Borough, district step toward compromise

The school board and the borough each took steps toward middle ground during their second joint work session to determine how much money the district will get from the borough for FY 2022.

At their first joint work session last month, the district requested to be fully funded by the borough at about $53 million. Kenai Peninsula Borough Mayor Charlie Pierce proposed $43 million as a minimum amount.

KPBSD Board of Education President Zen Kelly said during Tuesday’s work session that the board reviewed their initial request over the past couple of days and agreed to approach the borough with a new, lower request of $50 million, which Kelly said they felt was “more realistic.”

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“We would like to start the conversation with a request from the assembly to fund us at our status quo level of what we’ve been funded for the fiscal year that we’re in,” Kelly said. “The maximum allowable could go anywhere in the $53.5 to $54 million range, but we do understand that during these times of economic uncertainty that we want to start the conversation on a more realistic basis.”

Kenai Peninsula Borough Finance Director Brandi Harbaugh said in a presentation during Tuesday’s work session that the borough had also revised its initial proposal and would be able to fund the district at $45 million. Harbaugh said that the borough has traditionally funded the district close to the maximum local contribution amount and reiterated a previous stance that the borough is taking a big financial hit due to a loss in sales tax revenue caused by the COVID pandemic.

The borough saw a 12% decrease in sales tax revenue from the first half of FY 2020 to FY 2021, Harbaugh said Tuesday, though some industries were hit harder than others. Hotels, motels and B&Bs, for example, saw a 48.1% decrease in sales tax revenue during the same period.

In addition to local contributions made by the borough, the district also expects to receive about $82.2 million from the state and about $1.2 million in other revenue that includes things like Medicaid and interest earnings. If the borough funded the district at the maximum amount requested, the district would have $136,484,334 to work with for FY22.

KPBSD Superintendent John O’Brien has previously said that being fully funded by the borough could save up to 100 teaching positions. Pierce has pointed out that the district will receive an additional $9 million in federal CARES Act money that he said they could use to save some of those positions. The district is already planning for a loss of about 48 positions due to a projected decrease in student enrollment. O’Brien countered by saying that those funds are specifically meant to help students who fell behind academically during the COVID pandemic.

Pierce said that he wants the borough to give the district as much as they can, but that there is also the potential for more money for education to be approved at the federal level.

“In the next month or so we could be sitting here saying, well, we don’t have a problem, we can fully fund you. You’ve got CARES money, you’ve got federal money and we’ll still be able to deliver and do what we need to do to make sure kids are taken care of,” Pierce said. “I think there’s more than enough revenue, if my numbers are right, to make sure that we deliver the services.”

KPBSD Finance Director Liz Hayes said during a presentation on Tuesday that remedial programs toward which the district would like to put the first year’s $4.5 million include, among other things, additional interventionists in schools, after-school and summer school programs with transportation and additional elementary, middle and high school counselors.

Assembly member Kenn Carpenter, who represents the eastern peninsula, compared the school district to a child throwing a tantrum by saying that they’d settle for a dollar amount lower than what they initially requested. Instead of using funding for tutors or focusing on small class sizes, Carpenter said, the district should focus on making sure kids don’t fall behind in the first place.

“We still haven’t got our budgeting done,” Carpenter said. “But you’re talking about smaller classes when I think they shouldn’t be smaller classes. We can save money by putting 15 or 20 kids in a class and teach our kids the right way from the beginning.”

The borough mayor is not expected to present his budget to the assembly for approval until May, with the final hearing in June.

KPBSD will also host three community budget meetings in March allowing the public to give input on the district’s budget and budget process. The central peninsula’s meeting will take place on March 23 at 6 p.m. Homer’s meeting will take place on March 22 at 6 p.m. and Seward’s meeting will take place on March 18 at 6 p.m. All meetings will take place via Zoom.

Reach reporter Ashlyn O’Hara at ashlyn.ohara@peninsulaclarion.com.