A student walks across the campus of the University of Alaska Southeast in this Feb. 4, 2021 file photo. An Anchorage Superior Court ruled Thursday against a group of UA students who had sued the state over funding for higher education scholarship programs. (Peter Segall / Juneau Empire file)

A student walks across the campus of the University of Alaska Southeast in this Feb. 4, 2021 file photo. An Anchorage Superior Court ruled Thursday against a group of UA students who had sued the state over funding for higher education scholarship programs. (Peter Segall / Juneau Empire file)

Students appeal Superior Court ruling on higher education funds

Funds for scholarships are ‘sweepable,’ Judge says

University of Alaska students on Friday appealed a decision from an Anchorage Superior Court judge that sided with Gov. Mike Dunleavy’s decision to subject higher education scholarship funding to a state accounting mechanism known as “the sweep,” which annually empties state accounts.

Students argued the decision to subject the Higher Education Investment Fund to the sweep violated state law. The sweep moves funds to the Constitutional Budget Reserve and requires a two-thirds majority of the Legislature to reverse, a vote recent Legislatures haven’t been able to achieve because of political divisions.

The suit stems from a decision by former Attorney General Kevin Clarkson and former Office of Management and Budget Director Donna Arduin to subject the Higher Education Investment Fund to the sweep, a position not taken by previous administrations. A similar lawsuit rejected the administration’s decision to sweep the Power Cost Equalization fund, shielding that program from legislative impasse.

In his decision, Judge Adolf Zeman said the PCE fund’s enabling language establishes it outside of the general fund. Zeman also rejected the students’ claim funds were dedicated to various scholarship programs — such as the Alaska Performance Scholarship and Washington, Wyoming, Alaska, Montana, Idaho Program at the University of Washington School of Medicine — citing a previous court decision, Hickel v. Cowper.

“Without further legislative action, the funds in the HEIF stay in the general fund. This interpretation of the HEIF follows Hickel ‘s binding definition of ‘available for appropriation,’” Zeman wrote.

[Dunleavy touts state finances, bond plan to municipal leaders]

Speaking to the Empire by phone Friday, attorney Scott Kendall said he understood and respected the court’s decision but said an appeal had been filed earlier that day.

“There is some language from a prior case, (Hickel) and I think Judge Zeman felt bound by that language,” Kendall said. “Our opinion is that the language was not binding.”

Kendall said he expected the Alaska Supreme Court to move in an expedited fashion in the case and he hopes for a better result with the higher court.

Students were financially and legally supported in their suit by Providence Alaska Hospital and the University of Alaska. UA spokesperson Roberta Graham directed questions to Kendall.

The Legislature filed an amicus brief in support of the students, with the bicameral Legislative Council voting 17-1 in favor.

Speaking to the Empire Friday Legislative Council chair Rep. Sara Hannan, D-Juneau, said she was disappointed by the decision, but appreciated the clarity from the court on the issue.

“The concern from the Legislature is that fund had been endowed over previous years,” Hannan said, allowing the earnings from the fund to cover the costs. “The governor is funding only one year of those programs.”

Hannan said the Legislature should create a fund for higher education that can assure students their full multi-year education will be funded without being subject to regular political battles.

In a news release, Alaska Department of Law communications director Aaron Sadler said the sweep has no impact on existing HEIF grants and the governor continues to make scholarship funding a budget priority.

“HEIF scholarships have been fully funded throughout the Governor’s administration, including in the fiscal 2023 budget,” Sadler said.

In his opinion Zeman said the Legislature had the power to create specific appropriations for the HEIF if it sought to do so.

“However, this is not within the Court’s power. The power of appropriation belongs solely to the Legislative Branch,” Zeman wrote. “The Court’s decision here today stems from its interpretation of legal precedent, precedent it must follow and apply.”

• Contact reporter Peter Segall at psegall@juneauempire.com. Follow him on Twitter at @SegallJnuEmpire.

More in News

(Juneau Empire file photo)
Aurora forecast through the week of Nov. 3

These forecasts are courtesy of the University of Alaska Fairbanks’ Geophysical Institute… Continue reading

Senate President Gary Stevens, R-Kodiak, speaks to members of the Senate majority caucus’ leadership group on Friday, April 12, 2024. (James Brooks/Alaska Beacon)
Education, energy and elections among priorities of Alaska Senate’s post-election agenda

Senate’s previous bipartisan majority will continue, albeit a bit smaller, after election.

A statue of William Henry Seward stands outside the Dimond Courthouse in downtown Juneau. (Clarise Larson / Juneau Empire file photo)
Juneau man gets 18-year prison sentence for sexual abuse of a minor

Craig Foster, 63, pleaded guilty to charge involving girl between 9 and 11 years old.

(Michael Penn / Juneau Empire file photo)
Police calls for Wednesday, Nov. 6, 2024

This report contains public information from law enforcement and public safety agencies.

(Michael Penn / Juneau Empire file photo)
Police calls for Tuesday, Nov. 5, 2024

This report contains public information from law enforcement and public safety agencies.

(Michael Penn / Juneau Empire file photo)
Police calls for Monday, Nov. 4, 2024

This report contains public information from law enforcement and public safety agencies.

Rep. Bryce Edgmon, I-Dillingham, speaks in favor of Senate Bill 48, the carbon credits bill, on Tuesday, May 16, 2023, in the Alaska House. At background is Department of Resources Commissioner John Boyle and staff supporting the bill. (James Brooks/Alaska Beacon)
Alaska House control flips from predominantly Republican coalition to mostly Democratic coalition

Preliminary election results show the new House majority will have at least 22 members.

West Juneau homes on Douglas Island late Thursday afternoon. (Mark Sabbatini / Juneau Empire)
What will Trump as president again and a more liberal Alaska Legislature mean for Juneau?

Election appears to shake up federal and state governments in different ways, leaving lots of unknowns.

Most Read