Alaska school officials say one-time funding increase leaves budgets unpredictable

a Juneau educational rally
Educators, students, and parents rallied in front of the Alaska State Capitol on January 23, 2023 to call for an increase in the basic student allowance. (Katie Anastas/KTOO)

The budget that the Alaska Legislature passed last week includes a one-time increase in school funding of $175 million.

School district leaders and many lawmakers were hopeful that the basic student allocation, part of a formula that determines how much money schools receive from the state, would increase significantly this year. And they say the one-time funding approved instead won’t solve current budget problems.

“Until we do structural reform to school finance, we will always be in these conversations where we talk about deficits and budget cuts and layoffs and layoffs,” Anchorage School District Superintendent Jharrett Bryant said.

Districts plan for deficits

The Anchorage School District expects to get almost $50 million from the one-time increase, if approved by Governor Dunleavy. But chief financial officer Andy Ratliff said the lack of a permanent funding increase makes planning for 2025 difficult.

“It gives you an incentive to just save it and not spend it, knowing you’re going to have a bigger deficit the following year,” Ratliff said.

Juneau School District officials also anticipate budget challenges for 2025. Cassee Olin, director of administrative services, said the district expects to get $5.4 million of the $175 million increase.

“Basically, we will start building our budget in FY 25 with a deficit of $5.4 million,” Olin said.

That means the district likely won’t spend the money on new and recurring costs, like hiring teachers. Instead, he said, they could spend it on online classroom materials or maintenance projects.

“We would like to try to focus on non-personnel expenses with the additional funding, something that we don’t necessarily have to have in the next few years,” he said.

Without a permanent increase in funding, districts may have to address shortfalls in other ways, such as closing schools, increasing class sizes, and reducing bus service.

A safety valve until next year

Several legislators spent this year’s session pushing for a permanent increase in school funding.

Senator Löki Tobin, D-Anchorage, chaired the Senate Education Committee this session. He advocated for the Senate version of a bill to increase the basic student allowance by $680.

“It seemed like, until the end, there was a way forward,” he said. “I think we in Senate Education and again in Senate Finance were able to really articulate why an increase under the BSA was the best, most equitable and just way to support our education system.”

Instead, the base student allowance will only increase by $30, an increase Dunleavy approved last year, bringing the base number to $5,960. The exact number a district receives per student can change based on factors such as the size of the school and whether a student has intensive needs.

Tobin said that without a significant increase in the base student allocation, the next best option was a one-time funding increase. She called it a “safety valve” to hold schools until the Legislature can resume talks on basic student allocation next year.

Tobin said he’s optimistic Dunleavy will approve the one-time push.

“I know that he is an advocate for our schools. I know that he recognizes the value of a good quality public education,” Tobin said. “I’m hopeful that he sees this budget balanced and uses his veto very little.”

School boards and district administrators from across the state will meet in the coming weeks to discuss next steps. Dunleavy has 20 days to review the Legislature’s budget once he receives it.