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School-district staff say cash reconciliations, not just health claims, are blocking clear cash-flow forecasts
Summary
District business staff told the liaison committee the school district has not reconciled cash to the borough for years, complicating FY2026 cash-flow projections; staff cited health-claims accounting and unfilled payroll obligations as drivers and proposed sub-fund balances and system-integrated reports to improve transparency.
Miss Pierce told the Ketchikan Gateway Borough Assembly–School Board Liaison Committee that the district has not reconciled its cash to the borough "for years," making it difficult to produce accurate cash‑flow projections.
"I personally have a hard time giving a cash flow projection when I don't even know what I'm starting with," Pierce said, and told members that the district is relying on the borough's numbers while staff work to reconcile underlying accounts. She identified health-claims accounting as a key reconciliation challenge but said operational and staffing costs also appear to be significant drivers.
When asked whether the district's roughly $5,400,000 shortfall was mainly health-care related, Mr. Dowell asked Pierce to estimate the composition. "I don't believe it's operations, primarily staffing," Pierce replied, adding later, "I believe you're drastically overstaffed," as one explanation for ongoing deficits.
Pierce described steps staff plan to take to improve transparency and accounting accuracy: setting up sub-fund balance accounts to separate KCS and TSAS balances, creating reports that can be exported directly from district accounting systems instead of relying on manually populated external forms, and working with borough staff to produce a reliable starting balance. She estimated the sub‑fund setup could be in place by July 1.
Committee members discussed the Assembly's "green form," a longer reporting document last updated May 2025, and suggested reworking it so it contains the most useful fields — student counts, special-education intensity, number of employees and per‑employee health costs — and can be fed automatically from district systems rather than entered by hand.
Pierce also said she has not yet completed June cash‑out projections and is basing short-term planning on available borough worksheets for a three-year repayment plan. She told the committee that DEED had requested an assigned MOA and a repayment structure showing how the district will address the negative fund balance.
Members urged continued candor and rapid development of usable reports. "The more we can talk about all of these pieces so that somebody can get a big, 30,000-foot view," one member said, "is very beneficial to our community." The committee set a follow-up liaison meeting for April 7 to continue budget discussions.
