The Kenai Peninsula Borough School district may tap $2.5 million from its reserves to meet expected costs for next year according to preliminary budget estimates.
District administrators said this assumes the district is funded to the "cap," the maximum amount local government may contribute to the district budget, according to state statute.
Dave Jones, assistant superintendent for the district, indicated at a school district's Board of Education work session on Monday, that if the district was not funded to the cap, they would have to make up the difference by digging deeper into their fund balance, or by cutting programming.
The district's current undesignated fund balance is about $4.6 million.
The preliminary fiscal year 2011 budget is a proposed $128,983,838, or an approximately 2 percent increase over last year's budget.
Jones said the increase is less than the Anchorage area consumer price index increases seen over the same time frame.
He said the increases to expenditures were largely a result of anticipated increases in salaries and benefits.
"When you look around the state it's very reasonable compared to what other entities are doing," Jones said.
More than 75 percent of the district's expenditures are dedicated to salaries and benefits.
On the revenue side, the majority of the district's projected income is supplied by the state, to the tune of $79.6 million.
If the district requests, and gets funded to the cap, they would ask for an amount totaling $45,251,135.
Last year the district was funded $277,818 under the cap. This year the increase would amount to $2,267,759 over last year.
The district is projecting to bring in $450,000 through federal funding, $1,146,000 from other sources and $2,531,115 from their fund balance.
The district held a number of community meetings around the Peninsula in the last month in an effort to educate the public on the budget process.
Board member Bill Holt, of Kasilof, said one concern he had heard was questions regarding the amount administrators were compensated.
Board members Liz Downing, of Homer, and Sunni Hilts, of Seldovia, requested that in future discussions Jones break out administrator compensation in expenditure charts and media.
"Historically when the Kenai has been compared to other large districts across the state the number of administrators has been less in Kenai than in other areas, specifically in central office," Jones said.
Jones said the district's administrators were trying to respond to those concerns nonetheless, and pointed to the recent restructuring of the district's administration as proof.
The board will next hold a joint work session with the Borough Assembly on Feb. 16. On March 1 the district administration will present the board with a detailed budget, which they will vote on in their April 5 meeting.
The assembly will then vote on the amount they'll fund the district to on June 8.
Dante Petri can be reached at firstname.lastname@example.org
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