Dunleavy poised to lose battle over education budget cuts

Funding for public education is an omnipresent issue nationwide, but it can become particularly contentious in Alaska where often unavoidably high costs meet standardized test scores that rank near the bottom nationally.

While the debate usually falls along party lines, this year Republican Gov. Michael J. Dunleavy’s administration has pitted itself against legislators of all political stripes.

Dunleavy has repeatedly cited poor standardized reading and math test scores for Alaska 4th and 8th graders as reasons the state needs to overhaul its K-12 education system.

Correspondingly, his budget proposal released in February calls for cutting the Department of Education budget by $325 million, or about 24 percent, of the $1.3 billion budget, which administration officials have said is a precursor to overall education reform that will focus on reading proficiency in early grades and algebra in middle school.

The vast majority of that cut, $269 million, would be to the block of money that funds the state base student allocation, or BSA, formula that calculates how much state money each school district gets per student. Dunleavy also proposed pulling back a $30 million one-time appropriation for school districts that the Legislature last year for the upcoming 2020 fiscal year.

The $30 million is in addition to the larger BSA block that the Legislature forward-funded in last year for the upcoming budget.

However, Attorney General has Kevin Clarkson outlined the administration’s position that forward-funding state appropriations could violate the constitutional prohibition on dedicating revenue and the governor’s authority to veto appropriations.

Attorneys for Legislative Legal Services contend that the future appropriations signed into law last year by former Gov. Bill Walker are not eligible for Dunleavy to veto unless the Legislature amends or repeals them.

The administration has also withheld a $20 million supplemental payment approved for the current budget until the Legislature officially rejects a proposal in the supplemental budget to repeal it, prompting a lawsuit by the nonprofit Coalition for Education Equity.

Legislators from every caucus — including the House Republicans who have been most supportive of Dunleavy’s policies — have supported funding K-12 at least at last year’s levels.

Dunleavy said during a March meeting with the Journal and Daily News that the $269 million formula reduction close to matches what Alaska’s 53 school districts had available in reserves statewide. The districts could use that money to mitigate the impacts of the budget cuts as the policy reforms are implemented, according to the governor.

“In my mind, I’m thinking, how can we do this so school districts have some money to work with so they can do a step down,” Dunleavy said.

The governor’s spokesman Matt Shuckerow provided a chart indicating districts collectively had $291 million in operating, pupil transportation and capital funds in fiscal year 2017.

The governor said at the time that his administration would be releasing education reform bills within weeks, but those have not yet been submitted.

A March 8 letter from OMB Director Donna Arduin to the Senate Finance co-chairs states that the 2018 district fund balance totals weren’t fully available, but the administration estimated it would be $143 million.

Association of Alaska School Boards Executive Director Norm Wooten said the districts use the reserves to manage cash flow and respond to unforeseen expenses as most other types of organizations do and it’s not in a district’s purview to have more money than they need to operate.

State law limits districts’ reserves to 10 percent of their annual budgets.

“It’s disingenuous to think we can run schools without a fund balance and there’s not a school district in the state to my knowledge that has an excess amount of fund balance that they are socking away,” Wooten said.

The House and Senate have also agreed to at least partially fund the portion of school construction bond debt the state agreed to pay in prior years. The House budget funds half of the state’s $107 million prorated share, while the Senate fully funded the commitment.

Dunleavy proposed eliminating the payments in his budget.

Elwood Brehmer can be reached at [email protected].

Updated: 
05/08/2019 - 9:33am

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