BREAKING: Senate Finance creates a permanent initiative to cover school energy costs and a pilot loan forgiveness program to aid in teacher recruitment

House Bill 28 ensures education funding dollars stay in the classroom while guaranteeing financial accountability.

Hello friends and neighbors,

Yesterday, the Senate Finance Committee released a committee substitute of House Bill 28, a bill that creates a three-year teacher loan forgiveness program, sponsored by Representative Andi Story.

This bill has a the potential to significant help our schools and I look forward to the bill moving out of the Senate Finance Committee tomorrow and making its way to the floor of the Alaska State Senate.

- lgtobin

Included in the legislation are several key education reforms that have the potential to radically improve education outcomes:

Teacher Loan Forgiveness

House Bill 28 includes a three-year student loan forgiveness pilot program for teachers. This program offers full-time public school teachers in special education or STEM (science, technology, engineering, and mathematics) fields student loan grant payments of up to $5,000 per year for three years.

During the 2023-2024 school year, schools across Alaska faced over 1,000 teacher vacancies on the first day, with many positions available in special education, English Language Learners (ELL), and STEM fields. HB 28 aims to encourage both current and new teachers to participate by providing incentives for student loan forgiveness.

School District Energy Grant Program

Education advocates and stakeholders place a high value on targeted state support for quality public education. HB 28 establishes an energy grant program for school districts that reimburses schools for their energy expenditures based on a three-year average of the district’s energy costs. By providing state funds to cover these energy expenses, more base student funding can remain in the classroom, helping reduce teacher-to-student ratios.

Relief for Fast Growing Cities

A new provision in HB 28 aims to limit the contributions that fast-growing municipalities or boroughs must make to their local schools by 5% year over year.

Currently, the average annual municipal growth statewide is about 5%, but some cities and boroughs experience periods of much faster growth. The new provision under HB 28 is intended to alleviate pressure on local budgets, allowing faster-growing cities to retain a larger portion of their local property taxes for other services and to smooth out increases in required local school funding.

By setting the limit at 5%, the goal is to help fast-growing cities “catch up” with slower-growing municipalities and boroughs that will not benefit from this provision. A previous bill (SB 278) proposed a lower limit, which would likely have increased the disparity in required local school funding between municipalities.

While this change does not increase base school funding, it provides tax relief to some of our fastest-growing cities. Many of these communities have struggled to make the maximum permitted additional contributions to their local schools. By easing this burden, those cities and borough assemblies will be able to support their schools fully.

Senator Tobin and Senate Majority Leader Giessel answer questions during a Alaska Senate Majority Weekly Press Availability

The legislative session has entered it’s final days and we are scheduled to wrap up by midnight on Wednesday. There are many items in flux, as there often is at the end of session. Legislators and staff will be working long hours in the coming days to ensure that the priorities of Alaskans are moved forward. I will provide an end-of-session update later this week.

As a reminder to Chugach Electric Association members, Board of Director elections are open through May 29th. Members can vote online through the portal on the Chugach Electric Association website. Your vote is your voice in local energy policy!