Juneau update: James Brooks does the math on school funding and Alaska Permanent Fund dividends

Man in plaid jacket.
Alaska Beacon reporter James Brooks covers the Alaska Legislature for the Alaska Beacon. (Courtesy of James Brooks)

In Juneau, legislators are six weeks into their session. The big controversies so far are education funding and employee pensions and as always the size of the permanent fund dividend. Alaska News Nightly Host Pro Tempore Liz Ruskin interviewed Alaska Beacon reporter James Brooks to get a progress report.


This transcript was lightly edited for clarity.

Liz Ruskin: James, is anything happening there at the Capitol? And how is the mood?

James Brooks: It’s actually pretty quiet in the Capitol this week. There’s a fair number of legislators who are headed out to Washington, D.C. this week in order to lobby support for the Willow oil project. It feels like we’re in the middle of the session. Legislators have had about 45 days now to get to know each other to get up to speed. Because remember: there’s a lot of new faces. More than a third of the legislators are new this year.

LR: Let’s discuss what the governor wants. Gov. Mike Dunleavy revealed a new budget plan in mid-February. What are the major elements there?

JB: Yeah, the governor has proposed a few budgetary solutions for some of the problems that Alaskans are seeing now. For example, the food stamp issues. There’s a lot of people who are going hungry right now, because they haven’t been able to get access to food stamp (SNAP) benefits. The governor has proposed funding for new workers to process those food stamp applications and move more quickly on that. He’s also proposing more funding for public defenders. (Providing attorneys for indigent defendants) is a constitutional requirement. But right now, it seems like some of those agencies might be falling short. He’s also proposed a Permanent Fund dividend of about $3,900 per person. At $2.5 billion, that’s the largest single item in the budget.

LR: Tell me about the proposed increase in per-student spending. Where’s that coming from?

JB: In the Capitol, we’ve heard a lot of presentations from school district officials, school superintendents, ordinary parents and teachers who have said that local schools are really suffering right now from the effects of inflation. School supplies, fuel and electricity, basic costs have gone up enormously for school districts. The state of Alaska pays much of the cost to run K-12 schools throughout the state, and one of the key components of that funding is what’s called the base student allocation. It’s how much the state pays school districts per student. There’s been a lot of talk about increasing that BSA, as it’s known, in order to compensate for inflation. We heard earlier this year that to match what schools received in 2015, the BSA would need to rise about $1,300. And that works out to more than $260 million statewide. So that’s a pretty big ask. There’s been some questions about whether the state is getting a good enough return on its money, particularly from Republican lawmakers who want more accountability measures. But we also heard today from Democrats and independents who noted that last year, the Legislature, at the urging of the governor, passed the Alaska Reads Act, which does impose some of those accountability measures but didn’t include much additional funding. And so they’re considering the BSA increase to be the second half of what’s needed.

LR: If you had to guess, where do you think the BSA increase will end up? Do you think a significant increase is realistic?

JB: I think the most likely scenario right now is that the Legislature includes a one-time bump in the budget, and any permanent increase seems like it would be an issue for next year.

LR: I was really struck by something Senate Finance co-chair Bert Stedman said when arguing that the state can’t afford a dividend of the size of the governor wants. He said: “We’re going to have to make a choice. Do we want to teach our kids to cash checks? Or do we want to teach them to read and write and do arithmetic?” Is that how it is, that increased education spending or any other big-ticket item will come at the expense of the dividend?

JB: It’s really turned into a tug-of-war. And you’re not wrong, because legislators so far have been unwilling to consider tax increases or new revenue that could be done quickly. So if you’re looking at the problem for this year, it’s a tug-of-war between the dividend and every other priority the state has. So if you, for example, were to take the governor’s proposed $3,800 dividend and cut $1,000 off of that, you could have a fairly large dividend and cover both the BSA increase and the spending that’s been proposed already.

LR: Do you have a sense of whether lawmakers have made progress on resolving these big issues?

JB: I think for the first part of the session, the weeks that we’ve seen so far, legislators are getting their hands around the problems. I think in the days to come we’ll start to see them grapple with solutions, looking at what ideas will work best to fix the problems that they now have a better understanding of.

This interview was lightly edited for clarity.

Liz Ruskin is the Washington, D.C., correspondent at Alaska Public Media. Reach her at lruskin@alaskapublic.org. Read more about Liz here.

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