By: Corinne Smith, Alaska Beacon
Lawmakers in the Alaska House passed a bill that aims to stabilize budgets for Alaska school districts by redefining how they calculate their student counts. The student count makes up the base of the state’s education funding formula.
Lawmakers passed House Bill 261 by a 31 to 9 vote, with bipartisan support, on Tuesday. Under the new calculation of the student count, the bill would provide an additional $143 million in state funding to school districts next year.
But with competing education funding and policy proposals in the Legislature — and just seven days left in the legislative session — the bill heads to the Alaska Senate for consideration and its future is uncertain.
The legislation, sponsored by Rep. Andi Story, D-Juneau, would allow school districts to make their student counts and budget estimates earlier in the year. Currently, schools make an estimated student count in October, and revise it in the spring. Under the proposed legislation, districts would use the previous three-year average of their student count — or the previous year’s count, if it is more than 5% higher.
Story described the change as a way for school districts to get off a budgeting “rollercoaster” and allow districts to have firmer budget estimates, including more certainty in offering contracts to teachers and staff in the spring.
“This is such a policy change that would so help Alaska stabilize education and get more relief and more certainty, and less stress for our families,” she said Tuesday, after the vote.
Alaska school districts are grappling with major budget deficits and rising costs, which have them planning cuts and teacher and staff layoffs across the state — at least 11 schools are slated for closure — amid years of ongoing debates among legislators and Gov. Mike Dunleavy on how much the state should fund education.
School districts currently estimate their student counts in October and draft budget estimates in the spring, and sometimes up to the first day of school in the fall. But with declining enrollment and other changes among student populations, those budget estimates can change, leaving districts uncertain about what staff or programs will be offered in the fall — as well as how much state funding they will receive. Under the new legislation, districts would instead have a solid student count number to budget off of in the year ahead.
Additionally, the bill would change how districts count students who receive intensive special education services. Districts could use the previous year’s count, or the current year’s count in October or in February.
“And what’s great about smoothing is it can help them plan for their educational programs when they are in a climate of declining enrollment,” Story said. “Other states are doing this, and they don’t have the volatility that we do. Because our process, our funding process timeline, is messed up, it really is.”
Alaska has seen a steady decline in enrollment in public schools in recent years, with more students and families opting to enroll in homeschool programs and private schools, or leaving the state altogether. When student numbers decline sharply, the state has a “hold harmless” provision which protects districts from funding dropping dramatically, and phases funding down over three years. Proponents of the legislation say the more predictable student counts and budgeting will help districts with long term stability, their ability to retain teachers and attract new students.
The adjusted student count would have varying effects on school districts statewide — a state fiscal analysis projects the Anchorage School District would receive $31 million more next year. Sitka would see $2 million more, and Yukon-Koyukuk would see $3.8 million in additional funding. But several districts would see less funding under the new calculation, like the state-run boarding school Mt. Edgecumbe High School.
Members of the Alaska House debated and passed an amendment to the bill which would also change the calculation for local municipalities’ contribution to school districts in the state’s complex funding formula, known as the local contribution.
Rep. Justin Ruffridge, R-Soldotna, sponsored the amendment that would cap municipalities’ contribution at a fixed increase of 2% annually, which would relieve boroughs seeing rapidly rising property assessments — those assessments inform how much they contribute to their local schools. Ruffridge said large boroughs like the Kenai Peninsula, Matanuska-Susitna and Anchorage, which are seeing rising property values, are shouldering education funding that should be placed on the state. The adjustment is estimated to cost the state $30 million next year.
“What you’re seeing in a lot of districts with high increases to property assessment values is their required local contribution is going up and up,” Ruffridge said in an interview on Wednesday. “As a result, they’re being required to pay a significantly higher portion, so to the state it looks like the state funding to schools is going down. That’s what it looks like. And on the municipal side they’re being asked to pay more and more and more.”
The amendment passed by a 24 to 16 vote, with Story among those opposing. After the vote she called it a “significant change” and said she had concerns about capping funding for education.
The prospects of the bill are uncertain. Sen. Löki Tobin, D-Anchorage, who chairs the Senate Education committee said Tuesday the policy changes will need to be vetted by the Senate with just days left in the session.
“Bringing everybody along while we are also trying to deal with property tax bills and sales tax proposals and a Rural Health Transformation Fund and all these different healthcare compacts, along with the omnibus crime bill, and of course, the budgets, it might just be too much for us to take that large of a bite,” Tobin said. “But I do believe that components of House Bill 261 will end up in the final package.”
“I’m not trying to be a future teller by saying what is and is not going to continue to be considered by this body,” she added, and said that it’s likely the policy changes will be taken up by the Task Force on Education Funding. “This could be a part of that overall package you see introduced in the 35th Legislature.”
The draft bill redefining districts’ student counts would cost an estimated $113 million, plus additional provisions, for a total of roughly $143 million.
Meanwhile, the Senate is in the process of considering another “mini-bus” education bill, also originally authored by Story, which would fund an additional $82 million for schools, including targeted funding for transportation, energy relief, reading instruction and career and technical education programs.
A draft budget passed by the Senate includes up to $100 million in one-time funding for schools, if oil prices remain high. The House drafted a budget with nearly $158 million in one-time education funding — the two proposals are currently being negotiated and compiled by a conference committee of three senators and three representatives over the next few days.
The bill is subject to a reconsideration vote on Wednesday at the request of House Minority Leader Rep. DeLena Johnson, R-Palmer, which delays the bill’s transmittal to the Senate.
