A year after wrangling with a projected $15.1 million budget gap, the St. Paul School District now is eyeing a potential $27.3 million shortfall for 2017-18.

The projection, outlined during a school board meeting Tuesday, arrives early in a monthslong budgeting process. In Minneapolis Public Schools, Superintendent Ed Graff announced two weeks ago that the district is looking at a $28 million budget gap for the upcoming school year.

Shortfalls could be eased by per-pupil funding increases discussed at the state level.

Gov. Mark Dayton has proposed a 2 percent per-pupil formula increase that could provide $6.4 million in state aid to St. Paul schools.

Also in play are district efforts to persuade the St. Paul Federation of Teachers to buy into Q Comp, the alternative teacher pay plan that officials have said could draw up to $9 million a year in state and local funding for professional development and other purposes.

Q Comp, when created under former Gov. Tim Pawlenty, sought to link teacher pay to student performance. But that aspect of the plan has been downplayed by Dayton's administration and by districts, including Minneapolis, which in 2013 negotiated a deal with its teachers union calling for performance pay of just $3 per year.

In a proposal to its teachers a year ago, the St. Paul school board noted that Q Comp could, instead, be used to pay for teacher mentoring and peer review — expenses now covered by the district. State Sen. Sandy Pappas, DFL-St. Paul, also tried at that time to get union buy-in. But the federation told Pappas that the district should try to fix its budget woes in other ways, and it expressed frustration that previous boards hadn't given serious consideration to putting a new property tax levy proposal before voters.

On Tuesday, John Thein, the district's interim superintendent, said he planned to meet with union President Denise Rodriguez this week and that Q Comp would be discussed. He added that the union has six conditions it says must be met to give its support of the pay plan.

St. Paul's $27.3 million shortfall stems largely from $23.3 million in inflationary costs if the district were to roll over its 2016-17 budget "as is." In addition is a $4 million revenue decrease caused in part by declining enrollment.

Budget-balancing measures up for consideration include the possibility of letting some vacant positions go unfilled plus an offering of early retirement incentives — the latter of which were proposed and withdrawn a year ago. No decision has been made, Marie Schrul, the district's chief financial officer, said Tuesday.

The school board has until the end of June to approve a 2017-18 budget.

In Minneapolis, Graff laid out a plan to fix the budget gap, which includes a 10 percent cutback to Central Services and a 2.5 percent reduction to school allocations, plus a "one-time" use of reserves. But he said in a letter to the school board that he aims for a "structurally balanced budget" by 2019-20.

By contrast, Anoka-Hennepin, the state's largest school district, is projecting a surplus, thanks to a spike in enrollment.

Staff writers Beena Raghavendran and Beatrice Dupuy contributed to this report.

Anthony Lonetree • 612-673-4109