School board continues preliminary budget discussions

Published 1:30 am Monday, March 30, 2026

The Kenai Peninsula Borough School District continues grappling with budget reductions in the face of an $8.6 million deficit. Members of the Board of Education made further adjustments to preliminary budget scenarios during a Finance Committee meeting on March 23. The full board will next meet in Homer on Monday, April 6.

The district has been working through three budget scenarios for fiscal year 2027 over the past few months, each of which currently assumes approximately $71.8 million in state foundation funding, barring an additional increase to the base student allocation by the state Legislature, and varying levels of funding from the Kenai Peninsula Borough. Scenario one, what district superintendent Clayton Holland has called “the worst case scenario,” assumes the level of funding currently proposed by the borough — $59 million — and includes elimination of or reductions to several staffing positions and across-the-board increases to the pupil-teacher ratio.

“I want this to be clear — this is a preliminary budget,” board president Jason Tauriainen said during last week’s finance committee meeting. “We’re going to pass something that’s balanced to send to the borough, and … I think everybody here can agree, scenario one is not a good scenario. The reality of our budget is going to help us ask and advocate.”

Scenario two builds off of the district receiving the same level of borough funding as FY26, $62.3 million, and scenario three assumes the maximum allowable funding from the borough this year at $68.6 million. Any PTR increases were already eliminated from both scenarios two and three, but other sizable cuts remained, including the end of district support of school pools. All three budget scenarios now also call for the closures of River City Academy, Seward Middle School and Sterling and Tustumena Elementary schools ahead of the 2026-2027 academic year.

Holland wrote in an email to Homer News on Monday that while the district is advocating for the maximum amount of funding allowable in order to reverse many of the reductions being made for FY27, the budget that the district has to move forward with at the next meeting is “based off of what we currently know, which is scenario one.”

“Ultimately, the borough is going to determine their budget. The state is going to determine their budget. Everything is going to continue to be in flux and change throughout the coming months. So this is a working document, and the things that we are looking at and making recommendations on today are just recommendations,” Finance Committee chair Sarah Douthit said during the March 23 meeting. “There’s things that can change, and these documents are going to go to the full board in April for their comments and thoughts as well.”

Changes from the last iteration of the budget scenarios worksheet created during the March 3 finance work session include both the removal of some items previously being considered for elimination and the addition of new reductions. Last week the finance committee removed the complete elimination of certified librarians and library aides from scenario two, opting instead to only eliminate library aide positions in schools that already have a librarian under that scenario.

“I think that keeping the librarians, but reducing the aides in libraries where there is a librarian, is a decent compromise to some reduction in our library staff while still trying to maintain as much staffing for our students as we can,” Douthit said.

The committee also added a reduction by 1 FTE to theater techs and managers and a reduction by 50% to the district’s tech plan. Both scenarios two and three also include new expenditure adjustments for charter schools, which Douthit explained is the money the district would owe the charter schools if the borough did approve additional funding.

The latest budget worksheet also reflects revenue and expenditure adjustments related to the new Nikolaevsk Charter School, with amounts currently equalling $915,950 and nearly $1.1 million, respectively.

The total excess of revenue over expenditures for each of the three scenarios also saw a shift from the March 3 work session. Scenario one’s excess revenue saw a slight increase from almost $527,000 to over $533,000. Scenario two’s excess decreased from over $2 million to less than $1 million, while scenario three’s excess increased from $1.7 million to $2.1 million.

Finance committee member Mica VanBuskirk, who represents Seward on the Board of Education, supported using even more of scenario two’s excess to cover additional FY27 expenditures, to the point of leaving less than $10,000 as a contingency margin for the next fiscal year.

“I believe we have accounted for some contingencies in here … and there’s a lot still up for debate in terms of what the total revenue is going to be, and I would like to move forward with significantly less excess money and preserve these positions that are critical to our schools and our communities,” she said.

District administration and other board members pushed back against depleting the contingency margin so severely.

“Going to zero I think would be a mistake,” board president Jason Tauriainen said. “We need to have some buffer down there.”

Finance director Czarina Voivedich said that the district needed to keep in mind the recent fuel price increases for student transportation costs.

“Fuel prices are ridiculously high, and we have to account for (the) fuel differential that we pay to First Student,” she said. “We cover that cost, and we only transferred $200,000 to our pupil funding, so we have to think about that for the next fiscal year as well.”

Holland clarified during the meeting that the district pays fuel costs that exceed $2.50 per gallon, according to their transportation contract.

“With $5 a gallon that we’re looking at right now, we’re estimating about $35,000 per month more in fuel transportation costs, so we have to account for that at this time,” he said.

Voivedich added that while the current budget scenarios include funding and costs for Nikolaevsk Charter School, those numbers are based off of enrollment projections, not the charter school’s actual budget, which is not yet available.

“There is a risk associated with this whole thing, which is part of what our concern was way back,” Holland said. “We still do have concerns about not hitting the numbers.”

Finally, the district is still looking at adjustments to special education intensive needs student enrollment, which may be lower than originally projected.

“There is a desire to maintain a reasonable margin of revenues over expenditures, similar to the $2.3 million funding contingency included in FY26,” Holland wrote Monday. “This funding contingency would help address the items discussed at the start of the committee meeting for FY27, including fuel and pupil transportation cost increases, potential shortfalls in interest revenue, SPED (intensive) count variances, and costs associated with negotiations.”

The preliminary budget will come back to the Board of Education for further discussion during a work session on Monday, prior to the regular meeting.

“This will be the document that we will present to the full board on April 6 for discussion, and in the meantime, administration will continue to work on this and make sure that we’ve got everything in line where it needs to be,” Douthit said.

Board president Jason Tauriainen said that, as of last week’s finance committee meeting, the plan for Monday’s meeting in Homer is to discuss and potentially vote on the school closures described in the budget reduction scenarios before holding a vote on the budget itself.

“If it looks like we need to work on the budget some more, then we will table it to a later date in April,” he said, noting that the budget must be transmitted in May.

Holland also confirmed Monday that district administration will give a presentation to the borough assembly at their next meeting on Tuesday, April 7, on the district budget and funding process “as a way to start the discussion and create a mutual understanding.”

“We’ll have ongoing meetings with the mayor’s office, ongoing meetings with the assembly, and this is the time for us to act, to give that message of where we are, to try to move forward,” Tauriainen said. “We’ve got work to do, but our first step is to get this budget through, and then we can let them know where we’re at and try to fight for what we need and what’s best for kids.”

The laydown FY27 budget reduction scenarios from the March 23 meeting, as well as the KPBSD Board of Education Finance Committee meeting recording, are available in full on the KPBSD BoardDocs website.