Valley HS funding hinges on statewide voter OK

Posted: Thursday, October 10, 2002

A new Mendenhall Valley high school could be on the horizon for Juneau if a statewide school construction and maintenance bond measure is approved by voters in the Nov. 5 general election.

For more Juneau Empire coverage of the November 5 general election, please visit the Juneau Empire Elections Guide.

The city would be reimbursed up to 70 percent of the cost of construction of the school if the measure is approved.

Also, $9 million in bonds would go toward a new University of Alaska Fairbanks fisheries laboratory at Juneau's Lena Point.

General obligation bonds totaling $236 million would go toward maintenance and construction projects for rural schools throughout the state, renovations to University of Alaska facilities and the Anchorage Museum of History and Art. The university renovations include University of Alaska Southeast satellite campuses in Sitka and Ketchikan.

More than 50 public school projects throughout the state would make up the bulk of the bonds - about $170 million or 72 percent.

Passage of the proposition would constitute the first bond package issued in Alaska in more than 20 years.

Chances that the proposition will pass are good, according to a poll by Dittman Research Corp. of Anchorage. The statewide poll conducted in late September showed 76 percent in favor of the proposition, 20 percent opposed and 3 percent undecided.

The statewide appeal of the proposition could be due to another measure passed by the Legislature tying debt reimbursement for urban school construction and maintenance projects, such as Juneau's new high school, to passage of the bond proposition. The measure would reimburse municipalities between 60 and 70 percent of school bond debt approved between 1999 and Jan. 1, 2005.

Other Southeast rural school projects in Proposition C

• $3.9 million for classroom renovation at UAS Ketchikan.

• $385,000 for classroom and parking lot renovations at UAS Ketchikan.

• $540,000 for classroom completion at UAS Sitka.

• $394,065 for Gustavus gymnasium renovation.

• $1,805,501 for maintenance to Hoonah Elementary.

• $5,822,106 for Hydaburg school renovation.

• $177,756 for Skagway school roof replacement.

• $125,801 for structural repair to Yakutat High School gymnasium.

• $138,137 for mechanical system renovations in the Chatham School District.

• $470,415 for renovations to Kake Middle School.

• $72,258 for renovations to Yakutat High School.

• $171,092 for Hoonah pool upgrades.

Eddy Jeans of the state Department of Education said the debt reimbursement bill is tied to the proposition: If the proposition fails, so does the debt reimbursement. Jeans said the state is bonding for the rural school projects because villages in Bush communities don't have the taxing authority to fund their own school construction projects.

The percentage of debt reimbursement is based on enrollment and square footage at the school, according to Carl Rose, executive director for the Association of Alaska School Boards, which backs the measure. The state also takes into consideration the level of need involved in each project, Rose said.

He said the criteria for reimbursement as well as making it onto the bond list is based on factors such as safety, unhoused students, preventative maintenance, code upgrades, efficiency and renovation.

For instance, bonding for a centralized kitchen for a school in the Mat-Su would fall under the category of efficiency and only be eligible for 60 percent reimbursement, Rose said.

He said this is a good time to bond for the projects because interest rates are low. Larry Persily of the Department of Revenue said it will cost approximately $18.4 million annually over 20 years to pay off the bonds.

Although $170 million is slated for rural public school projects in the bond proposition, Rose said, passage of the proposition would cover only 27 percent of the $650 million in backlogged projects throughout the state.

Education First, a group pushing for passage of the proposition, says bonding is essential in completing the projects because of the dwindling funds in the state's Constitutional Budget Reserve, which has been used to fund school construction projects in the past. The CBR is made up of oil and gas tax royalties paid to the state by oil companies.

Since the creation of the CBR in 1990, the state has spent $4.8 billion of the fund's $7.1 billion to fill the gap between revenue and expenditures. State officials forecast the CBR to run dry by 2004, leaving the state with a $1 billion fiscal gap.

Education First asserts that using the CBR to pay for school construction and renovation projects would accelerate the depletion of the fund.

"Yet the longer we wait to finance this work, the more expensive it will be," the group said in a press release. "In addition, low rates make this an excellent time to issue bonds."

Timothy Inklebarger can be reached at

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