The Alaska Senate has passed a bill that would stop state reimbursement of new school bonds, including ones that are currently being considered in Anchorage.
Right now, the state covers up to 70 percent of the cost of school construction bonds issued by municipalities. But with the state facing a multi-billion-dollar deficit, legislators are wary of taking on additional obligations. The legislation sunsets the school debt program for five years, at which point the program would be brought back with a lower reimbursement level.
Sen. Anna MacKinnon, an Eagle River Republican, carried the bill on the floor Wednesday.
“This is not about punishment. This is about trying to control our costs as a state,” said MacKinnon. “I believe that the people of Alaska know that the state cannot afford to make the payments. We certainly can’t afford to take on increased debt.”
While the bill passed 17 to 2, there was some opposition from Anchorage Democrats because of the timing of the bill. The legislation would retroactively sunset the program to January 1. But right now, Anchorage voters are already casting ballots on a $60 million school bond question.
Sen. Bill Wielechowski argued that the Legislature was rushing the bill through because of Anchorage’s municipal election.
“They’re voting based on 22 years of 100 percent reimbursement, 35+ years of state reimbursing some percentage. And so, people in my community are out and voting, and this is what they’re voting on. This is what the state’s told them,” said Wielechowski. “This causes all kinds of confusion in the election in Anchorage, and I think it’s unfair.”
Wielechowski added that the program would amount to a property tax increase of $30 for the average home in Anchorage.
Anchorage Democrat Berta Gardner also expressed concern over the legislation, but ultimately voted for it.
“While our children certainly need safe and comfortable school building for learning to take place, I think at this time right now, I think we need to focus more on what happens inside the buildings than what’s happening on the outside of buildings,” said Gardner.
The bill will now be considered by the House.