As the Alaska Legislature prepares to convene, Stutes and Stevens, both moderate Republicans, have their work cut out.
Pressure to increase education funding
Stevens has been a strong advocate for education, and said he continues to be at odds with Gov. Mike Dunleavy, also a Republican, over policy and funding.
“The governor wants to change the rules so that approval of charter schools skips the local school district and goes right to the state board of education, to the Department of Education,” he said. “I don’t think that’s right, I don’t think it’s constitutional, and so I’m really quite opposed to that happening.”
There is at least one charter school in Stevens’ district along the gulf coast, Fireweed Academy, in Homer. Stevens’ district includes Seward and Cordova.
He said he wants one in Kodiak, but is resistant to taking away local control. Dunleavy vetoed a bill that would have permanently increased education funding last session. That was in part because it didn’t include any rule changes for charter schools.
Because of those funding shortfalls, Kodiak could be the latest in the state to close a school amid falling student counts and record inflation. The state has approved one-time funding boosts in recent years, but district officials say it makes budgeting more unpredictable.
Louise Stutes, Kodiak’s Alaska house representative, said one of the best ways to fix some of Kodiak’s education woes is to increase the per-pupil dollar figure that’s the basis of state education funding. Its last significant increase was in 2017.
“I don’t kid myself to think that we’re going to be able to resolve all the ills this year or even next year, but we can certainly get a start on it,” she said. “And so I’m really excited about that and both the House and the Senate have taken the position that that is going to be the first thing on the agenda.”
Using the Constitutional Budget Reserve
Stutes and Stevens also disagree with the governor’s proposal to use the state’s Constitutional Budget Reserve to fund state government and Permanent Fund dividends.
Last month, Dunleavy proposed using half of Alaska’s CBR. That would include giving out $3,800 dividends to every eligible Alaskan.
Stutes said that isn’t a good long-term strategy.
“Our hope this year, too, is to fine tune the budget that we can accomplish what we have to accomplish to keep our state sustainable and people wanting to stay here, but yet — not break the bank doing it and not spend every last dime we have,” she said.
The governor’s budget team is betting on billions of dollars of new revenue incoming as a result of a second Trump administration. The bet is that new royalties and taxes will flow to the state amid a new boom in private sector resource extraction.
Stevens said the Legislature needs to be more fiscally responsible than betting on things that haven’t happened yet.
“Any organization, any government, needs to have a savings account so you can see through the bad times,” he said.
While Stevens said he’s sure many people would appreciate the bigger PFD, residents should expect closer to $1,200 – about a third of the governor’s current plan.
Capital Improvement Projects
The City of Kodiak’s St. Herman Harbor is in dire need of replacement with corroded pilings. That’s the most expensive project it’s trying to take on, but the state hasn’t funded it. The federal government has partially funded the $60 million project.
Kodiak isn’t the only municipality with harbor needs. But Stevens and Stutes both say Alaska’s infrastructure is unlikely to get much help from the state this year … again.
“The way our budget or list looks like now, we probably will not have much of a capital budget,” Stevens said.
“It’s going to be a slog for everybody throughout the state. We have not had any capital money, so to speak – it’s been very thin,” Stutes added.
Stutes pointed out the budgets they’re working on are based on a higher oil price than what she expects by the end of the session.
Retirement program for Alaska’s public employees
The state’s old pension-style program ended for new hires in 2006.
“It practically broke the state, so we’ll never go back to something like that simply because we can’t afford it,” Stutes said.
Instead, the state transitioned to a direct contribution plan, or more of a 401(k)- style plan. Stutes said they need to improve that plan to retain more workers.
Stevens said it’s near the top of his personal agenda because it would help fill vacancies in the Alaska Marine Highway System and public safety.
“A basic retirement system is good and healthy and it would attract teachers and firemen and policemen and all of those folks,” Stevens said
Stevens’ last Legislature
“When I retire, it’ll be 26 years and actually 8 years as Senate president,” Stevens said. “So that’s really unprecedented – that’s never happened before – no one has ever been president that long. So this will be a record-setting thing.”
He said it’s time for someone else to take the reins, but hopes he’s remembered for his work in education.
Stutes has worked with Stevens for about a decade and thanked him for their teamwork over the years.
“I’ve said this 100 times and I’ll probably say it another 100 times in the next two years – I am so grateful for Sen. Stevens,” she said. “He and I are able to work together very closely, very collaboratively, and that cannot be said for all senators and their representatives and it has been a huge advantage not only to me, but to the whole district that we represent.”
The 34th Alaska Legislature gavels in on Jan. 21.
