House Finance panel debates "Come Back Home" loan-repayment pilot to recruit teachers and state employees

Representative Andy Story on May 8 presented House Bill 28, a three-year pilot designed to encourage former Alaskans to return to the state workforce by offering student loan repayment assistance to teachers and state employees.

"This program would provide $8,000 per year for up to 3 years, paid directly to a participant student loan servicing institution after each year of completed service. It is capped at 20 participants," Representative Story told the House Finance Committee. Story said the pilot would be funded from the Alaska Higher Education Investment Fund (HEIF) and that the $1 million-per-year proposal was intended as a modest pilot to attract roughly 120 years of service over three years (20 participants x up to 3 years).

The committee's questions focused on eligibility, selection, fund sustainability and the program's mechanics. Under the bill as presented, eligible participants must have lived outside Alaska for at least 12 months before beginning full-time employment as a certified teacher or as a state of Alaska employee, hold a postsecondary degree or certificate (from the University of Alaska or elsewhere), and be employed for a full year before receiving the annual payment. Payments would go directly to loan servicers rather than to participants.

Carrie Thomas, acting executive director of the Alaska Commission on Postsecondary Education (ACPE), told the committee ACPE would develop regulations for the pilot if it moves forward. She said the commission would decide how to prioritize applications (for example, whether to reserve parts of the pilot for teachers or other high-need state occupations) and that ACPE would likely design the pilot as a relatively simple model and then evaluate results after the three years. "In the regulations process, we would have to determine how we would handle prioritization or allocation of funds between certified teachers and state of Alaska employees," she said.

Members raised several concerns and suggestions: - Several lawmakers asked how the program would prevent short-term visits by people who return only to collect payments and then leave again. The sponsor and ACPE staff noted that payments are earned only after a full year of employment and would be paid to loan institutions; there is no provision in the draft requiring repayment if a participant leaves after receiving a payment. - Representatives asked whether the pilot would allow people who had attended out-of-state colleges under exchange programs to "double-dip" — using HEIF-funded repayment while previously benefiting from Alaska Performance Scholarship (APS) funds. ACPE said APS funds do not leave Alaska and college-choice interactions would need regulatory clarity. - Several members expressed concern about HEIF sustainability. Story and ACPE said the HEIF balance (discussed in committee materials) supports a $1 million annual draw for a limited pilot, but members urged caution because recent expansions to the WWAMI medical program and to APS have increased HEIF commitments. - Members asked whether ACPE or the Alaska Student Loan Corporation would require participants to refinance into the state loan program. ACPE said refinancing would not likely be required for the pilot but could be considered later after financial analysis.

Other operational points from the discussion: the pilot is capped at 20 participants; payments are earned on a merit-anniversary basis (after one year of qualifying service); ACPE would handle regulations and reporting, including retention analysis; and the program does not automatically protect participants who lose a job through no fault of their own from losing eligibility for future payments.

No committee vote was taken on HB 28 during the hearing. Co-chair Neil Foster set amendment deadlines for the bill and related legislation: amendments for HB 28 and HB 105 are due Tuesday, May 13, 2025, at 5 p.m. The committee will continue deliberations following the amendment deadline and any required follow-up from ACPE and legislative staff.