School construction bill moves out of committee

JUNEAU— Five small Alaska municipal school districts are trapped between funding mechanisms for school construction, but one lawmaker proposed a bill he hopes will remedy the problem.

HB133, by Rep. Bryce Edgmon, D-Dillingham, would add Saint Mary’s, Tanana, Kake, Klawock, and Hydaburg to those districts eligible to receive funding for construction using the Regional Educational Attendance Area School Construction Fund. REAAs are small, rural school districts.

School construction currently can be funded through the capital budget using two mechanisms: The district can issue bonds — which statute says the state will reimburse 60 to 70 percent of annual bond debt — or seek resources from the REAA fund, according to Edgmon.

But the five school districts that Edgmon’s bill targets don’t qualify for the REAA fund and don’t have the resources to issue bonds.

“While most municipal districts are able to bond for school construction and subsequently access the state’s debt reimbursement program, REAA schools and schools in districts without realistic bonding capability lacked such a clear route for financing,” according to Edgmon’s sponsor statement.

Before the REAA existed, the Alaska Supreme Court found that the process by which rural schools received funding was “arbitrary and inadequate” in comparison to the process used by most municipal districts.

The REAA fund was established in 2010 to comply with the high court’s decision by paying for school construction for REAAs lacking taxable bases large enough to issue bonds.

The bill was passed out of the House Education Committee on Tuesday, and now goes before the House Finance Committee.

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Online

HB133: http://bit.ly/ZUV5gG

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