(4-minute read) ‘SHOOT THE MESSENGER’ DAY IN SENATE FINANCE
Senate Finance members didn’t like the Education Department budget rollout, and Republicans and Democrats alike told the Office of Management and Budget Director their opinions, in no uncertain terms, during a hearing that was at times a bit of an inquisition.
“The question was asked why we’re doing what we’re doing. We’re doing this because the State is out of money, and we need to balance our budget,” OMB Director Donna Arduin had said to the committee.
“We’re draining reserves to do it, and we’ve run out of reserves to drain. We’re proposing this so we can get our budget balanced and our fiscal house in order,” she said.
“With all due respect, ma’am, that’s the wrong answer,” said Sen. Click Bishop of Fairbanks, who had asked the question: How does less money lead to better outcomes?
Sen. Lyman Hoffman of Bethel called the 25 percent cut to the state’s portion of education funding “completely unacceptable.”
But Sen. Natasha von Imhof had a different perspective. She acknowledged that overall enrollment in Alaska’s schools has declined from 131,000 in 2006 to 129,000 in 2018, but that funding has gone up and up.
In 2006, state funding for schools was $805 million, but rose to $1.2 billion in Fiscal Year 18, and $1.34 billion in FY 19.
“So student count is going down, money is going up. What is going on? I’m not really hearing that from you. What I’m hearing is, we’re just going to cut it.”
von Imhof then explained that employee benefits had gone up from $302 million in 2006 to nearly $600 million in 2017, the latest figure available to her.
“That is a $294 million increase in 11 years, or 97 percent,” von Imhof said. “So districts are spending less on books and curriculum and more on health care for their teachers.”
Rather than making an across the board cut that leaves all 53 districts to figure it out on their own, a better approach might have been to help districts with their highest cost driver, and see if the State can come up with a solution that makes sense.
“And I’m not really hearing that,” she said. “And I think that’s a problem because Education is dealing with it, all the departments are dealing with it.”
“Why didn’t you address the largest cost driver in Education?” von Imhof asked.
Arduin was ready: “The first part is that we don’t control school districts and we don’t control how they spend their money. We have data that is similar to that, that shows that money is being spent elsewhere rather than for instruction.”
Only 54 percent of State dollars that go to districts is used in the classrooms, she said. They also receive local funds, referring to those school districts in organized boroughs.
Arduin said that the Education Department would be open to proposals to help drive down the cost of employee benefits, which have exploded.
But Hoffman piled on testily: “It’s all about the checkbook. It should not always be all about the checkbook. It can’t be only about the checkbook. It has to be about our obligations to educate students.”
The Education budget proposed by Gov. Michael Dunleavy cuts the State’s $1.34 billion contribution to education down to $1.03 billion. This doesn’t count the local contribution.
Included in the plan is a 50 percent travel reduction for Department of Education employees, $269 million in reduction to the per-student funding known as the base student allocation, and clawing back $30 million that last year’s Legislature had promised to schools for FY 20. The proposal also plans to end the WWAMI medical school exchange program for a $3 million savings,
At one point committee Chairman Sen. Bert Stedman reminded the members who were getting agitated as the hour went on, that it is not the OMB director’s budget but the governor’s budget.
