House Finance Committee hears bill to smooth Alaska school funding and speed contracts

Representative Andy Story introduced House Bill 261 before the Alaska House Finance Committee on April 22, proposing changes to the state's school funding timeline so districts can know their funding earlier and make spring staffing decisions.

Story said the current schedule, anchored to an October 20-day student count, creates late certainty that forces districts to sign contracts and set local budgets before final state funding is known. "The education funding process in Alaska is broken and it needs to be fixed," Story told the committee, urging a timeline that allows districts to offer teacher and staff contracts earlier in the spring.

At the core of HB 261 is a choice for districts: use the greater of either a prior three-year average of average daily membership (ADM) or the previous fiscal year's ADM for funding calculations so districts have a reliable number by July 1. The bill also includes exceptions and adjustments: a provision lets districts use the current-year ADM if enrollment increases by more than 5 percent; it permits a February 15 adjustment for new intensive-needs students; and it allows smaller alternative schools (fewer than 175 ADM) to be counted as separate sites for school-size multipliers.

Supporters representing small and regional districts told the committee those changes would reduce disruptive midyear funding swings. "The committee substitute allows districts that are currently in hold harmless or that qualify by 07/01/2026 to continue using the existing hold harmless formula until they are no longer eligible," said Michael Robbins, superintendent of the Bristol Bay Borough School District, describing the transition language as important for small, rural districts that cannot absorb sudden enrollment shifts.

Clayton Holland, superintendent of the Kenai Peninsula Borough School District, said the bill's predictability would help districts hire and offer contracts earlier, reducing the risk of losing candidates. Katie Parrott, president of the Alaska Association of School Business Officials, told lawmakers the current process requires repeated budget revisions and significant administrative time; she said smoothing inputs would let districts focus more on students and less on repeated financial reworking.

Committee members pressed on technical details. Representative Sal asked about potential double-counting or transfer effects when intensive-needs students move between districts; Story said districts would only use the February adjustment if they had more intensive students and that existing contracts and service obligations limit immediate reallocation. Representative Bynum sought district-level modeling and noted the fiscal note figure she read as an additional $113,000,000 (she characterized that as roughly equivalent to about a $450 increase in the base student allocation), asking staff for full modeling for every district before further action.

Story told the committee Legislative Finance staff member Lori Weed prepared the district calculations and offered to provide more examples and bring back technical experts, including Justin Silverstein, who helped author the 2015 review of Alaska's school funding program. No formal motion or vote occurred; the committee scheduled follow-up work and reconvened later in the day on unrelated items.

The committee recessed after asking staff to supply the requested district-level modeling and fiscal detail; HB 261 will return for further consideration once members have had time to review the modeling and answers to intensive-needs and school-size multiplier questions.