Mat-Su school district plans teacher, program cuts amid state funding uncertainty

What you need to know:

• A Mat-Su Borough School District budget proposal includes teacher reductions, program changes and fewer school bus routes, officials said. The cuts are designed to make up for an expected $12 million funding shortfall.
• The budget is based on estimated state education funding levels and could change after lawmakers make a final decision.
• A second district budget review with more details will be presented to the school board on March 18. The final budget is set to be adopted in June.

PALMER – A Mat-Su school district budget proposal reduces overall teacher and support staffing, shrinking programs, lowering service contracts and eliminating some bus routes as district officials work to make up for an expected $12 million funding shortfall.

The plan is part of a best-guess school budget process based on uncertain education state funding for next year, district officials said. How that process ultimately plays out could have a dramatic impact on the final spending plan, they said.

“The one thing I can guarantee about this is that it’s wrong,” Superintendent Randi Trani said during the meeting. “None of us know what the funding level will be.”

Matanuska-Susitna Borough School District officials presented their first look at the 2025-2026 school year budget to the school board at a meeting on Wednesday.

The proposed $281.3 million budget calls for reducing the district's overall staff by about 3.5%, or 75 positions, including teachers and support staff. While most of that decrease is expected to occur through natural attrition, such as retirements or teachers leaving the district, some layoffs might be necessary depending on the final funding numbers, officials said.

The proposed staff cuts would increase student-teacher ratios in many classes, officials said. The cuts include 42 classroom teachers, 31 instructional support positions, and two administrators across the district's 48 schools, according to budget documents.

Some schools have already started making internal announcements about their anticipated cuts as part of their regular planning process for next school year, district officials said in an interview.

Mat-Su is the second-largest school district in the state, with about 19,000 students and 2,100 employees, according to district data. Its budget for the 2024-25 school year is $278.1 million.

The $281.3 million proposal for 2025-26 is higher than current-year spending despite across-the-board cuts because of inflation and increased employee health and liability insurance rates, according to district budget documents.

In addition to staff reductions, the proposed plan would also cut districtwide nonpersonnel spending by 15% and school-specific nonpersonnel spending by 10%, according to the documents.

Homeschool student allotment payments account for the largest portion of the district's school-specific nonpersonnel budget, district officials told the school board during the meeting.

Officials did not identify which programs will face cuts.

Contracts for districtwide services, such as internal management systems and snowplowing, would also be reduced by 14%, officials said.

The district will also eliminate some bus routes under the plan. Specific information on how many routes will be affected was not immediately available.

A second budget presentation with more details on the proposed cuts is scheduled for later this month.

The majority of school district funding in Alaska comes from the state and is calculated on a per-pupil basis, known as the Base Student Allocation. Depending on the year, districts may also receive one-time funding increases or grants for specific needs, such as transportation.

But in recent years state funding has not kept pace with rising district costs, officials said. And with levels for the coming year still uncertain, the district must create a budget based only on estimates, officials said.

“Unfortunately, we don’t have the luxury of waiting until information is confirmed,” said Katie Gardner, a deputy superintendent who oversees the district’s business and operations.

Trani said he expects the state to increase funding over last year and that estimate is incorporated into the current proposal.

“I just have trouble believing that it’s going to be less than what we currently have,” he said.

The district can also update the budget once final state funding is announced, he said.

District officials will present a second budget review for initial school board approval at a meeting scheduled for March 18. That plan will be incorporated into the Mat-Su Borough's 2026 budget process this spring and presented to the school board for final adoption in June, according to district budget documents.

This story was updated on March 6 to further clarify that district officials did not identify which programs will face cuts.

-- Contact Amy Bushatz at contact@matsusentinel.com