the budget, if still needed after Tuesday’s meeting, before it is sent to the Juneau Assembly for consideration as part of the overall municipal budget. The current proposed budget calls for about $35.8 million in city funds as a primary revenue source in addition to $39.8 million in state funds.
• Contact Mark Sabbatini at editor@juneauindependent.com or (907) 957-2306.
