Assembly must decide who gets funds: schools or nonprofits

State cuts limit city, education, arts and services

Posted: Tuesday, July 08, 2003

At tonight's Finance Committee meeting, Juneau Assembly members will grapple with how to answer funding requests from the Juneau School District and area nonprofit groups. The requests total more than the city has to give.

City debates how to spend extra funds

Funding requests:

• Perseverance Theatre: $50,000.

• Juneau Economic Development Council: $105,000.

• Juneau Jazz and Classics: $12,000.

• Juneau's Washington D.C. lobbyist contract amount increase: $10,000.

• Social Service Advisory Board grants to SAGA, JAMHI, Gastineau Human Services and Alaska Legal Services: $132,700.

• School District funding above last year's allocation: $292,000.

Total requests: $601,000.

"I wish I had a solution, but I think we are just going to have to downsize," said City Manager Rod Swope, adding that tough financial conversations, like the one he anticipates tonight, will continue for the next few years.

The Finance Committee meeting is scheduled for 5 p.m. today in Assembly chambers.

The city landed in budgetary straits last month when Gov. Frank Murkowski cut $1 million in municipal assistance to Juneau, citing declining state revenues and the need to balance the state budget. The school district also was hit with cuts at the state level, causing it to seek about $300,000 in additional support from the city above last year's funding. City officials must also consider approximately $300,000 in requests from nonprofit groups such as Perseverance Theatre and the Juneau Economic Development Council.

"This governor does not support education or local government as past administrations have, and we have to be as self-sufficient as we can," said Jim Powell, Assembly Finance Committee chairman. "I am very concerned about the next two years and the sustainability of our economy in light of state cutbacks."

City Manager Rod Swope proposed a plan to the Assembly to balance the budget and attempt to "spread the pain" among nonprofits, the city and the school district.

Swope said the city will receive about $560,000 in one-time assistance from the federal government with funds Murkowski allocated to offset the cut in municipal assistance. He also said the city has $535,000 in reserve funds, as well as $97,000 in other revenue to help manage this year's deficit. Swope also suggested about $288,000 worth of cuts to city government, including the elimination of 2.5 city staff positions. His plan would use the revenue to fill the hole created by the governor's cuts and give the Assembly about $515,000 to spend on various budget requests.

Swope recommended funding the largest of those requests - $305,900 for the school district. During the last legislative session, the Legislature changed the school foundation formula. That increased the funding cap - the amount of money the district could request from the city - by about $305,000.

Last year, before the cap increase, the city funded the district to the cap, and then gave schools about $300,000 more for pupil transportation and student activities. Originally, school administrators said that if the city were to fund to the new cap, the district would not request additional funds outside the cap. But the School Board later voted to ask for $292,000 in additional funds.

"What the state government did, they didn't increase school funding, they reconstructed school funding and increased the local participation, while decreasing the total amount (given to schools)" said School Board President Chuck Cohen. "Even if the city funds us to the new cap, we are still down budgetarily."

Swope recommended not funding the school district outside of the new increased cap.

"My reasoning through this whole balancing process is we all need to share fairly and equally in the cuts the governor has passed on to us," Swope said. "We in local government have had to take significant additional cuts, and they've (the school district) requested an extra $600,000. We've given them half of what they requested. I think that's more than fair."

Powell said he wasn't sure whether the Assembly would choose to follow Swope's suggestion, or would choose instead to fund the district outside the cap, rather than funding nonprofits.

"I don't think we can fund up to the requested amount for the nonprofits, but it would be a mistake not to fund a percentage of what they asked for," Powell said.

If the Assembly funds the district to the cap, Swope recommended using $44,500 to help replace revenue cut for public health-related nonprofits - such as Wildflower Court and Juneau Youth Services. After that, the Assembly would have $181,000 to meet requests from the other nonprofits, like Juneau Economic Development Council and Perseverance Theatre, as well as a request for a $10,000 raise for Juneau's Washington, D.C., lobbyist.

Julia O'Malley can be reached at jomalley@juneauempire.com.



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