Chilkat Valley News - Serving Haines and Klukwan, Alaska since 1966

Anticipating a 17-student drop in enrollment, the Haines Borough School District is projecting a $269,000 shortfall in its $4.93 million budget for the coming year.

The gap would be covered by the district’s $848,000 general fund surplus, but school board members at a finance meeting Tuesday cautioned that the district’s surplus would be knocked down to $421,000 this time next year.

“We can’t do this again. It’s not a sustainable budget,” said board member Lisa Schwartz. “Unlike the borough, we don’t have a revenue source. We don’t get to generate more funds. This is what we get to draw from.”

By state law, the district can’t carry a general fund balance that’s more than 10 percent of its annual budget. About $157,000 in current year expenditures will help reduce the surplus.

Tuesday’s meeting was the first draft of a budget to be finalized in June. Much of the deficit is attributable to less state foundation funding, based on the decreased enrollment.

The budget is built on a base student allocation increase to $5,983, a slight increase from last year, proposed by Alaska Gov. Bill Walker, and a zeroing out of “hold harmless” funds for a reduction of $118,000.

“Hold harmless” was state money that buffered previous enrollment losses, intended to help districts transition to smaller budgets.

The budget includes $105,000 in districtwide salary increases, a borough contribution to the general fund of $1.56 million (identical to last year’s) and an estimated 9 percent increase in health insurance costs.

The salary increases include an additional $43,000 in compensation for the superintendent position, including $11,000 more in wages, $32,000 in benefits and retirement, and $10,000 in moving expenses for new superintendent Anthony Habra. Carlson, who is retired, was ineligible to receive retirement or benefits.

Carlson said he was “anticipating and hoping and praying” the borough would match its contribution from last year. The amount, he said, “is one of the reasons you have one of the best school districts in the state.”

Carlson said next year’s insurance cost hasn’t yet been received, but an increase could be anywhere between 2 and 22 percent. He stressed that the budget would change in the coming months. “This is a moving target. Tomorrow we could have a resignation, and things would change. We’re going to have to go back and juggle this (but) it’s a good, working document.”

As interim superintendent, Carlson said it’s not his place to make “radical” staffing or budget changes. He said his job was to stabilize the district. “You need to look next year at staffing and programs and expenditures.”

The district anticipates enrollment next year to be 260 students. The district currently has 277 enrolled.