The state school board elicited a firestorm of public comment Wednesday on a proposal that would limit how municipalities can contribute to their school districts. The change is meant to help the state meet a federal funding requirement, but school officials and lawmakers say the measure would have unintended consequences for districts.
Alaska is the only state that still uses the disparity test, to reduce the amount of education funding it provides. The state failed the test in May. At stake is $81 million in federal money that would count towards the state’s education contribution.
Alaska Education Commissioner Deena Bishop said the Department of Law, Department of Education and outside legal counsel crafted the emergency regulation, which would have required approval from Lt. Gov. Nancy Dahlstrom and lasted for 120 days, if the board passed it. Assistant Attorney General Susan Greenlee Sonneborn said the goal was to prevent the “significant fiscal consequences” of failing the federal test.
“This is meant to get this in place within the fiscal year, to reduce the exposure and chance of failing the disparity test,” Sonneborn said.
A public comment section Wednesday was flooded with opposition from school district administrators, legislators, municipal officials and parents. Most questioned whether the emergency regulation was needed and said districts would struggle to fund important programs if it was implemented. Many said that if the state’s per-student funding formula known as the Base Student Allocation had been significantly permanently increased more than once since 2017, the disparity test would not be an issue.
Anchorage School District officials said the change would put $15 million of next year’s already-approved budget at risk. Attorney Matthew Singer told the state board he would file a lawsuit on behalf of ASD if they approved the measure.
“You're being asked to immediately disrupt local contributions to the harm of Alaska students. This is not an emergency,” Singer said. “These circumstances do not meet the statutory definition of an emergency. DEED is asking this board to exceed your rulemaking authority. You’re being asked to violate the law.”
The disparity test measures the gap in per-student funding between the most and least funded school districts. If the disparity is 25% or under, the state can count federal impact aid toward its own contribution to school districts in regions with non taxable federal, military and Alaska Native-owned land.
Sen. Löki Tobin, D-Anchorage, who chairs the Senate Education Committee, issued a letter ahead of the meeting urging members not to approve the emergency regulation. It was also signed by Reps. Rebecca Himschoot, I-Sitka, and Andi Story, D-Juneau. Tobin said the change would harm districts and wouldn’t ensure the state meets the federal requirement in the future.
“I think it's really critical that we understand that the emergency regulation is going to have no impact on our ability to meet federal disparity, and until I see communications from the federal government indicating as such, I'm very reticent to change the system, because it will have severe impacts on local communities ability to support after school activities,” Tobin said.
After the near-unanimous vote to allow for the 30-day public comment period, outgoing board chair James Fields said he was sorry for any anxiety the proposal caused school officials.
“I just want to apologize to the state if it's taken energy away from anything else,” Fields said. “That was never our intent. Our intent is to just try to uphold the law and do what's best for kids, and so I think giving a time of public comment is definitely what's best for kids.”
Rep. Story filed House Bill 212 this legislative session that would allow local funding for non-instructional services outside of the local contribution limit. The bill did not pass, but could see renewed support next session.
Alaska failed the test in 2021, but successfully appealed to the federal government. Sonneborn told board members that the department might still appeal the failure of the 2026 test, based on last year’s data.
