Alaska News

Anchorage joins fight over school bond debt reimbursement

Anchorage Mayor Ethan Berkowitz said Friday that he will join the fight over school bond-debt reimbursement and ask Gov. Bill Walker to reinstate the program that lawmakers put a five-year stop to this year.

If the state affirms an earlier decision that a bill passed by the Legislature is properly applied retroactively, Anchorage taxpayers will have to shoulder the total cost of the $59.3 million school bond package approved by voters in April. For more than a decade, the state has helped pay for 60 percent to 70 percent of school bond debt, until this year when it ran into a multibillion-dollar budget gap and put a controversial halt on the reimbursement program.

Lawmakers made that five-year moratorium retroactive to Jan. 1 in Senate Bill 64, impacting April's school bond package after voters cast their ballots.

"It's just a fundamental question of fairness," Berkowitz said at a meeting Friday attended by members of the Anchorage School Board, Anchorage Assembly, city officials and Anchorage School District administrators. "It is unfair for people to go to a ballot and vote on a bond with the expectation that they're going to receive debt reimbursement and for the governor to retroactively pull it away."

The state Department of Education and Early Development sent letters to the Anchorage School District and Bristol Bay Borough School District in August saying it would not help pay for school bonds approved by voters in April. Other school districts put their bonds up for votes later in the year.

Anchorage School District Superintendent Ed Graff sent a letter Thursday to Mike Hanley, commissioner of the state education department, asking for the state to reconsider its stance on stopping reimbursement. Graff wrote that the Legislature had received legal opinions that the approval of a bill that would retroactively withdraw eligibility for reimbursement "may be challenged as unconstitutional."

"SB 64 did not become a law before April 7, 2015," he wrote. "Indeed, it did not become law until months later. The Legislature did not take the steps necessary to avoid the unconstitutional effect of the law."


Heidi Embley, Anchorage School District spokesperson, said the school district has already started construction on the $11.5 million project at Rabbit Creek Elementary School and the $13 million project at Mountain View Elementary School. All other six projects were on track, she said.

She said the bonds to reimburse the projects' costs have not yet been sold. Taxpayers will not see the impact of the bond sale until next year at the earliest, she said. The school district has said that without state reimbursement, the $59.3 million bond package will cost the owner of a $100,000 house $14.11 more in annual property tax. With reimbursement, the same homeowner would pay an additional $5.59.

Hanley did not immediately respond to a request for comment Friday.

Sen. Anna MacKinnon, R-Eagle River, said in an interview that she understood Berkowitz's concerns, but she said the state was wrestling with a multibillion-dollar budget gap and had chosen to put what money it had into classrooms instead of buildings.

Walker said in an April message to Senate President Kevin Meyer that had let the school bond reimbursement bill become law without his signature, saying it appeared some members of the public were confused about its retroactivity. But he also said the bill was "legally sound."

Tegan Hanlon

Tegan Hanlon was a reporter for the Anchorage Daily News between 2013 and 2019. She now reports for Alaska Public Media.