School board to consider Mat-Su Central shake-up as district faces $22 million funding shortfall

What you need to know: 

• The Mat-Su Borough School Board is considering a plan to divide the Mat-Su Central correspondence school into two distinct programs: a hybrid brick-and-mortar model with part-time in-person class requirements and a correspondence track with lower graduation standards. The move is aimed at attracting more students statewide and addressing a projected $22 million funding shortfall for next year.
• The funding gap is attributed to rising costs, stagnant state funding, and the expiration of $17 million in federal COVID-19 aid, officials said. The shortfall is based on current operation levels, and district officials plan to propose budget cuts.
• Both programs would operate out of the school’s newly constructed $24 million facility in Palmer. The proposal requires approval from both the school board and state education officials.

PALMER - The Matanuska-Susitna Borough School Board will consider major changes to the district's home-school correspondence school in an effort to attract more students from across Alaska and chip away at a $22 million funding gap predicted for next school year.

If approved, the plan would split the Mat-Su Central program into two distinct programs: a hybrid brick-and-mortar program that would maintain the district's current high school graduation standards while introducing a new part-time in-person class requirement, and a correspondence program with optional in-person classes similar to the school's current structure but newly paired with lower high school graduation standards.

Students enrolled in the new hybrid program would no longer receive the state homeschool allotment, district officials said. That allotment is currently set at up to $3,000 for Mat-Su Central students, depending on grade. Those registered with the correspondence program would continue to receive the allotment and could cross-enroll in the hybrid program to access classes, officials said.

District officials said the allotment rate for current students could go up as part of the reformatted program. Specific details on a payment increase were not immediately available.

Mat-Su School District Superintendent Randy Trani presented the proposal during a school board meeting Wednesday. He said the reformatted programs could start as early as August and bring in an estimated $3.3 million in additional state and local funding in the first year.

District officials estimate a funding shortfall of $22 million next year if operations are kept at current levels. The gap is tied to rising costs, stagnant state funding and the expiration of $17 million in annual federal COVID-19 aid. The preliminary 2026 budget to maintain current services is about $287.9 million.

Funds generated by the revamped Mat-Su Central program would help cover a small portion of that. Proposed budget cuts will be announced this spring, Trani said.

A similar funding gap in the current school year was covered by cash from the district's fund balance savings account and some reductions in staffing and administrative costs, officials said. Relying on the fund balance again next year is not a viable option because it would leave less than $5 million in reserve and put the district at financial risk, officials said Wednesday.

About 2,800 students are currently enrolled in Mat-Su Central, including 500 who take in-person classes, officials said. Class costs vary and are covered by allotment funds received by enrolled families.

Mat-Su Central is the largest school in the district. A new 45,000-square-foot, $24 million facility funded by the borough is under construction near Palmer and is expected to be completed this year. The proposed revamped programs would operate out of that building, officials said.

State and local school funding in Alaska is based on factors such as enrollment and school type. Schools designated as "alternative" receive about $12,000 per student, the highest level of funding, according to district data. Correspondence schools receive about $7,000 per student, a portion of which is passed on to families to cover education-related expenses.

Splitting Mat-Su Central into two programs could help reduce the budget deficit because it would reclassify the new brick-and-mortar hybrid school program and its 500 part-time in-person students into the higher state "alternative" funding category, Trani said.

“Think about the 500 kids who regularly attend classes at Mat-Su Central,” Trani said at the meeting. “If they're regularly attending, why are we not getting the money for their regular attendance in a brick-and-mortar environment?”

School officials envision the hybrid program also offering flexible class schedules, with evening and weekend options that make it easier for students to take them, they said. The classes could also be open to all district students, a move that could appeal to secondary students who want to take alternative courses not offered at their enrolled school, they said.

The reformatted correspondence program could also bring in additional funding over time by attracting students from other statewide programs, such as Raven and IDEA Homeschool, Trani said. About 3,000 Mat-Su students are enrolled in correspondence programs outside the district, he said.

School board members expressed support for the plan Wednesday. District officials said a version of the proposal will be presented for the board's consideration at an upcoming meeting. The plan also must be approved by Alaska Education Commissioner Deena Bishop because it involves adding a new brick-and-mortar school to the state.

How the changes would affect families currently enrolled in Mat-Su Central depends on how they use the program and whether students want to graduate with a district diploma, officials said.

Currently, students who graduate from Mat-Su Central must meet the district's 25.5-credit requirement, which is 4.5 credits above the state minimum and requires one career and technical education class and at least one Advanced Placement class taught by a certified teacher.

Those higher requirements do not appeal to all homeschool families, causing many to drop out or change programs, Trani said. While Mat-Su Central has the highest enrollment of any school in the district, it also has the lowest graduation rate at 73%, officials said.

The proposed program split would allow enrolled students to choose between the district's 25.5 credit diploma track or the state's 21 credit minimum.

“The state has built an easy path around our requirements, and literally, by the 1,000s, students are going around our increased requirements,” he said. “If you go for the state minimum, you're getting the state minimum, which is exactly what some people want, because they do other enriching ideas in their correspondence environment. That's the point of it.” 

Specific details about how the proposed programs would be administered are still being developed, officials said, including staffing, possible cost changes for face-to-face classes and class schedules.

-- Contact Amy Bushatz at contact@matsusentinel.com

This story was updated Jan. 17 to reflect the status of the student allotment under the hybrid program and to note that Mat-Su Central is the largest school in the district.