Saving money, or passing the buck?

  • Thursday, March 26, 2015 5:19pm
  • Opinion

Yes, Alaska is facing a challenging economic situation, but when it comes to addressing the budget, just where does the buck stop?

Apparently not with the Alaska Legislature.

The Senate this week approved a bill that would retroactively halt the state’s practice of partially reimbursing municipalities for school bonds issued after Jan. 1, 2015. Fast-tracking SB 64 would particularly affect the Anchorage School District, where voters are set to decide a bond issue in an April 7 election.

Under the school debt reimbursement program, the state reimburses municipalities up to 70 percent for school construction projects. According to a press release from the Senate Majority office, school debt reimbursement is just under $120 million annually and has totaled more than $3 billion since 1972. Under the measure, school debt reimbursement could resume in 5 years at a lower rate.

The Senate Majority press release went on to tout the measure as a way of taking responsibility to control expenses.

Unfortunately, the measure doesn’t do either. It simply passes the responsibility and expense back to the affected municipalities.

And it comes as a double-whammy to school districts, which already have seen funding approved by the previous Legislature cut from the budget.

The Kenai Peninsula Borough has been able to take advantage of the program in recent years, using bonds to repair and replace the roofs on schools buildings across the district. School district and borough administrations considered the project essential to maintaining valuable but aging infrastructure. Had state reimbursement not been an option, peninsula voters may have been more reluctant to approve the bond package — though residents here have always been supportive of schools — or the borough may have had to stretch the process out over several more years.

Perhaps dipping into state savings to cover improvements to Alaska’s schools isn’t the responsible thing to do in a budget crunch — though we’d argue that when it come to infrastructure maintenance, a stitch in time saves nine. Legislators were smart enough to replenish various state savings accounts when oil prices spiked a few years ago; investing in schools would seem a wise use of a portion of that savings.

Perhaps other municipalities planning to issue bonds will decide to pick up the entire tab for their projects, or perhaps they’ll decide to wait and see what happens in five years.

Either way, this measure does not demonstrate a Legislature taking responsibility by controlling debt. It just passes the buck along to someone else.

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