The Ketchikan Gateway Borough Assembly will kick off its annual marathon strategic planning session bright and early Friday morning.

The Borough Assembly’s two-day meeting will cover a variety of topics, but they all pretty much boil down to the same thing: Money.

Appropriately, then, it starts with a work session dedicated to establishing guidelines for the Fiscal Year 2016 budget.

One assumption for that budget is that the state’s budget woes – brought on by low oil prices – will hit local governments, as well. Borough Manager Dan Bockhorst noted that over the past six months, oil prices have dropped more than 50 percent. And even before the price collapse, the state was projecting a deficit.

“So, Alaska as a whole is certainly facing fiscal challenges, but I strongly believe that the Ketchikan Gateway Borough and our community are reasonably well positioned to weather the anticipated impacts,” he said.

While the state’s fiscal problems could affect Ketchikan through decreased revenue sharing, education funding and school debt reimbursement, Bockhorst said the borough is ready – at least in the short term.

“For example, last year, the Assembly and mayor created a schools reserve fund,” he said. “We put over a million dollars into that fund to help weather downturns in funding.”

The Assembly also put another million away for school debt payments and kept its own debt low, Bockhorst said, adding that fund balances are reasonably healthy.

“Certainly, another important development is the borough’s victory in the education funding lawsuit,” he said. “I think that’s going to prove very critical in terms of the long-term fiscal health of the borough.”

After years of lobbying the state to change its education funding policies, the borough last January filed a lawsuit challenging the constitutionality of the required local contribution – a minimum amount that municipalities must provide to their public schools. Unorganized parts of the state aren’t held to that requirement.

Superior Court Judge William Carey ruled partly in the borough’s favor, agreeing that the local contribution violates the Alaska Constitution. Carey declined to award the borough a refund of last year’s local contribution, however. The borough has asked for reconsideration of that decision, and a ruling on that request is pending.

There have been rumblings on the state level of potential cuts to education funding. Bockhorst said that before the borough’s court victory, there also was talk of shifting more of the education burden to municipalities.

“So, as a result of the victory on the part of the borough, it’s reasonable to say that how the state responds to this latest fiscal problem that it’s facing, it’s going to respond to it in a fashion that’s much more aligned with the state Constitution,” he said.

Whatever Judge Carey’s final decision might be, an appeal is expected, which means the final outcome of the lawsuit won’t be known for a while. In the meantime, Bockhorst said the borough will budget a local education contribution as it would normally.

During the planning meeting, the Assembly also will talk about library funding, which was a controversial topic in 2014. The Assembly briefly cut the borough’s financial support of the city-operated library last year, but then reversed that decision following public outcry. The borough provides about $400,000 for library services, collected through a nonareawide fee.

What to do with the Animal Protection Department is another discussion topic. The borough last year hired a consultant to assess the department, and provide recommendations and options. Policy issues that will come before the Assembly include whether to try contracting out animal protection services, whether to move the animal shelter to a new building, and how long a remodel of the current shelter should be delayed while the borough considers its options.

The strategic planning session starts at 9 a.m. Friday and Saturday in Borough Assembly chambers at the White Cliff building. Saturday’s session will be dedicated to education issues, and will include members of the Ketchikan School Board. Public comment will be heard at the start of the planning meeting. However, because of the length of the meeting, those offering comments will be limited to three minutes.