School budget woes worsen

Posted: Thursday, January 29, 2004

Despite rumors floating around the Kenai Peninsula Borough School District, the school board on Monday night will not consider consolidating or closing any area schools, the district announced Wednesday.

In fact, the consolidation discussion a topic of much debate over the past year is being taken off the table, according to district superintendent Donna Peterson.

While some district employees and community members opposed to the idea may be breathing a premature sigh of relief, Peterson said the board will hear even worse news Monday.

Consolidation had been one of three areas where the district has been looking to save money. Facing a $5 million deficit in the 2004-05 budget and with more money woes expected to come every saved penny is important. Now, without consolidation as an option, Peterson said she doesn't know how the district will make up for its shortfall.

The problem came to light just days ago, Peterson said.

After hearing from both the school board and the budget review committee analyzing the FY05 budget, Peterson said administrators began looking for ways to speed up the consolidation effort.

She said they started by looking at the issue from an instructional standpoint. Research of best practices indicate that the ideal school size is 350 to 500 students for elementary schools and 700 to 900 students for middle and high schools. Those numbers allow schools to provide comprehensive programs, such as art, library, music, physical education, vocational education and advanced placement courses along with "the basics."

At present, only three of the 43 school sites in the district Kalifornsky Beach and Redoubt elementary schools, as well as the soon-to-be-consolidated Nikiski-North Star elementary school meet that criteria, Peterson said.

She said staff analyzed possible reconfigurations of schools by pretending to "start from scratch."

"We asked ourselves, 'If we were starting from scratch, knowing the enrollment trends, where would we put the buildings?'" she explained.

Under that criteria, Peterson said administration came up with nine sites that could be closed starting in the fall providing an opportunity for comprehensive programs at all area schools. Those sites included Razdolna Elementary, Paul Banks Elementary, Chapman Elementary, Nikolaevsk School, Cooper Landing Elementary, Moose Pass Elementary, Sterling Elementary, Tustumena Elementary and Skyview High schools.

Plans already are under way to consolidate Nikiski Elementary with North Star Elementary in the fall.

Then, she said, administrators looked at the plan from a business perspective. They looked at how the district could run more efficiently by closing those schools. For example, school closures would mean fewer custodians, secretaries and administrators, as well as decreased operational costs, such as utilities.

That analysis indicated that closing the selected schools could save the district $3 million a year, starting in the 2004-05 school year.

"So we're off and running," Peterson said.

Finally, administrators used a third filter to "double check" the plan, and that's where the problem materialized.

Under the complex formula the state uses to fund schools, buildings with fewer students receive more money than those with more students. The rationale is based on the principle of economies of scale, meaning it costs less to educate a bunch of students at one site than a few students at many sites.

However, that rationale means a glitch for the peninsula. The consolidation plan would have put the reconfigured schools into instructionally sound categories of school size.

Under the funding formula, however, it would have cost the district state income.

While the district would have saved $3 million in expenses, it would have lost $3.5 million in revenue. Ultimately, what the district believed would have been a more efficient model of education would have meant a net loss of half a million dollars.

"It is not a viable option for us to consolidate," Peterson said.

That's both good news and bad, she said.

"We aren't going to have the emotional upheaval of consolidation," she said.

And, she added, the revelation validates the district's claim that it is running efficiently.

"The state is going to be pretty surprised by this, too, when they see it in black and white that we really have been efficient in our own way with the rules we're playing by," she said.

"It means all of the decisions that have been made are right. We are as efficient as we could be."

However, she said, the new information also means a serious problem for the district: "Now we have to find another way to save millions of dollars," Peterson said.

The options aren't promising, she said.

Consolidation has been one of the "big three" areas where significant cuts were deemed possible in the district budget. The other two are cocurricular activities and the pupil-teacher ratio.

The district may get some help with cocurricular activities in the near future, if voters approve a special ballot measure that would allow the borough to provide a special revenue fund for sports and other educational activities.

The measure would authorize the borough to increase property taxes by .5 mills, the equivalent of $50 per $100,000 of assessed property. That money would be used specifically for cocurricular activities.

However, Peterson said she's not sure voters are sold on the idea yet. She said some people believe the activities could be picked up by nonprofit groups or booster clubs. That's unlikely, she said, considering the vast range of programs offered and the coordination they require.

Others, she said, believe education is a state responsibility and local community members should not be required to pick up the bill just because the state isn't meeting its obligations.

Yet others simply don't understand the extent of the problem.

She said about 72 percent of students participate in the activities, which provide not only educational and social value, but also a safe place for kids throughout afternoon and evening hours.

Without the activities, she believes the district could lose as many as 10 percent of its students.

"If we don't have activities, why would they stay?"

If voters do approve the measure, it could save the district about $1.4 million in the FY05 budget.

That leaves more than $3.5 million to cut.

The final of the "big three" the pupil-teacher ratio is an area administrators and board members have said they will do anything to preserve. The PTR was increased last year, raising the number of students in classes this fall.

But as much as the district would like to avoid a repeated increase, Peterson said she doesn't think it's possible.

"I think we're going to have to hit it before we're done," she said.

Raising the PTR by one student per teacher, however, only saves about $700,000. Peterson said PTR alone simply can't make up the difference in the budget.

"No decisions being made right now are necessarily good for children," she said. "We've pulled all the rabbits out of our hat. I think that's the piece that's going to be a shock to the public."

Most likely, she said, cuts will come from staff. More principals may become half-time teachers. The district media center may disappear. Central office and special education staff may get axed. The 113 nontenured teachers in the district likely will get pink slips and programs such as Quest probably will disappear.

"What it looks like for an individual school? (Kenai Central High School) may offer graduation requirements and nothing else," she said.

"Schools look a lot different than last year, and they're going to keep looking more different."

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