Alaska Legislature passes capital budget with a focus on school maintenance

JUNEAU — The Alaska Legislature on Friday passed this year’s capital budget, which has an emphasis on maintenance projects at K-12 schools. Other priorities include investments in renewable energy and housing.

The $4 billion capital budget funds dozens of infrastructure and maintenance projects across Alaska. Most of the funding comes from the federal government. Just over $550 million comes from the state treasury for projects chosen by Gov. Mike Dunleavy and the Legislature.

The Senate passed the capital budget Friday on a 17-2 vote. The two no votes came from Republican Sens. Mike Shower and Robb Myers, who are not members of the bipartisan Senate majority. Palmer GOP Sen. Shelley Hughes had an excused absence. The House overwhelmingly approved the capital budget on Wednesday.

The state Department of Education and Early Development submits a list of maintenance requests each year, according to priority of need. The Legislature funded the department’s top 26 projects at a cost of $62.7 million.

Lawmakers representing Western Alaska, in particular, have reported crumbling school facilities. Almost $30 million was allocated for a separate fund to help maintain schools in rural Alaska; $22 million was slated to build a replacement school in Toksook Bay.

Dillingham independent Rep. Bryce Edgmon said in an interview Friday that he was “very grateful” the Legislature chose to fund the largest number of school maintenance projects in more than a decade.

The governor can use his veto power to eliminate or reduce funding for any of the Legislature’s chosen capital projects. Edgmon, who manages the capital budget in the House, said the next step would be to convince Dunleavy that all the school maintenance funding in the capital budget should be distributed.

Dunleavy has not spoken publicly this year about the capital budget. Jeff Turner, a spokesperson for the governor’s office, said by email Friday that Dunleavy would review the bill when it arrives on his desk later this month.

The University of Alaska has an estimated $1.4 billion deferred maintenance backlog. The capital budget would allocate $28 million to fund eight maintenance projects across the university system. Planned renovations at the University of Alaska Anchorage’s Consortium Library are focused on fixing its heating and electrical systems.

Other capital budget projects include $15 million to help fund a nursing facility at the Alaska Native Tribal Health Consortium; $7.5 million to help struggling seafood processors by buying an oversupply of seafood for food banks; $7.5 million to replace the antiquated online application system for the Permanent Fund dividend; and $2.2 million for the University of Alaska Fairbanks to study the viability of coal-fired power with carbon sequestration.

With legislators reporting a dire need for housing across the state, more than $30 million was approved for new housing and residential energy-efficiency projects. The Alaska Housing Finance Corp. would be tasked with building more housing in rural Alaska for professionals, such as teachers and public safety workers.

The Legislature approved $10 million to fund home weatherization projects to create more energy-efficient homes and help reduce power costs. Bethel Democratic Sen. Lyman Hoffman said Friday that the home weatherization investment was the largest in over a decade.

A total of $14.5 million was approved by lawmakers for renewable energy projects across the state. The capital budget would fund the top eight projects submitted by the Alaska Energy Authority. Those include solar power projects in Ruby, Naknek, Kotzebue and the Kenai Peninsula.

When the price of oil crashed over a decade ago, capital budget spending dropped substantially. Since oil prices have risen again, infrastructure spending has also increased. The passage of the massive federal infrastructure bill in 2021 also saw a boost in state spending to capture more federal infrastructure investment.

The Legislature’s near-unanimous support for the capital budget is unusual compared to recent years. The re-addition of discretionary spending on projects in legislators’ home districts helped garner broad support for the spending plan, lawmakers say.