Opinion: The Kenai is $8 million short. The Permanent Fund is $80 billion long.
Published 1:30 am Friday, February 27, 2026
I moved to Alaska in 1957, two years before statehood. I raised nine children here. One of my daughters and her husband are retired Mat-Su Valley schoolteachers. A grandson-in-law still teaches in the district. A daughter-in-law and a granddaughter teach in the Anchorage School District. A daughter is a retired Anchorage School District employee. When schools lose funding, I am not reading about strangers. I am reading about my family.
The Kenai Peninsula Borough School District faces an $8.5 million shortfall heading into the 2026-27 school year. Superintendent Clayton Holland says the district is seeing reduced funding from both the state and the borough. A state formula shifts more fiscal responsibility to the borough as property values rise. The borough’s proposed budget provides roughly five percent less for schools than last year. The district is now proposing to close Paul Banks Elementary in Homer and Seward Middle School. Board clerk Sarah Douthit put it plainly: the district has stripped programs, stripped educators, and increased class sizes to keep buildings open. It is coming at a cost.
Last year, the Legislature approved a $700 permanent increase to the base student allocation — the first in nearly a decade. But districts remain approximately $1,283 per student below where funding would stand if the BSA had kept pace with inflation since 2011.
The math runs in one direction. Costs rise. Enrollment falls. The formula punishes districts for losing students, even when keeping schools open costs the same. On the Kenai, average home prices climbed more than $100,000 in just over a decade. Mortgage payments rose 94% between 2021 and 2024 — the steepest increase in the state, according to the Alaska Department of Labor. Young families cannot afford to stay. When they leave, enrollment drops. When enrollment drops, funding drops. When funding drops, schools close. The cycle is not slowing down.
The Permanent Fund holds more than $80 billion. A small allocation — just 10% — could provide 2% mortgages to 23,000 Alaska families. The savings: more than $330,000 per family across the life of the loan. The interest does not disappear. It returns to the Fund. Families stay. Children stay in school. Schools stay open.
Governor Jay Hammond created the Permanent Fund with a simple question. What’s the money for? His answer: it belongs to Alaskans. Forty years later, the question still stands. What’s the money for?
Evan Swensen is a prior-to-statehood Alaskan, pilot, and book publisher in Anchorage. His book, “What’s the Money For,” proposes using a portion of the Permanent Fund to provide affordable mortgages to Alaska families — keeping Alaska’s wealth in Alaska.
