Anchorage School District board considers projecting state funds to avert layoffs, warns of long-term deficit

The Anchorage School District Board of Education on May 6 discussed a plan to project a conservative $560-per-student increase in the state base student allocation, a move administrators say would let the district reabsorb many displaced staff and avoid immediate layoffs but would still leave large multi-year deficits if the legislature or governor reduces the final funding.

Superintendent Miss Sullivan opened the budget discussion, citing recent legislative movement on House Bill 57 and saying the bill “passed with 48 of 60 votes,” and that the board could choose to take a “calculated level of risk” by assuming some level of increased revenue now so staff can be placed before year end.

The district’s chief financial officer, Andy Ratliff, told the board the finance committee recommended using a conservative $560 BSA assumption (below the $700 figure in some proposals) to amend earlier staffing cuts. “There was a little under $40,000,000 that was added back based on a $560 BSA increase,” Ratliff said. He said that about $30 million to $31 million of that would go directly into classrooms and about $9.7 million into instructional support, including librarians, nurses, counselors and other positions the board prioritized restoring.

Administrators described what passage of the board memo under discussion (referred to in the meeting as “memo 153”) would allow the district to do if the board approved it that night: avoid layoffs of certificated staff, begin reabsorbing displaced employees into positions at their schools, and start an accelerated hiring process for any remaining openings so schools can recruit while candidate pools remain available. Administration said principals would be briefed the day after the meeting and that staff notifications to affected employees would begin on Thursday of that week.

Board members pressed for specifics and cautioned about long-term impacts. Amber Jacobs, a board member, asked whether the $700 BSA proposal would be sufficient to meet statutory class-size goals and said the district cannot meet the legislature’s class-size targets with the funding being discussed. “I think the other thing it highlights is … our system right now is fundamentally broken,” Jacobs said, arguing that the state and district will need to continue the funding conversation beyond the current session.

Administrators identified several concrete risks if the legislature or governor reduced the expected increase: hiring freezes, cuts to discretionary funds and liquidation of assigned fund balances to avoid a negative fund balance. Ratliff said the district would consider which assigned fund balances to liquidate in accordance with Governmental Accounting Standards Board rules and noted those reserves include self-insurance and other encumbrances.

Staff and board members provided additional fiscal details: the Municipality of Anchorage had been expected to contribute roughly $12 million–$13 million for transportation; replacing a certificated educator has been estimated at a little over $29,000 per hire; the district added roughly $40 million back into the current-year plan under the $560 assumption but still had previously cut about $23 million that remain removed in this proposal; and administrators projected a roughly $70 million–$80 million ongoing deficit for fiscal year 2027 under the current assumptions.

Administrators also reported on staffing scale: the district had notified more than 200 employees of displacement earlier in the staffing season; with the projected revenue assumption that figure would fall to an estimated 25–30 displaced employees. Staff described displacement as a complex process that includes preference sheets, transfer rules and an accelerated placement effort to find openings that match displaced educators’ preferences.

Board members and administrators repeatedly emphasized uncertainty. Several noted that final funding could change in negotiations, the governor could line-item veto parts of a bill, and other districts in the state are using different BSA projections. “We’re intentionally projecting less than that,” Ratliff said of the $700 figure, referring to the board’s conservative $560 assumption.

No formal vote on memo 153 is recorded in the transcript excerpt. After the budget discussion, the board moved without objection to recess into executive session for uncontested student hearings, legal updates, negotiations and contracts.

The board scheduled further briefings: administrators said they would return with emergency-preparedness briefing at the next work session and would continue budget and staffing work pending legislative outcomes.