The Fairbanks North Star Borough Assembly voted 7-2 on Thursday to approve a resolution that sets local education funding at $60 million for the upcoming fiscal year.
State law requires the Assembly to provide a specific amount to fund the Fairbanks North Star Borough School District 30 days after the district submits its recommended budget.
The $60 million mark reflects what Borough Mayor Grier Hopkins promised to recommend for local education in January. It is $2 million above what the Assembly approved last year and $20.1 million above the statutory minimum required local contribution.
“It sets the floor for what you would provide,” Hopkins said. “That floor is what you would be legally required to stick to as you cannot go below it. You can certainly go above it.”
Hopkins added the resolution doesn’t dictate where the funding would come from. That decision resides with the Assembly, though Hopkins has proposed drawing $9.5 million from savings to balance the overall borough budget.
Alaska mandates that municipalities with education powers provide a minimum local contribution to education as part of the state funding formula. The amount is based on the maximum taxable assessed property value. For FNSB, the minimum contribution was $39.9 million, though the borough traditionally funds well above the threshold.
‘Strong investment’ in students
Hopkins noted that if the borough flat-funded education, it would be the equivalent of a $1.2 million cut because the borough’s assessed property values increased.
The school board approved its recommended budget with the assumed $60.1 million in mind. It also budgeted for a $680 increase in the state’s per-pupil Base Student Allocation. On Friday, the Alaska Legislature approved a bill that would provide a permanent $1,000 BSA increase. However, Gov. Mike Dunleavy promised he will veto the bill after the Senate Finance Committee removed key education reform provisions.
“We should do what we can to take control of the numbers and increase education spending and support the students in our community as they need,” he said.
School board member Brandy Harty noted that $60 million was critical, as a lesser amount would affect state and federal impact funding. The district has already made harsh cuts, including closing three schools, slashing $1 million reserved for vacant positions, increasing class sizes by one student across all grades and $500,000 in administrative costs.
“The $60 million reflects a strong investment by this body to our schools and the students we serve,” Harty said.
She later noted that flat funding would result in the reduction of federal impact aid, which is provided in lieu of taxes. In most states, impact aid funding flows directly to school districts, but Alaska applies a disparity test.
Flat funding, she said, would amount to a combined $1.4 million loss of revenue the district didn’t budget for.
“The school board would need to go back and find $1.4 million in reductions,” Harty said.
During public testimony, school board president Melissa Burnett voiced similar support for the $60 million, adding that students, teachers, and district staff need stability and that the community “deserves schools that are equipped to grow and thrive.”
Burnett recommended that the Assembly make fiscally responsible choices that don’t involve dipping into the borough’s savings, such as reallocating funding from the capital budget or rethinking how the borough budgets for vacancies.
”We understand that the borough must balance priorities, but we ask that public education be at the top of that list,” Burnett said. “This is an investment in the future of Fairbanks.”
Assembly mixed
Most Assemblymembers agreed about education being a priority but supported finding cuts elsewhere in the upcoming budget workshops.
“If we want to live within our means and fund education, maybe we should be looking at some other cuts and not dip into fund balance so much,” said Liz Reeves-Ramos. “But I am 100% on board with funding our public schools at $60 million.”
The school district starts its budget process early before knowing whether the Alaska Legislature will provide additional funding or the borough approves its budget. If funding falls short of what the district requests, or if the governor vetoes or reduces the legislative appropriation, the school board must make further cuts.
Kristan Kelly, while agreeing that the state should fund education, dismissed the claim that local increases burden taxpayers.
“If we take that approach, whose back [the burden] goes on is our children and the future of this community,” Kelly said.
Assemblymember Tammie Wilson opposed the resolution, noting that the borough and state are still in the middle of their budget processes. She added that she couldn’t justify drawing funding from the borough’s savings.
“I am in hopes that as we go through the process, amendments will be brought forward to show what our priorities are and find $2 million in savings from other areas,” she said.
Assemblymember Barbara Haney, who voted no, said the resolution set a minimum of $60 million, not a maximum amount. She added drawing on savings appeared to be a recurring theme, as the Assembly approved a similar decision in 2024.
“I think we’re getting in over our skis a bit,” Haney said. “I don’t think we should be dipping into fund balance; it’s an untenable decision, and we need to figure it out.”
She added that while she understands Hopkins’s stance on local funding, education funding is the state’s responsibility.
“To put on the property taxpayers here the additional burden from the state legislator is wrong,” Haney said.
Hopkins agreed that the state should fully fund education, but he doesn’t expect that to happen soon.
“With the laws that have been on the books for 30 years, this is the world we live in now,” Hopkins said. He added that the borough would need to draw on savings whether or not education had a $2 million boost.
Budget process ‘beyond backward’
Brett Rotermund supported the resolution but condemned the state’s education funding process.
“This is so beyond backward it defies description,” Rotermund said. “We’re sitting here arguing over numbers that don’t exist. That is the dumbest way to budget ever.”
Like Reeves-Ramos, he challenged the Assembly to find savings within the budget.
“We are at a crossroads in this community and have got to decide what we’re going to fund and not fund,” Rotermund said. “The people in this community have made it painfully clear to us they want no more taxes and to remain in the tax cap.”
Scott Crass noted the borough must continue to support its schools “until we find other ways to support them ... without our children, we are nothing.”
However, he cautioned there is little else in the budget the Assembly could cut to shift toward education.
“There’s no more meat on the bones and if you’re looking to make cuts, you need to identify services you want to end,” Crass said.
While the Assembly adopted the resolution, it must still appropriate the funds when it approves the borough budget in May. The school district presents its budget at 5:30 p.m. on April 17 during an Assembly Finance Committee meeting.