Alaska’s rural schools are grappling with a severe funding crisis, leaving them in dilapidated condition and creating unhealthy environments for students and teachers. During a visit to a public school in Sleetmute last fall, Alaska House Speaker Bryce Edgmon labeled the school as “the poster child” for the mismanagement of state funding regarding school maintenance and construction issues. Located 240 miles west of Anchorage, the small community has awaited nearly two decades for financial assistance to repair a leaky roof that has left parts of the building on the verge of collapse.
After the tour, Edgmon expressed intentions to advocate aggressively for education funding reforms when returning to the Capitol in Juneau for the 2025 legislative session. Other lawmakers echoed similar frustrations after an exposé by KYUK Public Media, NPR, and ProPublica revealed that the state has largely neglected hundreds of repair requests from rural school districts, including Sleetmute. The investigation found that funding shortcomings put students and educators in remote areas at significant health and safety risks.
State Senator Elvi Gray-Jackson, a Democrat from Anchorage, called the findings “heartbreaking” and stated in an email that the current state of the schools is “unacceptable.” Fellow State Senator Scott Kawasaki acknowledged in his communication that “the responsibility lies squarely on the Legislature” and admitted, “we do not do enough.” Alaska Senate Majority Leader Cathy Giessel, a Republican representing part of Anchorage, remarked that efforts are being made to “right the ship!”
Despite the urgent discussions around education funding this year, lawmakers managed to pass only $40 million for school construction and maintenance, a mere 5% of the nearly $800 million that districts estimated is necessary to ensure their buildings remain safe and operational. In June, Governor Mike Dunleavy vetoed more than two-thirds of the funding, which amounted to nearly $28 million, citing a budget constrained by declining oil prices.
In a video message, Governor Dunleavy emphasized the grim economic outlook for the state and explained that dwindling oil revenues resulted in a lack of funds to meet all financial obligations. The reliance on oil revenue has long been recognized as a precarious strategy for state budgeting, and legislators have repeatedly failed to reach a consensus on a sustainable approach for financing school repairs. Currently, Alaska is among only two states in the nation without an income tax or a statewide sales tax.
A report by the University of Alaska Anchorage illustrates a staggering 60% decline in average annual spending on education facilities since 2014, the year in which oil prices plummeted. Presently, funding allocated for rural facilities is less than half of the amount recommended by the National Council on School Facilities. Senator Löki Tobin of Anchorage, who chairs the Senate Education Committee, expressed difficulty in garnering momentum for various funding solutions, remarking that awareness of chronic underfunding has been insufficient.
The legislative environment seemed conducive this year for addressing education funding issues, with several new candidates from both parties campaigning on education improvement and winning their seats. Tobin noted that a focus on adequate school funding was instrumental in flipping an entire statehouse during the recent elections. As the session commenced, lawmakers introduced a bill aimed at elevating education funding, and numerous stakeholders—superintendents, students, and school board members—advocated forcefully for increased investment in core educational needs.
Amid the legislative discussions, a Senate Finance Committee hearing revealed concerns raised by co-chair Lyman Hoffman regarding the potential for costly civil rights lawsuits linked to the state’s treatment of predominantly Indigenous communities. He warned that taking no action on school conditions might ultimately be more expensive than proactively addressing the issues.
In April, both the Alaska House and Senate passed an ambitious bipartisan bill aimed at significantly increasing per-student spending for the first time in nearly a decade; however, the bill did not allocate any capital funds for necessary construction and maintenance. Shortly thereafter, Governor Dunleavy vetoed the proposed increase, arguing it inadequately addressed provisions for homeschooling and charter schools, priorities he has championed for years.
Before the legislative session drew to a close in May, a compromise bill passed that included reduced spending and rolled back certain regulations surrounding charter schools. Although lawmakers managed to override Dunleavy’s veto of this compromise, it was followed by another detrimental line-item veto which slashed 3% from the education budget. This marked the most significant cut among all state departments, exacerbating concerns about the adequacy of educational funding in Alaska.
Alaska’s overall budget for 2023 totaled $14.7 billion, roughly $1 billion less than the previous year. Lawmakers have characterized the budget as “bare bones” and insufficient for addressing the state’s pressing needs. Among the governor’s cuts was over $25 million intended for school construction and maintenance. The stringent funding conditions mean that even the most critical maintenance projects risk being left unaddressed; school districts submitted 84 proposals this year, but there isn’t enough funding for even the top three on their lists.
The dire situation extends to communities such as Stebbins, where a school burned down last year, leaving over 200 K-12 students attending classes in makeshift buildings. Mayor Sharon Snowball expressed concern about the loss of students who relocated to attend boarding schools or live with relatives elsewhere after the fire.
Similarly, the Mertarvik school district failed to secure funding for constructing a wastewater system needed for a school set to open in 2026, leaving them unable to provide clarity on how to proceed with the project. Governor Dunleavy has scheduled a special session for lawmakers in Juneau on August 2 to discuss potential reforms for Alaska’s education system. However, it remains uncertain whether funding for vital maintenance and construction will be part of the agenda.
The budget crisis has critically affected rural school districts, which depend almost entirely on the state budget for resources to maintain and repair their facilities. These districts serve unincorporated communities that lack the authority to impose taxes for funding support. The state budget relies heavily on revenue from crude oil production, which is deposited in the state’s Permanent Fund—a crucial financial resource that covers over half of Alaska’s operational requirements.
The Alaska Department of Revenue reported that prices of crude oil from the North Slope have fallen by over a third from 2014 to spring 2023. Economists project this decline will yield a budget deficit exceeding $1 billion by the upcoming year, a situation exacerbated by decades of neglect in addressing the comptroller’s warnings about budget sustainability.
Once a financially stable state, Alaska has seen daily oil production drop to a quarter of its former peak, which occurred in the 1980s. Lawmakers have struggled with developing actionable solutions to rectify the looming financial crisis. Legislative discussions have encompassed various proposals, including adjusting the annual dividend checks given to Alaska residents from the Permanent Fund, which guards against poverty for many residents.
The common opinion among lawmakers has been that cutting these payments, which averaged over $1,700 last year, is politically unviable due to their widespread popularity. Some lawmakers are pressing for a return of the statewide income tax or a sales tax to generate revenue, yet such measures have not gained significant traction. In 2021, a bipartisan working group explored the feasibility of taxation but returned no definitive recommendations, leaving many feeling discouraged about the prospects for generating necessary funds.
After serving in the working group, Representative Kevin McCabe, a Republican from north of Anchorage, concluded that taxes might not yield the required revenue to address the state’s infrastructure deficiencies. Alaska previously had a special education head tax on residents, which was abolished in 1980 due to increased oil revenues that allowed for greater financial flexibility.
Former Senator Click Bishop, who is contemplating a run for governor, has suggested reinstating the education tax, although projections indicate it would generate merely $14 million annually—far short of rectifying the acute funding deficits faced by schools. Concurrently, some lawmakers argue that constructing a natural gas pipeline could serve as a more viable long-term solution for funding both schools and the state’s overall budget.
With estimates currently identifying potential untapped natural gas reserves in Alaska that amount to over a hundred trillion cubic feet, the inability to transport this resource to market has hindered potential revenue generation. Described as “big, expensive, and complex” by industry experts, discussions gathered over the past five decades about the pipeline remain unresolved; last estimated at a $40 billion construction cost, investor interest has recently surged, but clarity on funding sources remains elusive.
In conclusion, the future of Alaska’s rural schools and the state’s educational framework hangs in a precarious balance, as lawmakers continue to grapple with the deeply entrenched economic issues and the urgent need for reform in how schools are financed.
image source from：npr
