The Ketchikan Gateway Borough has one more year before its education fund dips so low that it can either cut spending or raise taxes. The borough assembly tossed around several ideas but have yet to land on a solution.
Ketchikan has a looming problem. Borough Finance Director Cynna Gubatayao said Monday evening that its education fund reserves have been tapped over the past several years. To fund next year’s school district budget at the current level, it would fall below the $2 million savings requirement.
Gubatayao says the assembly has four options: to give around $375,000 less to schools next year, raise property or other taxes, cut local spending elsewhere or muster a five-vote supermajority to keep pulling from reserves.
“But it will only buy another year or so. At some point you’re faced with the wall and you have to take action. We won’t have the reserves to spend from anymore.”
Schools in Ketchikan are funded by the state and federal Secure Rural Schools program, plus property taxes and a local tax on tobacco.
Assembly member Judith McQuerry suggested eliminating some senior sales tax exemptions.
“Several years ago we considered doing away with the senior tax exemption for alcohol, tobacco and marijuana. And personally, I don’t think it’s going to fill the whole gap, but I think it’s something that we ought to look at again.”
Another idea floated was increasing the tobacco tax by $1 per pack for all.
Assembly member Felix Wong says revenue from tobacco sales has been declining and would not support a large tax increase in that area.
“I’d like to keep it that way just so that it’s not so obvious that we’re squeezing one group of the population more than the others.”
Assembly member Jeremy Bynum says he would like the school board and community at large to be more involved.
“I don’t think it would be helpful to us to try to come up with a decision on how we’re going to move forward without that public interaction and comment. We need some real input here.”
No recommendations were made Monday night. At its next meeting March 15th, the borough assembly will discuss scheduling another education funding work session in April. The deadline for the school board to submit its budget request to the assembly is May 1st. The assembly has 30 days after the time of receipt to respond.
In other business, the assembly has approved accepting a $450,000 windfall it had received from a combination of state support and grants for education funding for this year.