Juneau School District leaders are gearing up for major budget decisions over the next two years as enrollment declines and major funding sources expire.
At a public budget forum Thursday, Administrative Services Director Cassee Olin said the district is facing a $4.7 million deficit next fiscal year.
The $30 increase to the base student allocation increases state funding to the district by $243,000, according to Superintendent Bridget Weiss. But it’s not enough to keep the district out of a deficit as costs go up and enrollment goes down.
The district still hasn’t felt the full financial impact of an 11% enrollment drop from 2020. That’s because of the state’s hold harmless provision, which helps districts who’ve lost students by gradually reducing the amount of state funding they receive over the course of three years instead of immediately.
That provision gave the district an extra $2.1 million in state funding this year, according to Olin. Next year, that money goes away.
Elementary, middle and high school principals shared their budget priorities with district leaders at Thursday’s forum. They included avoiding increases to class sizes and retaining reading specialists and counselors.
The district will be in a similar position next year, when one-time COVID relief from the federal Elementary and Secondary School Emergency Relief (ESSER) Fund runs out. Weiss said the district has an estimated $1.6 million in ESSER funds to spend next school year.
“So there’s another consideration as we look down the road to FY25 and how we’re going to manage that stair step away from ESSER, like we’re having to manage this year the stair step away from hold harmless,” she said.
District and city leaders began discussing longer term financial plans for the district at a meeting Friday. Enrollment projections show the district will likely have 1,100 fewer students in 2023 than it does now.
“It’s unsettling, and it’s not the demographic trend that any of us wish, but I think the data supports it,” City Manager Rorie Watt said.
“Changes in the projections are really only going to come from us believing that people are moving into Juneau and moving into the region and our population’s going to grow, and I don’t think anybody’s really predicting that to any significant degree,” Watt said.
Weiss said a proposed $1,000 increase to the base student allocation offered “a glimmer of hope” for future years.
In the meantime, the Juneau school board must come up with a balanced budget by March. It will go before the Juneau Assembly for final approval in May.