‘Not a painless path ahead’: Facing $95M shortfall, Anchorage School District again warns of cuts

The Anchorage School District is again facing a major budget shortfall that school board members and district officials say could translate to significant cuts to public education without further state assistance.

Where cuts might be made to address an approximately $95 million budget deficit for the 2025 fiscal year will be decided over the next several months. In February, the district will propose a budget that the Anchorage School Board and Anchorage Assembly will both need to approve.

Possible school programs and support services on the chopping block include the IGNITE program for gifted students, use of The Dome sports complex, language immersion programs, fine arts and summer school, said Andy Ratliff, the district’s chief financial officer, to members of the school board at a recent meeting, adding that is not an exhaustive list.

“There’s not a painless path ahead,” district superintendent Jharrett Bryantt said during a Tuesday school board work session.

However, partially as a result of a growing number of teacher and other staff vacancies, the district says it does have a sizable fund balance from this year’s budget — about $59 million — which officials said could be used to help offset the deficit.

The current high number of staff vacancies in the district also factors in to the lack of competitive benefits and pay for district educators due to the lack of funding, said Cory Aist, head of the Anchorage Education Association, the teachers union that represents district educators.

There are currently more than 300 open positions in the school district, a number that Aist said reflects stagnant employee benefits compared to other districts.

“The (school board) has to prioritize our educators in the budget so that we can be more competitive,” he said. “We are having a hard time hiring educators, and we’re having a hard time retaining them. There are many unfilled positions at all levels. And that’s a savings to the district that our current employees don’t get to benefit from.”

[Anchorage School District and teachers union reach tentative agreement on labor contract]

Even with the fund balance due to vacancies, board members said they anticipate this year’s budget will particularly difficult to balance given years of flat state funding that hasn’t kept pace with inflation, and the drying-up of pandemic relief funds and one-time funding from the Alaska Legislature that in recent years acted as a stopgap for increasing financial woes.

“We’ve got to make some devastating choices,” school board president Margo Bellamy said during a board meeting. “There’s just no way to make up an almost $100 million deficit by remaining status quo. It’s almost impossible.”

The estimated $95 million was a “high-level, preliminary number” that could increase over the next few months based on a number of factors, including unsettled labor contracts, inflation and a drop in enrollment, Ratliff said.

School board member Kelly Lessens said an increase in the district’s pupil-teacher ratio was likely given the scale of the deficit. A higher ratio means larger class sizes and fewer educators. That number already increased last year; the district saved $7 million for a plus-1 increase in that ratio, Lessens said.

“That’s a big addition to your workload as a teacher, and that really diminishes the quality of education that a student would receive,” she said.

The district is required to use the last of its COVID-19 federal relief funds by fall of next year, Lessens said.

“Without those federal relief funds, we are going to confront the reality of our financial situation,” she said. “The cuts are going to be more dire, more acute. It keeps me up at night.”

The district’s deficit has been growing for years. Board members are continuing to advocate for intervention from the Alaska Legislature, which has the ability to override Gov. Mike Dunleavy’s veto this summer of more than $87 million in education funding statewide — and approve a longer-term increase.

The veto cut half of the funding the Legislature had allocated for a one-time increase to the Base Student Allocation, the formula used to calculate school funding.

In January, when the legislative session resumes, lawmakers will have up to five days to consider a veto override, which some have said could happen but is relatively unlikely given the high bar: It requires a three-quarters vote in both the House and Senate.

“We do want to be as transparent as possible, and we want people to continue to voice their concerns, their desires and what they value,” Bellamy added during the Tuesday meeting. “Help this board, this community, advocate to the Legislature to make sure that our kids get what they deserve.”