November 16, 2015
Monday AM

The Ketchikan Daily News editorial of November 13, 2015, took note of the fiscal difficulties facing the State of Alaska and the federal government. It cautioned the City and Borough governments to reach balanced and sustainable budgets. The editorial pleads, "We should take this opportunity to ensure that we can live within our municipal means next year and in the foreseeable future." The Ketchikan Gateway Borough School District (KGBSD) must heed that excellent advice also.

The fiscal environment facing education funding next year is not rosy. In January 2014 (when Alaska's oil sold for well over $100 per barrel) the State House Task Force of Sustainable Education warned that the State couldn't continue to fund education at levels then in place. It is anyone's guess as to what the legislature will do with funding for basic need for education now that oil overs around $50 per barrel.

Following the collapse of oil prices, the 2015 legislature impose a five-year moratorium on new municipal debt for school capital projects that would otherwise qualify for partial funding by the State. Yet, our School District has identified more than $12.5 million in capital projects to be addressed during that five-year moratorium. Borough taxpayers face the daunting prospect of fully funding those projects through higher taxes.

At the same time the Borough faces the distinct possibility that the State may reduce reimbursement of principal and interest payments on more that $23 million in existing school related bond debt approved by Borough voters in prior years. This year, the principal and interest payments on that debt will amount to $3.9 million; nearly $2.7 million of which the Borough is counting on the state to reimburse.

At the federal level, Secure Rural Schools (SRS) funding has decreased by approximately 50% compared the level received in Federal FY2008. Funding for SRS is expected to continue on a downward trajectory. Another critical source of revenue, the federal PILT program has yet to be authorized for full funding during Federal FY2016.

KGBSD's current budget is in excess of $39 million for roughly 2200 students. It is questionable whether this figure is sustainable in the current declining revenue environment; an increase definitely isn't.

The Ketchikan Daily News editorial opened with, "No Virginia, there is no Santa Claus when it comes to budgets." Our School district needs to realize this also.

Agnes Moran
Ketchikan, Alaska

Received November 15, 2015 - Published November 16, 2015

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