District sets aside money

Posted: Wednesday, September 10, 2003

Members of the Kenai Penin-sula Borough School District Board of Education voted Mon-day night to set aside about $1.6 million in district savings for upcoming increases to employee retirement funds.

The decision did not come without some reservations, though.

The board of directors for the Alaska Public Employees' Retire-ment System and Alaska Teachers' Retirement System recently voted to increase employer contribution rates for pension plans and retirement health care benefits. The decision, made due to shortfalls in the statewide accounts caused by rising health care costs and poorly performing investments, increases the employer contributions for PERS by 5 percent and the rate for TRS by 4 percent, effective July 1, 2004.

For the school district, that means an additional expense of nearly $1.9 million in fiscal year 2005, according to preliminary calculations by Melody Douglas, the district's chief financial officer.

Douglas recommended that the board approve setting aside $1.6 million in the district's fund balance -- essentially, its savings account -- to help deal with the issue.

"It's obvious we don't have the funds to handle this, so we need some sort of plan," she said.

At present, the fund balance is about $6.6 million strong, though some of that money already is designated for future expenses, such as equipment purchases and for possible rainy day situations, such as an interest shortfall.

Designating $1.6 million for PERS and TRS would leave a little more than $500,000 in the fund, though the designation will not cover the entire cost of the rate increase, Douglas said.

"That's a challenge before us," she said. "But I couldn't recommend taking the fund balance below $500,000. That's just too far."

Board members said designating the money for PERS and TRS is the responsible thing to do, but they still hesitated with the decision.

"This is another one of those times we seem to go through a lot in this district," said board member Deborah Germano. "We know fiscally it's the right thing to do, but I really have a problem with this. Taking this money and setting it aside is the right thing to do, but this is going to be an issue across the state this year, and our kids in this district get to pay for it.

"It's got to be done, but it's wrong."

Board Vice President Sammy Crawford said she agreed.

"I hope we can work with the Legislature to have this changed," she said. "This is taking teachers out of the classroom."

The $1.9 million increase is the equivalent of about 30 full-time teachers, Douglas said.

The board voted 6-1 in favor of the recommendation, with Germano casting the only negative vote.

However, the board also took a step toward seeking relief for the added expense.

Monday night, board members voted on proposed resolutions from the Alaska Association of School Boards (see related story, page A-1) and in addition to approving several measures, board members added a resolution pertaining to PERS and TRS.

The resolution, which will be introduced with a number of others at the statewide board meeting later this year, asks the Legislature to help school districts by allocating more money to school districts to help cover the expense and by raising the employee contributions to the funds as well.

Douglas explained that employer rate increases can be made by the PERS-TRS board but employee rate increases must be voted on by the Legislature.

In other business Monday night, the board:

n Held a preliminary discussion on staffing for the 2004-05 school year. Pupil-teacher ratios, as well as formulas for custodian, secretary and counselor assignments already have been altered reducing staff for the 2003-04 school year. However, the PERS-TRS expenses, combined with continuously declining enrollment in the district, makes further adjustments likely for the 2004-05, according to district administrators. Though school board members said they were loath to take any more teachers out of classrooms, they also said they could see few other ways to cut spending in the district. The informal discussion was designed to allow board members and administrators to vent problems and ideas, and no decisions were made. However, further discussions likely will occur throughout the school year.

n Approved a $50,000 budget transfer to begin a budget for the district's contribution to Project GRAD Kenai Peninsula. The money is part of the district's Learning Oppor-tunity Grant funds and originally was designated for summer school, though Superintendent Donna Peterson explained that the program's summer institutes will replace summer school for most of the students involved. The transfer was passed 6-1, with board member Margaret Gilman casting the dissenting vote. "I am absolutely in favor (of Project GRAD). I think it's going to do wonderful things for schools," she said. "I just didn't want to spend any money."

n Approved nontenured teaching assignments for Renee Merkes, math teacher, Skyview High; Emily Sims, home economics teacher, Skyview High; Matthew Widaman, athletic director-teacher, Skyview High; Stephanie Zuniga, specialist-teacher, McNeil Canyon Elementary; Carol Boehmler, fourth-grade teacher, Mountain View Elementary; John DeVolld, third- and fourth-grade teacher, Mountain View Elementary; Tanya Erwin, Title I teacher, Mountain View Elementary; Mary Alice Allman, generalist, Spring Creek; Gary Blount, generalist, Spring Creek; and Karen Tolman, Title I teacher, Razdolna School.

n Approved new teacher assignments for Michael Wood, vocational education and technology, Homer High; Lois Bisset, special education, Kenai Central High; Darlene Stoddard, Title I, Nanwalek; Kristine Barnes, fourth grade, North Star Elementary; Christian Black, upper elementary, Port Graham; Jaimee Coon, language arts, Skyview High; Vicki Hollingsworth, Title I, Soldotna Elementary; and Michelle Gor-manous, psychologist, districtwide.

n Approved a 21-day unpaid leave of absence for Robert Duesman, head custodian at Seward Middle School and a one-year unpaid leave for Kim Hiler, Soldotna High School secretary.

n Approved resignations from Matthew Neagley, generalist at Nanwalek, and Jane Teller, third- grade teacher at Kalifornsky Beach Elementary School.

n Approved the district's construction advisory committee's recommendation of Architects Alaska as the architect for the new Seward Middle School. The contract bid now will go before the borough assembly.



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