JUNEAU -- State reimbursement for much of the cost of Anchorage's new school bonds was thrown into doubt Tuesday when the Senate's Education Committee made retroactive a bill that would eliminate state reimbursement for new bond issues, such as the one voters will decide in April.
"It broke my heart; I've never voted against school bonds," said Sen. Berta Gardner, D-Anchorage, who said she reluctantly supported the proposal out of fairness to other cities but acknowledged it may threaten the bond election.
The Anchorage School District is seeking $59.25 million from taxpayers for a series of school projects and needs voters' approval to take on the debt. But with the state's general fund picking up as much as 70 percent of the cost of paying off those bonds under current law, it has long been thought that voters are more likely to approve such bonds.
Despite that subsidy, Anchorage School District bond propositions have have had mixed results in recent years, but in 2014 voters gave their strongest endorsement of school construction in recent years, with more than 58 percent of voters approving.
But as oil prices and state finances collapse, state leaders are looking for ways to cut costs. Sen. Anna MacKinnon, R-Eagle River, said the automatic debt reimbursement was costing the state more than $100 million a year, and under current law there was no way to control that cost.
"Anyone can go out and bond, in any community in Alaska that has that capability, and the bill comes back to the state of Alaska" for the match, she said.
MacKinnon's Senate Finance Committee introduced a bill calling for suspending new entrants into that reimbursement program for five years. It would have taken effect on May 1, after the April Anchorage bond issue.
That angered other districts that don't go to the ballot on the same cycle as Anchorage and wouldn't be able to get one last round of projects approved for reimbursement.
"It allows Anchorage to take one more bite of the apple and it leaves the rest of us out there alone without any way of doing that," said Mark Miller, superintendent of the Juneau School District.
MacKinnon, who served on the Anchorage Assembly when her last name was Fairclough, drafted the bill the Senate Finance Committee introduced.
The Senate Education Committee on Tuesday made the bill retroactive, blocking state reimbursement for bond issues approved after Jan. 1.
But MacKinnon is in full support, said Laura Pierre, a member of her staff. That was her original intention, Pierre said.
Anchorage School District officials were unavailable for comment Tuesday following the late committee action, but have said previously that if the debt reimbursement program ends, the election would go forward and taxpayers would have to pick up the full costs.
For every $100,000 of assessed value, that would mean an annual cost of $14.11. With state assistance, that annual cost would drop to $5.59 per $100,000 value, according to the district.
Gardner said she assumes that will make approval more difficult to obtain, but that she still intended to vote for it at the polls.
The bond issue this year would provide funding for expansion and renovation of Gladys Wood Elementary School and upgrades and renovations of Mountain View, Rabbit Creek and Turnagain elementary schools. It would also pay for improvements at West and East high schools and Fire Lake and Inlet View elementary schools.
Correction: This story originally stated Anna MacKinnon served on the Anchorage School Board. She actually served on the Anchorage Assembly.