The Alaska House passed a bill on March 12 intended to boost annual state funding for public schools by $275 million, starting with the 2025-2026 school year.
If approved by the Alaska Senate and the governor, the legislation would increase state funding for the Wrangell School District next year by about $600,000, according to Kristy Andrew, the district’s business manager.
The sizable increase in the state’s per-pupil funding formula approved by the House will face challenges winning approval from the Senate and the governor, however, as the state is facing a budget deficit of several hundred million dollars for next year.
Unless lawmakers raise taxes on oil producers — which the Senate is considering — or adopt significant other revenue measures — which are not currently under discussion — the Legislature will have to dig deeper into its non-replenishing reserves or reduce the size of this fall’s Permanent Fund dividend, or both, to balance the budget.
If the House bill makes it into law, it would cover almost 80% of the Wrangell district’s anticipated budget deficit for the 2025-2026 school year, assuming the borough funds the schools at the maximum amount allowed by state law — which Wrangell officials have indicated is not likely as the borough is facing its own revenue problems.
More than 70% of this year’s funding for the district is from the state, with less than 25% from the borough. School districts in Alaska cannot levy their own taxes and are dependent on state, federal and municipal funds.
The House spent long floor sessions across three days last week debating proposed amendments to the K-12 school formula bill before voting 24-16 to approve the measure, which will boost the formula by almost 17%. That would add $1,000 per student to the base formula of $5.960, which is adjusted for each district based on school size and to account for students with special needs and other factors.
All 21 members of the Democratic-led House majority voted for the bill, along with three members of the Republican minority, including first-term Ketchikan Rep. Jeremy Bynum, who also represents Wrangell.
The Senate Education Committee will take up the bill this week.
The funding formula has essentially been flat for seven years. Public school advocates have been pushing hard in recent years for the Legislature to boost state funding, which has failed to keep pace with rising costs or inflation.
Much of the Republican opposition to the measure last week focused on the state’s own revenue shortfall.
“It’s really important that if we’re going to stand on the floor, and we’re going to pass things, we have really got to start telling the voters and the state how we’re going to pay for it,” Fairbanks Republican Rep. Will Stapp said in a news conference after the vote.
The Legislature in 2024 approved a one-year funding increase of just over 11% when the House and Senate and governor could not agree on a permanent boost in the formula.
In addition to the funding, the House bill would require districts to adopt rules limiting cell phone use (Wrangell already has such rules) and create a legislative task force to analyze school spending and make recommendations, among other provisions.
The bill would also provide a $450-per-student reading incentive grant for districts, though that money would be dependent on legislative appropriations.
While the House bill would change the funding formula base in state law, the actual appropriations would be in the annual operating budget bill — which the governor could veto.
School funding is a top agenda item for this legislative session, with much of the discussion in both chambers over on how the state will pay the bill.
The price tag for House Bill 69 includes $253 million added to the per-pupil funding, plus an estimated $22 million for the reading program, according to the Legislative Finance Division. Without the increase, the budget includes $1.15 billion in state funding for school districts.
“This is a substantial and historic increase to the base student allocation,” said Sitka Rep. Rebecca Himschoot, who sponsored the bill. “Our schools are waiting.”
During debate in the House, Anchorage Rep. Andy Josephson read a list of the severe potential cuts to the Anchorage School District, now facing a $111 million budget deficit, which include sports, staff and programs from preschool through high schools. The district says those cuts would be reversed if the state funding increase is passed.
“How can I possibly say no?” Josephson said.
Corinne Smith of the Alaska Beacon contributed reporting for this story.
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