Daily Sitka Sentinel

Assembly Holds Off on Forward Funding

    The Assembly held off on a decision Tuesday to forward fund the Sitka School District, saying the city has to make sure it can balance its own budget and meet city needs, before drawing on savings.
    “Balance your budget the best you can,” Mayor Cheryl Westover said. “I don’t want to forward fund anyone.”
    “Forward funding” is the concept of committing city money to a budget in anticipation of future funding from state or federal sources, with the commitment covered by city reserves if the outside money doesn’t come through.
    Pete Esquiro agreed with Westover, saying he would prefer to see the school district draw down its own reserves before asking for a guarantee from the city. Last year the city provided forward funding from anticipated receipts from the federal Secure Rural Schools program.
    “I’m not going to be supportive of utilizing our reserves,” Esquiro said. He encouraged the school district to cut expenses other than personnel, such as the technology budget that is increasing every year.
    The Assembly members voted 6-0 to take up the issue again no later than the second meeting in March, when they hope to have better information about additional funding from state and federal sources.
    Thor Christianson was removed from the discussion of school funding issue after his participation was challenged by Westover. She said previous comments by Christianson about the large number of pupils in his wife’s elementary school classroom revealed an “extreme bias.”
     “I feel all of our citizens deserve an unbiased discussion on this,” she said.
     Christianson said he didn’t think that making an observation about the size of a class was showing bias. “I was a volunteer,” he said. “I think every Assembly member should do that.” He said he has made no secret that he supports schools, and other Assembly members have made similar statements.
    “I really think that this is motivated by my support for the school district,” Christianson said.
    Westover invited her colleagues at the table to overrule her, but only Mim McConnell and Phyllis Hackett indicated any objection to Westover’s ruling. Christianson left the meeting and didn’t return.
    The Sitka School District asks for forward funding from the city because schools often don’t receive final word on state funding until after it completes its budget. The school district would like to avoid sending out pink slips unnecessarily, and making difficult cuts that may turn out not to be needed when state and federal funding ultimately comes in.
    Sitka School Board President Lon Garrison said in a letter that even with state support he anticipates cutting $100,000 to $200,000 or more from the district budget. Last year, the board made similar cuts by eliminating positions through attrition and laying off one employee.
    School district business manager Dave Arp attended the Assembly meeting, but no School Board members were present because they were holding their own meeting at the ANB Hall. (See related story.)
    The Tuesday Assembly meeting was a carryover from last week’s regular meeting which had a number of time-consuming issues on the agenda and adjourned at 11 p.m. with a few items left on the table.
    McConnell, Hackett and Mike Reif spoke in favor of forward funding the school budget.
    Reif favored setting that amount at $300,000, which is just under the amount that Senate Bill 171 would bring in. If it wins final approval in the Legislature SB 171 would increase per pupil funding by $125 and provide $340,000 more in funding for Sitka schools.
    “If it comes through, they’ll pay us back,” said Reif. “If it doesn’t, that’s money we help them out with.” He said the school district would still have to make “serious cuts but not drastic cuts.” The city and school district are not counting on funding coming through from Secure Rural Schools, which provided over $1 million to Sitka last year.
    Hackett agreed with Reif that forward funding in that amount was a good bet.
    “We’re betting on whether the state will come through,” Hackett said. “ I tend to think the state will come through. ... I’m willing to bet the state is going to come through and do the right thing.”
    But after Hackett, Reif and McConnell saw they lacked the fourth vote for forward funding at the Tuesday meeting, they asked to take up the discussion no later than the second meeting in March, when Assembly members may have a better idea of the city budget, and a better indication of the possibility for federal and state funding. Blake, Westover and Esquiro agreed.
    The main sticking point in forward funding schools was the concern about the city’s funding picture, and impending capital projects that will have to come out of city coffers if requested funding from the state doesn’t come through.
    “We have to look at our budget,” Westover said. She mentioned the hospital roof and an additional diesel generator as two big-ticket items that will need to be covered by the city, if state funding is denied. The Assembly has also expressed the desire to establish a sinking fund to maintain its infrastructure.
    “We both need to tighten our belts,” Westover said.
    The Assembly expressed sympathy for the school district’s budget problems, but noted that the city had challenges as well and needed to move cautiously.
    Terry Blake said he would prefer to make this decision after seeing both city and school district budgets.
    The vote was 6-0 to take up the issue no later than the March 27 meeting.
    The Assembly had a chicken-and-egg discussion about cuts in the city budget and the ordinances in the works for raising revenues.
    The city is in the process of finalizing its budget, and trying to close the gap between revenues and expenditures. The Assembly has passed on introduction two ordinances to increase the sales tax cap to $1,500, and to put income requirements on the senior sales tax exemption.
    The sources combined are expected to increase revenues by $800,000 to the city next year.
    But Reif said he wouldn’t vote for either of the tax changes until he had seen proposed cuts in the city budget. Hackett agreed.
    City Administrator Jim Dinley asked to be allowed to do his job, and present a complete and balanced budget in a timely fashion. He said he wasn’t ready to present the Assembly with information requested by Reif – a list of cuts in the budget this year – because his work is not yet completed.
    “I will give you a balanced budget. There will be cuts in there,” Dinley said.
    He and Finance Director Jay Sweeney said budget information is still coming in, including a notice recently that health insurance costs are down 3 percent.
    Sweeney said once the budget is completed and presented to the Assembly, members will have adequate public meetings and work sessions to review the budget and make changes as desired. The Assembly agreed to hold off on its request for a list of cuts until budget review time.
    Dinley said the Assembly would be better off waiting, and urged patience.
    “We’re working it,” Dinley said. “Hopefully it’ll be the best I’ve shown you in five years. ... I have a passion to get it right.”