ANCHORAGE — Alaska’s education system stands as a testament to resilience. At a recent forum hosted by Commonwealth North, five superintendents from districts large and small laid bare the triumphs of their classrooms against a backdrop of fiscal cliffs and shifting student needs. Moderated by Kai Binkley-Sims, vice chair of Commonwealth North, the panel included Dr. Jharrett Bryantt of the Anchorage School District; Clayton Holland of the Kenai Peninsula Borough School District; Dr. Luke Meinert of the Fairbanks North Star Borough School District; Dr. Madeline Aguillard of the Kuspuk School District; and Dr. Jason Johnson of the Galena City School District. Though representing different parts of Alaska, each superintendent shared a commitment and a passion for student outcomes. The discussion drew a crowd of teachers, policymakers, and concerned parents.
Sponsored by the Alaska Superintendents Association
For all the fiscal headwinds, Alaska’s schools are churning out successes that rival urban powerhouses — proof, educators say, that investment yields returns when it lands in the right hands.
In Anchorage, the state’s largest district with 41,700 students, Dr. Bryantt touted a “strong start” to the 2025-26 year, despite summer vetoes. 100% of the released $14 million funding went into the classroom. They began hiring20 new teacher positions within 72 hours. Bryantt touted double-digit literacy leaps: 10 percent gains in kindergarten and first-grade screeners over two consecutive years, including a staggering 21 percent jump at Kasuun Elementary, long one of the system’s lowest performers. Advanced Placement enrollment has swelled by 700 students since Bryantt’s arrival, with passing rates soaring to 89 percent at Eagle River High School — up from 55 percent in 2021. Math, too, is on the mend: Eighth-graders posted a 5 percent improvement on state assessments, one of the strongest in Alaska. Graduation rates ticked up 2 percentage points districtwide, hitting 94 percent for career-technical education (CTE) participants after the addition of 26 new pathways. “We’re within arm’s reach of 90 percent for all students,” Bryantt said, envisioning “thousands” entering college or the workforce equipped for success. Anchorage has seen an influx of 170 students displaced by Typhoon Ha-Long in Western Alaska. “Those students are traumatized… They’ve lost everything,” Bryantt said. “It’s going to take years to build them back up.” The community rallied — outfitting kids with Halloween costumes and food in a city where basics are hard to source. “We have more students with needs than we’ve ever seen before,” he added.
Down in the Kenai Peninsula, where Clayton Holland oversees 43 schools across an area the size of West Virginia, the metrics shine brighter still. The district outperforms national norms on literacy and math growth assessments, boasts an 82 percent AP pass rate (beating global averages) and counts three alumni bound for MIT and five for military academies. Graduation rates have rebounded to pre-pandemic highs, with a 90 percent target in sight, fueled by CTE expansions like energy camps and healthcare intensives offering dual credits and certifications.
Fairbanks North Star, with 11,197 students across 28 schools, marked steady literacy climbs: 66 percent of K-3 students proficient on spring 2025 mCLASS, up 3 points and surpassing goals; 60 percent in grades 3-9 on MAP assessments, another 3-point gain. Graduation soared to a record 82.6 percent, with special education up 26.7 points and Alaska Native students gaining 8.8 points. Lathrop High jumped 16 points to 79.9 percent. Algebra passing rates rose 10 percent in the first semester.
In rural Galena City, Dr. Jason Johnson celebrated “skyrocketing” K-6 literacy at Sidney Huntington Schools alongside CTE triumphs like aviation solos, a State Board of Education award for student learning and Yukon River-based programs teaching snow machine repair and subsistence fishing at the Galena Interior Learning Academy (GILA). Johnson also highlighted the successes of special education students in IDEA’s homeschool program.
Kuspuk, a remote expanse of eight schools in seven air- or river-only villages, serves 96 percent Alaska Native students (Yup’ik and Athabascan) amid the state’s highest child poverty rate. Dr. Aguillard’s “Calillgutekluta Ciutmurrnaurtukut” — “Let’s go forward, working together” — framed triumphs in cultural unity, serving 1,391 residents across 12,000 square miles from Lower Kalskag to Stony River. Kuspuk weaves Yup’ik/Athabascan heritage into forward momentum. Graduation rates are trending upward, even with classes as small as one — as at Crow Village Sam School, where a lone senior crossed the stage last year in a “wonderful event.” Unique place-based programs, sustained since 2005 through grants and donors, immerse students in river life: two-week expeditions teaching survival skills and a shorter eight-day George River Internship, complete with stipends and fly-in drop-offs at gravel bars or dirt strips. Applications triple capacity, limited only by adult chaperones willing to brave the wilderness with dozens of teens. “These experiences on the river… are going to carry them through life,” Aguillard said.
These wins, panelists agreed, stem not from mandates but from educators’ grit: “The Reads Act has been successful… because of the educators in the classroom,” Holland noted.
BSA Amount vs. BSA Adjusted for Cost of Living & Inflation
Alaska’s K-12 spending often draws national scrutiny — clocking in at about $22,600 per student. Yet the figure is a mirage, inflated by the state’s unique geography and unadjusted for the soaring costs of delivering education in a place where fuel prices can double overnight and teachers may need planes to reach their classrooms.
An independent cost-of-living study (ISER) ranks Alaska 10th in raw dollars but below the national average when adjusted for expenses. A district “pencil graph” reveals a $700 shortfall per student since 2011, as costs outpace allocations. Anchorage lags 14 percent behind the U.S. average, a gap widening since 2022 when four more states surged ahead in per-pupil investment.
The BSA — Alaska’s foundational per-student funding — has barely budged in a decade. Since 2017, school district budgets have risen 8.5 percent, even as every other state department ballooned by 36 percent on average — including a 55 percent surge for the Department of Corrections.
If The BSA had kept pace with inflation, that figure would have climbed steadily: $7,612 by FY24, $7,787 by FY25, $7,943 by FY26. Instead, the actual BSA languished at $5,930 through FY24, ticking up modestly to $5,960 in FY25 before the bipartisan legislative overrides of summer 2025 pushed it to $6,660 for FY26 and FY27 — still $1,442 short of what inflation demands today, and a yawning $2,172 gap from the 1980s’ adjusted equivalent when teacher pay topped national averages by 75 percent and pensions were the envy of the union.
Skeptics often point to administrative “bloat” as the villain. But the numbers, laid bare in Bryantt’s FY26 budget breakdown for Anchorage’s $644 million operation, puncture that myth. Districtwide administration — encompassing the superintendent, chief officers, payroll, HR, IT, risk management, and communications — claims just 5.3 percent, or $34.5 million, down from 5.7 percent the prior year. Direct classroom instruction devours 59.5 percent ($383 million), student supports 22.5 percent ($145 million), and operations/maintenance 12.7 percent ($82 million). “Cut all the administrators out,” Bryantt might counter, and you’d scrape together perhaps 5 percent of the budget — a drop that wouldn’t dent the inflation gap. Even then, districts would still lack $1,442 per student annually to reach FY26’s inflation-proofed BSA of $7,943. Statewide, DEED’s K-12 allocation rose only 12 percent since FY17, trailing inflation by hundreds of millions. “Stability builds trust and strengthens stewardship,” Bryantt’s slides proclaimed. “Predictable funding drives smarter decisions and stronger outcomes. When schools can plan ahead, every dollar goes further.” Almost every year since 2016, districts have been threatened by funding cuts leading to an unstable working environment for teachers threatened by furloughs and layoffs.
Rural distortions amplify the pain. In places like Kuspuk’s riverine outposts, gas prices have doubled and utilities jumped 33 percent, stretching federal benefits like SNAP and Medicaid to their limits. Up to 60 percent of its operational budget derives from grants — federal and state — a lifeline that’s fraying as applications dwindle and awards are pulled. This summer’s federal funding pause nearly derailed core programs, forcing frantic encumbrance of already-spent dollars. “There’s not as many applications, there’s grants being pulled,” Aguillard said. “That’s one of the things that really is on our mind.”
Changing Demographics: Trauma and Transition
Alaska’s classrooms are evolving, but not always for the easier. Statewide, enrollment is dipping: Fairbanks has shed 500 to 600 students, 70 percent due to out-migration rather than homeschooling or charters. Birth rates are falling, with more high school graduates than kindergartners entering annually. Special education caseloads leaped 21 percent in 10 years, 28.5 percent post-COVID, per Fairbanks — amid nationwide shortages.
Homeschooling, while a “positive choice” for many families, raises alarms as it siphons resources from brick-and-mortar schools. “It is a concern for all of us as we have kids shift,” Holland said. Alaska has the highest rate of homeschool in the country at 17% compared to the national average of 6%.
Infrastructure & Transportation
From unbudgeted 27 percent spikes in electricity rates crippling rural operations to the closure of seven Fairbanks schools, infrastructure woes compound funding squeezes. In Galena, facilities are “falling apart” — second on the state’s maintenance backlog — plagued by mishaps like indoor waterfalls from leaky roofs. Food service costs ballooned $300,000 after U.S. Postal Service bypass mail cuts, forcing districts to scramble for alternatives.
High school class sizes in Fairbanks have swelled by 10 students, slashing course options and eroding gifted programs. Staff cuts — 25 percent in administration, 360 jobs overall — have left some SPED classes starting the school year with uncertified educators. “We’re hodgepodging this whole thing,” Holland lamented of lost librarians, arts and music programs. “And I keep going back to imagine what we could do if we had that funding, what other opportunities would we be able to offer our kids?”
(FAIRBANKS SLIDE ON REDUCTIONS)
Kuspuk’s fixed costs paint a dire picture: Property insurance has tripled for buildings the district doesn’t even own, leaving it in a bind — unaffordable premiums yet insufficient coverage for a catastrophic rebuild. Fuel, barged upriver, is at the mercy of volatile markets, while utilities in Aniak once quadrupled to “some of the highest electrical rates in the world.” Now, four more communities face 27 percent hikes effective this month, blindsiding budgets via a late public notice. “We didn’t budget for that,” Aguillard said. “How do we keep the lights on in these buildings?”
(KUSPUK SLIDE ON OPERATIONAL COSTS)
Correspondence programs, vital for remote families, receive zero additional fiscal support for special education students like their peers in brick-mortar schools. “You’re depriving them of the things they need, and at the same time, you’re taking away from other students’ access,” Johnson said. Johnson also highlighted the disparity in support for residential schools as the only public schools in Alaska that had a funding reduction.
NAEP vs. STAR: Why National Scores Miss Alaska’s Mark
The National Assessment of Educational Progress (NAEP) often paints Alaska dim, but panelists called foul—it’s a blindfolded sprint on someone else’s track. “No one has actually seen the NAEP,” Johnson explained. It’s a random sample test, sprung on select grades and schools, with zero prep or familiarity. Worse, Alaska’s standards don’t align to it; districts teach to state goals, not this national yardstick. Enter STAR (Alaska’s state assessment): It mirrors what kids learn daily, offering a truer pulse on progress. “If we want to measure, why aren’t we measuring on Alaska standards?” echoed Aguillard, a Louisiana-transplant. STAR reveals gains—like Anchorage’s 5% math proficiency jump or Kenai’s above-state reading growth—that NAEP obscures. As Meinert put it, national optics distract from local truths: We’re climbing, just not always on their ladder.
Growth data tells a truer story: Incremental literacy gains under the Reads Act, from the bottom 5th percentile toward the 80th. Yet math lags, demanding a renewed focus.
Mississippi’s education turnaround is the stuff of headlines: dramatic NAEP gains after years of laser-focused investment. But as panelists like Aguillard dissected, it’s no plug-and-play for Alaska’s rugged realities. Mississippi poured eight full years into aligning every layer—from classrooms to state tests—to the NAEP framework, a deliberate, sustained bet before results bloomed. Alaska? “We had the Reads Act—I don’t mind it, I’m in favor,” Meinert said, “but we went right to the next thing: charters.” Initiatives flip too fast, diluting impact. Plus, Mississippi’s denser, more connected geography eases logistics; Alaska’s vastness—from Kuspuk’s 12,000 square miles of river-and-air-only villages to Galena’s remote academies—demands tailored strategies, not borrowed blueprints. “They invested full-on before seeing change,” Aguillard noted. For Alaskans, the lesson isn’t envy—it’s endurance: Commit deep, stay the course.
Recommendations: A Call for Sustained Vision
Superintendents didn’t just diagnose; they prescribed. A “Math Act” — modeled on Reads but fully funded — topped Meinert’s list: “Let’s invest in success, because we know it’s going to be successful with good policy.”
Bryantt demurred, prioritizing teacher recruitment via defined-benefit pensions or Social Security — absent in Alaska, the only state without them. “These are literally the people that can do the math on their annuities,” he said, drawing applause.
Extra dollars? Slash class sizes through recurring hires (total cost: $120,000 per teacher with benefits), restore arts and regional CTE hubs, and bolster underfunded SPED in correspondence and residential programs. Update the BSA’s district cost factor — Anchorage’s baseline is obsolete; Mat-Su gets 10 percent more despite lower costs now.
Aguillard echoed the push for growth metrics over point-in-time tests, urging sustained grant stability to protect cultural programs. “Growth doesn’t happen overnight,” she said. “But one of the pieces that you can really see… is that heavy focus on reading and early literacy skills is paying off.”
Above all, stability: “We don’t just need more funding, we need predictability,” Bryantt urged. Like Mississippi’s “miracle” — which took eight years of aligned standards, training and lower classes — Alaska requires a unified vision, adjusted for its extremes. “It’s intellectually dishonest” to transplant that template wholesale, Bryantt said. “This is one of the most expensive places on Earth.”
As the forum closed with a standing ovation for educators — “If we are going to make one investment in our future, it is in our kids,” said host Ross Johnston — the superintendents left no doubt: Alaska’s schools aren’t broken. They’re starved. With legislators convening soon, the question lingers: Will the state feed the system that feeds its future?
Anchorage, AK – November 6, 2025 – In a powerful display of Alaskan solidarity, Commonwealth North’s annual Hickel & Egan Awards Gala transformed into an impromptu fundraising triumph on October 23, raising $36,000 in minutes to support families devastated by Typhoon Halong in Western Alaska. The funds were presented today to the Bethel Community Services Foundation, ensuring direct aid reaches those in need.
During the gala at the Anchorage Museum, honoree John Binkley, business man and former Bethel Senator, was delivering a heartfelt appeal for support to Western Alaska residents still reeling from the typhoon’s destruction when Joe Balash, Executive at Santos, called out from the audience: “Paddle Raise!” Emcee and board member Moira Smith swiftly seized the moment, launching a rapid-fire bidding session that galvanized the room.
Nearly two-thirds of the 150 attendees contributed, with Northrim Bank business development officer Bill Bailey pledging an initial $14,000 matching gift from Northrim Bank. Additional commitments of $5,000 each came from the Binkley family, Santos, and John Shively propelling the total to $36,000.
“This was Alaskans stepping up for Alaska at its finest,” said Ross Johnston, Executive Director of Commonwealth North. “And it shows how one person’s timely nudge—thank you, Joe—can spark a wave of generosity that makes a real difference.” John Binkley agreed, “I believe former Governors Hickel and Egan, for whom the event honors would be proud of the spirit demonstrated during the event.”
Yesterday, November 5, Johnston presented the check to Fannie Black, a board member of the Bethel Community Services Foundation, in the Northrim Bank lobby in Anchorage. Joining the presentation were Northrim’s Jason Criqui and Kari Skinner, alongside Shively, Binkley, and Balash.
Fannie Black shared a personal connection to the crisis. “This support means everything to our community,” Black said. “My family has been deeply affected—my uncle is among those still missing after the typhoon. So many families remain displaced, and this $36,000 will go straight to them for immediate needs like shelter, food, and rebuilding. On behalf of everyone in Bethel and beyond, thank you for seeing us and stepping up.”
The Commonwealth North Hickel and Egan Awards gala honored John Binkley and Gloria O’Neill, CEO of Cook Inlet Tribal Council, for their lifelong dedication to Alaskan leadership and community building. Commonwealth North’s event underscored the organization’s mission to foster nonpartisan dialogue and action on issues vital to Alaska’s future.
About Commonwealth North
Commonwealth North is a nonpartisan leadership organization dedicated to building a stronger Alaska through informed dialogue, strategic partnerships, and actionable solutions. For more information, visitwww.commonwealthnorth.org.
John Binkley calling out numbers as Moira Smith frantically writes down the pledges at the Commonwealth North Hickel & Egan Awards Gala on Oct 23, 2025 at the Anchorage Museum.
Nearly 2/3rds of the room showing their support by pledging money to Western Alaska Residents at the Commonwealth North Hickel & Egan Awards Gala on Oct 23, 2025 at the Anchorage Museum.
Convening in the Northrim Bank Lobby on November 5th, 2025 Noon.
From left to right: Joe Balash (Santos), John Shively (Resource Development), John Binkley (Business Man & Former Legislator), Fannie Black (Bethel Community Services Foundation), Jason Criqui (Northrim Bank), Ross Johnston (Commonwealth North), Kari Skinner (Northrim Bank)
Writing the Commonwealth North check to the Bethel Community Services Foundation.
From left to right, John Binkley (Business Man & Former Legislator), Fannie Black (Bethel Community Services Foundation), Jason Criqui (Northrim Bank),Joe Balash (Santos), John Shively (Resource Development), Ross Johnston (Commonwealth North)
Can a New Pension Plan Stem Alaska’s Talent Exodus?
Forum Summary by Ross Johnston, Executive Director.
Stay informed with the latest briefs by signing up for our email list. A roomful of policymakers, constituents, economists, educators and public servants grappled with a ghost from Alaska’s past: reviving a once-robust pension system. The stakes couldn’t be higher. With state agencies bleeding talent — troopers commuting from Florida, rural classrooms staffed by visa holders from the Philippines — a proposed overhaul to the retirement system has ignited a fierce debate. Is House Bill 78 the lifeline Alaska needs to keep its workers, or a risky rewind to fiscal folly?
The forum, hosted by the nonprofit policy group Commonwealth North, brought together a bipartisan panel to dissect HB 78, a House Finance Committee bill that would introduce a new defined benefit pension plan for state employees. Modeled after systems in states like Washington and Wisconsin, it promises shared risks between employers, employees and retirees, capped contributions and no automatic cost-of-living adjustments if funding dips below 90 percent. Proponents hail it as a bulwark against the “high tax of turnover,” while critics warn it’s a Pandora’s box of unmodeled uncertainties.
Representative Chuck Kopp, a Republican from Anchorage and a retired police officer, kicked off the discussion with a stark diagnosis. “Every year, when the governor rolls out his annual budget, all the commissioners list their top concern: recruitment and retention,” Kopp said, flashing charts showing overtime costs ballooning from $85 million in fiscal year 2020 to a projected $160 million by 2025. He traced the woes back to 2002, when actuarial firm Mercer — later sued by the state — underestimated contributions, saddling Alaska with a $6 billion liability in today’s dollars.
HB 78, Kopp argued, flips the script. New hires would default into the plan, with existing employees given 180 days to opt in from the current defined contribution model, akin to a 401(k). Employee contributions would range from 8 to 12 percent of payroll, matched by employer flexibility, and vesting after five years. Actuaries, he stressed, project a flat $37 million annual state cost with no new unfunded liabilities. “This is a strategic investment in the workforce,” Kopp said, citing surveys where 83 percent of Department of Public Safety members favored a defined benefit return. “We’re not taking away from the old system. But going forward, everybody has skin in the game.”
Not everyone was convinced. Representative Will Stapp, a Republican from Fairbanks and a combat veteran, countered with a plea for caution, invoking Warren Buffett: “Risk comes from not knowing what you’re doing.” Stapp dissected the bill’s assumptions, like the 7.25 percent discount rate for future benefits — higher than the national average of 6.86 percent and those in model states like Utah and Tennessee. “If that rate drops after employees buy in, you immediately create a liability,” he warned, projecting potential costs swelling to $1.8 billion over 20 years under modest payroll growth tweaks.
Drawing from a 2005 Senate Finance transcript, Stapp referenced the growth in total accrued pension liabilities from $12.6 billion in 2005 to $25 billion today, while noting the unfunded actuarial liability remains at $7.2 billion—down from peaks of $12-14 billion in 2014 and projected to reach full funding by 2039. “Better benefits cost more money,” he said, urging stress tests and alternatives like enhancing defined contribution matches or opting into Social Security. “We’ve repeated mistakes. If we’re wrong, retirees could go 20 years without inflation adjustments. Who pays the price? My kids, yours — all of us.”
Dr. Brock Wilson, a researcher at the University of Alaska Anchorage’s Institute of Social and Economic Research, contributed empirical evidence to the debate. He started off by showing Alaska had the highest level of school job vacancies in the country. His analysis of the 2006–2007 shift from defined-benefit to defined-contribution retirement plans found no immediate decline in recruitment, suggesting that both systems can attract new employees. However, his data show a steady erosion in long-term retention: among cohorts hired in 2000, 50 percent of employees remained after nine years, compared with just 33 percent of those hired in 2014. “Better compensation in the form of pensions leads to people sticking around,” Wilson said, citing a federal policy that increased Alaska teachers’ pensions by 25 percent and sharply reduced quit rates.
Anecdotes from Justin Mack, chair of the Alaska Professional Firefighters Association, humanized the crisis. Hired under the “Tier IV” defined contribution system 14 years ago, Mack shared stories of classes hemorrhaging talent: one lost 10 of its members to early exits, another 12. “We’re a training ground for the rest of the country,” he said. “We train them, they take.” Mack quoted firefighters who’d fled for Washington’s fully funded plan, where employee contributions hover at 8 percent and benefits have risen despite market storms. “Fiscal responsibility or retirement security? It’s a false choice.”
In a lively Q&A moderated by Jon Katchen, a partner at the law firm Holland & Hart, the panel traded barbs and olive branches. Kopp dismissed Stapp’s modeling gaps as “emotional rhetoric,” insisting actuaries had vetted the bill for 18 years across states. “They can’t envision a scenario where it introduces liability,” he said. Stapp fired back: “If it’s bulletproof, uncap employee contributions.” Mack pressed on healthcare — HB 78’s 3 percent health reimbursement accounts pale against legacy full coverage — while Wilson advocated contextual tweaks, noting salary as the top retention gripe.
Kopp expressed optimism for Stapp’s support: “He’s getting very close.” Stapp, ever the skeptic, quipped that proper comparisons might sway him: “If it makes sense, let’s do it.” As the forum wrapped, Ross Johnston, Commonwealth North’s executive director, reminded attendees: “Connection is where action happens.”
Alaska’s pension woes are no outlier. Nationally, public plans face $1.3 trillion in unfunded liabilities, per the National Conference on Public Employee Retirement Systems. But in a state where geography and isolation amplify every shortfall, the debate feels existential. With HB 78 now in the Senate, the clock ticks. Will Alaska bet on a shared-risk revival, or heed the ghosts of projections past? For workers like Mack’s firefighters — risking life and limb — the answer can’t come soon enough.
Alaska’s Fiscal Rollercoaster: From Deep Deficits to Razor Thin Surpluses
Imagine a state blessed with endless natural resources—vast oil fields, pristine wilderness drawing millions of tourists, and a sovereign wealth fund that’s the envy of the nation. Alaska boasts the seventh-highest GDP per capita and ranks third in households earning over $100,000. It’s the lowest-tax-burden state (4.6% effective rate), allowing residents to keep more in their pockets compared to high-tax states like New York (15.4%). Now picture that same state teetering on the edge of financial uncertainty, where boom-and-bust cycles have left policymakers scrambling for stability. This is Alaska in 2025, a land of abundance grappling with a “poor mindset,” as highlighted in a Commonwealth North Fiscal Policy Workshop.
A History of Fiscal Turbulence
Alaska’s budget woes aren’t new—they’re baked into the state’s DNA, heavily reliant on oil revenues that swing wildly with global markets. Alexei Painter, Legislative Fiscal Analyst for the Alaska Legislative Finance Division, gave a presentation that spotlighted the stark contrast between the mid-2010s and today. From FY15 to FY18, the state averaged staggering annual deficits of $3.2 billion, triggered by plummeting oil prices and a lack of structural safeguards. “Oil price volatility largely played out in the capital budget,” Painter noted, explaining how these shortfalls forced deep cuts and deferred maintenance on everything from roads to schools. This era of red ink was a wake-up call.
The tide began to turn in FY19 with the adoption of the Percent of Market Value (POMV) draw rule for the Permanent Fund. This mechanism allows for a predictable annual withdrawal—around 5% of the fund’s market value—providing a steady revenue stream without depleting the principal. Painter credited POMV with helping stabilize budgets, transforming deficits into surpluses averaging $69.7 million from FY21 to FY26. Oil, once dominating 30-50% of the budget, now contributes just 13%, supplanted by investment earnings and federal dollars. Adding to this stability was an unlikely ally: political gridlock over the Constitutional Budget Reserve (CBR). Since FY21, disputes over accessing this rainy-day fund have curbed excessive spending, keeping agency operations in check.
Volatility remains a challenge. The 2022 session, buoyed by high oil prices after Russia’s invasion of Ukraine, saw a $700 million capital budget, including $375 million for Anchorage and Nome ports, and a PFD plus energy relief check of $3,284. In contrast, the 2025 session, with lower oil price expectations, allocated just $160 million for capital projects and a record-low PFD of $1,000 in real terms. “It’s come at the cost of quite a bit of volatility in our budget and lack of certainty,” Painter remarked.
Painter’s fiscal summary for FY25-26 revealed a leaner state government. Agency operations in FY26, at $4.738 billion, are 4.9% higher than FY15 in nominal terms but 17% lower when adjusted for inflation. The FY26 budget totals $5.999 billion, a 5.3% decrease from FY25, yielding a post-transfer surplus of $130.4 million. This buffer, as legislative leaders call it, guards against oil price swings. “For every dollar change in the price of oil, that’s about $35 million in revenue,” Painter noted, referencing the spring forecast of $68 per barrel, but several potential supplemental needs or other increases should be considered:
The State failed the FY26 federal K-12 disparity test and is currently in an appeals process. If the failure stands, the existing appropriation for K-12 will go up by $78.9 million.
The Governor vetoed $62.1 million of reappropriations to the Department of Transportation for federal program match. To ensure that federal program match is fully funded, that amount may need to be replaced with general funds.
The Governor issued a disaster declaration on August 8 for fire suppression that estimated the need for an additional $30.0 million in general funds for the remainder of the fire season.
These three items total $171.0 million, which exceeds the currently projected FY26 surplus. In addition, there are several areas where supplementals are possible, but the need is uncertain at this point.
Costs are up for education, operations, salaries, SNAP, healthcare, and deferred maintenance. Education spending suffers from funding uncertainty since 2016, leading to teacher shortages and high turnover. Infrastructure backlogs persist with deferred maintenance estimated at $2.2 billion for state buildings and an additional $650 million for school buildings. Broader economic pressures compound these issues. Federal policy changes under the current administration are reshaping the outlook highlighting shifts in spending that could either bolster or strain the state.
The Path Forward: A Call for Non-Partisan Fiscal Certainty
Alaska’s story is one of triumph over adversity, but sustainability demands more than luck with oil prices or federal largesse. Painter’s briefing underscores the need for a Plan B: diversifying revenues, while addressing inefficiencies in education and infrastructure.
Ultimately, the solution lies in transcending partisan divides. A non-partisan fiscal policy—rooted in data, collaboration, and long-term vision—could forge a sustainable budget that leverages Alaska’s abundance. Imagine a framework where POMV draws are protected, CBR access is streamlined yet safeguarded, and new revenues fund priorities without burdening residents.
On a crisp day in Anchorage (Tue Aug 26 2025) at the UAA/APU Consortium Library, Commonwealth North brought together diverse voices to tackle one of Alaska’s most pressing challenges: crafting a sustainable fiscal plan for the next five years. Five groups worked on and presented bold, distinct visions for Alaska’s economic future, each balancing priorities like education, infrastructure, and the Permanent Fund Dividend (PFD) while grappling with revenue generation and political feasibility. While their approaches varied, common themes emerged—education, infrastructure, and coalition-building—as did a shared recognition that Alaska’s fiscal path requires tough choices and public buy-in.
The Workshop Methodology
The 4-hour workshop brought together legislators, economists, policy experts, and community members to collaboratively design fiscal policies addressing Alaska’s immediate and long-term economic challenges. Under Chatham House Rules, participants worked in small groups (5–7 members) to articulate a 5-year vision for Alaska, select key investments (e.g., education, infrastructure, housing), and balance budgets using a simplified fiscal model. Guided by facilitators and economists, groups crafted actionable proposals, which were presented and refined during a working lunch. The session concluded with a synthesis of key ideas, setting the stage for a public report to inform legislators and broader policy discussions.
Infrastructure emerged as a non-negotiable priority, with proposals to significantly boost capital budgets to tackle deferred maintenance, modernize energy systems, and enhance transportation networks like the Alaska Marine Highway System. Suggested capital investments ranged from 250 million to 650 million annually, reflecting the urgency of repairing aging facilities and building a 21st-century energy framework to drive economic growth. Bonding was floated as a creative way to leverage funds, stretching dollars further without immediate tax hikes. However, these ambitious plans face challenges, including public skepticism about large-scale spending and the need to ensure projects are sustainable, not just quick fixes. A disciplined approach, such as tying capital spending to a percentage of state facility values, could provide transparency and accountability.
Education
A cornerstone of fiscal stability is a robust education system, seen as essential for preparing Alaska’s workforce and fostering community resilience. No group recommended cuts to education. Proposed solutions varied include increasing K–12 funding to match inflation, ensuring schools keep pace with rising costs, and expanding access to pre-K programs to give children an early start. Groups in favor of these investments stated that they aimed to retain families and attract new residents, supporting long-term population growth. For instance, adjusting the K–12 funding formula to reflect inflation since 2011 was a recurring idea, as was allocating funds to address educational disparities in rural areas. By prioritizing education, Alaska can build human capital, but implementing these increases requires careful budgeting to avoid overextending resources, especially given competing priorities like infrastructure.
Reforming the PFD to Balance Priorities
The Permanent Fund Dividend, a cherished Alaskan tradition, was at the heart of fiscal discussions, with proposals ranging from modest reductions to temporary suspensions. One approach suggested capping the PFD at a fixed amount, such as $500 or $1,000, to free up hundreds of millions for education and infrastructure while preserving some resident benefit. Another idea proposed a percentage-based split, like 75% for state services and 25% for dividends, to create a predictable formula. A bolder suggestion was a PFD “holiday”—a near-zero payout for a limited period—to prioritize critical investments, with flexibility to restore dividends if surpluses emerge. These reforms aim to reduce reliance on volatile oil revenues, but they risk public backlash. Transparent communication about trade-offs will be essential to gain support.
Diversifying Revenue to Reduce Volatility
To break Alaska’s dependence on unpredictable oil royalties, revenue sources were a focal point. A state income tax, ranging from 2.5–3% of adjusted gross income, was also suggested to capture revenue from higher earners while potentially offering tax credits to offset federal liabilities. One group’s fiscal solution for a sustainable budget was to pass a zero payout dividend holiday thereby balancing the budget without new revenue. Business-focused taxes, such as those targeting S-corporations or digital enterprises, were seen as low-hanging fruit, especially since some have already passed legislative hurdles. A motor fuel tax increase was another idea to fund infrastructure. These measures could generate hundreds of millions to over a billion dollars annually, but they face resistance from businesses wary of administrative costs and tourism sectors concerned about economic impacts. Community revenue sharing, redirecting 20–25% of new taxes to municipalities, was proposed to ease local burdens and build support.
Ensuring Budget Sustainability with Guardrails
Achieving a balanced budget was a shared goal, with strategies emphasizing fiscal discipline and predictability. Proposals included spending caps tied to population growth and inflation (e.g., a 3% annual increase if population grows 0.5% and CPI rises 2.5%), ensuring expenditures align with economic realities. Building emergency buffers, ranging from $100–200 million, was suggested to handle unforeseen costs like wildfires or flooding, avoiding supplemental budget shortfalls. Some plans projected surpluses of $200–250 million, while others accepted small deficits to maintain higher PFDs, reflecting trade-offs between resident support and fiscal conservatism. Rebuilding the constitutional budget reserve and enforcing strict rules for emergency spending were seen as ways to safeguard long-term stability. Public relations campaigns to educate Alaskans about budget mechanics were deemed critical to overcome resistance and foster consensus.
Overcoming Challenges Through Coalition-Building
The workshop highlighted a universal truth: fiscal stability requires broad coalitions and public buy-in. Resistance is expected from PFD advocates, businesses facing new tax burdens, and tourism sectors wary of sales taxes impacting $3.9 billion in annual visitor spending. To counter this, participants emphasized engaging community leaders, elected officials, and citizens through forums like Commonwealth North. A compelling vision—whether making Alaska the best place to raise a family or securing high-paying jobs—must drive these efforts, not just dry budget numbers. Paid advocacy campaigns were proposed to explain trade-offs, such as how a reduced PFD could fund schools or infrastructure, ensuring Alaskans see the tangible benefits of reform.
A Path Forward
Alaska’s fiscal future hinges on blending these realistic solutions—education investment, infrastructure modernization, PFD reform, revenue diversification, and disciplined budgeting—into a cohesive plan. By prioritizing coalition-building and public engagement, the state can navigate political hurdles and build consensus around a shared vision. The workshop’s proposals offer a practical starting point: fund schools to empower future , repair infrastructure to drive growth, reform the PFD to balance resident needs with state priorities, and diversify revenue to weather economic volatility. With commitment and collaboration, Alaska can forge a stable, prosperous future that honors its unique character while embracing necessary change.
Energy Forum Summary By Ross Johnston, Executive Director.
Venue
Denali Towers North
Address
2550 Denali St, 16th FloorAnchorageAK99503,US
Starts
Tue May 20 2025, 4pm AKDT
Sponsored By
Enstar Natural Gas Company
Cook Inlet’s natural gas, the lifeblood of Southcentral Alaska’s electricity and heating, is nearing an inflection point—one marked not by the exhaustion of geology, but by economics, policy stasis, and technological reckoning.
At our recent energy forum titled Energy on the Edge: Future of Cook Inlet Gas, state officials, utility executives, economists, and industry leaders gathered in Anchorage to confront a future that is arriving faster than anyone would like. The meeting was both somber and spirited—part clarion call, part therapy session.
The unifying anxiety was simple: where will the gas come from next?
The Premises of Precarity
Dr. Brett Watson of the University of Alaska’s Institute of Social and Economic Research (ISER) opened with a gentle but unsparing economic framework. Behind the policy debates and production forecasts lies a simple, stubborn number: 70 billion cubic feet. That is the annual volume of natural gas required to keep Southcentral Alaska running. It is not an abstraction—it’s a ledger of necessity. Alaska is profoundly dependent on natural gas: it heats half the homes in the state, powers 70% of the electricity in Southcentral, and supports myriad industrial and commercial needs. And nearly all of that gas comes from Cook Inlet.
There’s still gas in the ground—perhaps trillions of cubic feet—but extracting it is increasingly uneconomical without new technology, infrastructure, or policy change. Because of rising extraction costs, particularly in the next 5-10 years, Cook Inlet gas faces what Watson and other resource economists call economic depletion. A 2018 DNR study forecast that even conservative demand scenarios will soon outstrip economically viable production, especially as costs per unit rise and producers face structural disincentives to invest.
“The stakes aren’t existential in terms of survival,” Watson clarified. “But they are existential in economic terms.”
Increased costs will ricochet across the state: higher utility bills, a heavier burden on low-income households, costlier goods and services, and intensified outmigration. The challenge isn’t about keeping the lights on. It’s about keeping Alaska competitive, livable, and just.
The Bridge and the Fork
Watson offered a metaphor for the path ahead—a trail hike through the Chugach, with a stream to cross and a forked path a few miles away. Utilities will need to make some investments to ensure short term reliability, then build a bridge across the stream (medium term, but reliable solutions including small-scale imports of liquefied natural gas). On the other side of this bridge will be two starkly different forking paths for Alaska: import large quantities of LNG or bring gas down from the North Slope via pipeline and exporting the surplus to international markets.
Both are costly, complex, and politically loaded.
“If we get it wrong,” Watson warned, “we build a bridge that leads us to a path we regret.”
A Producer’s Lament
If Watson’s tone was diagnostic, John Hendrix’s was defiant. The CEO of Furie Operating Alaska—one of the few remaining gas producers in the basin—challenged the narrative of depletion and scarcity.
“There’s gas there,” he said plainly. “We just have to develop it.”
Hendrix, a grizzled veteran of oil and gas operations from Prudhoe Bay to the Middle East, was unsparing in his critique of what he called a “false mindset” that Alaska must become a net importer of energy.
At the heart of Hendrix’s frustration is the dichotomy between producers and utilities, between risk and regulation. Utilities want long-term contracts to ensure reliability. Producers, burned by past bankruptcies and underinvestment, want commitments and pricing that reflect the true costs—and risks—of production.
“We’re risking our capital,” Hendrix said. “Utilities go to the RCA and get recovery. We get nothing unless the gas flows.”
He also highlighted the burden producers carry that renewables and utilities do not: property taxes, full royalties (12.5%), and no guaranteed cost recovery. “If I were a utility, I wouldn’t pay property tax. If I were renewables, I wouldn’t pay royalties. But I’m oil and gas—I pay both.”
Utilities Bridging Gaps
Arthur Miller, CEO of Chugach Electric Association, spoke with a stoic urgency. Chugach, the state’s largest electric utility, gets 60% of its gas from its Beluga River Unit (which it partly owns) and 40% from Hilcorp—a contract that expires in March 2028.
“No supplier has come forward with a firm offer to replace that gas,” Miller stated. Miller mentioned that it would be in the best interest for the utility companies of Alaska to coordinate their plans, but their different contract time horizons make it difficult. Chugach Electric has the shortest runway to find a solution.
To manage the looming shortfall, Chugach is building a buffer: underlift agreements with Hilcorp, a gas exchange with Marathon Petroleum, investments in gas storage, and 30 MW of a new battery storage system. But those measures are temporary, bridging only a few years.
The real question, Miller echoed, is what comes after.
Imported LNG is one answer—specifically through the Kenai LNG Terminal, now under redevelopment by Harvest Alaska. The timeline matches Chugach’s need, and while importing gas is more expensive, the utility estimates a 10% increase to electric bills—a manageable, if painful, bump.
But it’s not the preferred path.
“We’d rather use Alaska gas,” Miller insisted. “But we need gas in 2028. Full stop.”
The Gatekeeper’s Dilemma: Enstar and the Clock
As president of Enstar Natural Gas, Alaska’s largest gas utility, Sims does not produce energy, nor does he convert it to electricity. He delivers it. His job is to manage expectations, hedge bets, and—above all else—ensure that gas flows to the homes and businesses that rely on it, no matter the upstream drama.
Enstar, like Chugach Electric, has a major contract with Hilcorp that expires in 2033. Unlike a utility with a power plant or a producer with a drill bit, Sims doesn’t have the option to diversify in place. If the gas doesn’t arrive, Enstar doesn’t deliver.
He pointed to the stark map of current lease ownership: Hilcorp controls most of the Cook Inlet basin. The remainder—Furie, BlueCrest, and a scattering of smaller players—are producing, but not at a scale that can replace what’s lost. Hilcorp has made clear it will not renew existing contracts under previous terms. That decision may be rational, but it is not comforting.
Like others, Sims praised Furie’s investment and commitment, but he was brutally honest about the limits of optimism. “If Furie succeeds—and I hope they do—it’s maybe 11% of the total market. We still have to find the other 89%.” By the following summer, Hendrix noted, it may produce 16%.
For Sims, the math isn’t just sobering—it’s structural. Utilities cannot build a business plan around hopes or handshakes. They need firm delivery volumes, with real molecules behind them, and an enforceable price. Producers, understandably, need assurances they won’t be undercut by LNG imports or priced out of the market after investing millions.
That is why Enstar is also pursuing LNG as a backstop. They have an exclusivity agreement with Glenfarne and plan to build a new terminal. Sims called it “a necessary insurance policy,” not a preferred path.
“If I could buy every molecule John Hendrix drills, I would,” Sims said, “and I will. But that still doesn’t fix the whole problem. We need scale, and we need certainty.”
Time, he reminded the audience, doesn’t yield to process. “We can’t bank on a North Slope pipeline. We can’t wait for federal permitting cycles. We’ve got to make decisions that protect customers—today.”
The quiet implication: failure to act isn’t theoretical. It’s logistical.
North Slope Mirage?
Talk of bringing gas from the North Slope—once a state obsession—now elicits weary nods and half-hearted hand raises.
“Who thinks a pipeline from the North Slope is coming?” John Sims asked. Five hands rose among a crowd of dozens.
The Alaska LNG pipeline has been studied, delayed, and reimagined for decades. But in the absence of shovels in the ground, utilities can’t plan on a promise. They need certainties, not aspirations.
The problem isn’t belief—it’s bankability.
The Role of Government: Keeper of the Hopper
Throughout the forum, another thread emerged: the need for better policy alignment and state leadership.
Who, exactly, is coordinating Alaska’s energy transition? Is it the Department of Natural Resources (DNR)? The Regulatory Commission of Alaska (RCA)? The Alaska Energy Authority (AEA)? The utilities? The Legislature?
“The hopper of opportunities is there,” Hendrix said. “But who’s keeping it?”
DNR Director Derek Nottingham acknowledged the fragmentation. His presentation highlighted recent drilling (19 wells completed in 2024 across multiple fields), and upcoming undeveloped gas projects that could add supply. But even with aggressive development, the basin’s ability to meet growing demand remains in doubt.
“We don’t have a central authority coordinating production, regulation, and consumption,” Hendrix noted off-mic. “It’s everyone managing their corner.”
Reframing the Future
As the session drew to a close, a sense of convergence emerged. No single solution will save Cook Inlet’s gas ecosystem. But neither will inertia.
Short-term, the region needs aggressive storage, flexible contracts, and policy support to incentivize new exploration.
Medium-term, imported LNG may be unavoidable. The infrastructure is being readied. The cost impact—significant but not catastrophic—is a political hurdle, not a technical one.
Long-term, the fork in the trail remains: an import economy or a pipeline reality.
And beyond even those binary choices lies the promise—and complexity—of decarbonization. Electric utilities like Chugach have set ambitious goals: reduce carbon intensity by at least 35% by 2030, 50% by 2040, so long as rates and reliability are not compromised. That’s a fine line to walk—especially when you’re also bracing for an energy crunch.
However, decarbonization doesn’t mitigate the supply needs of the natural gas utilities that heat our homes.
Conclusion: Bridging To The Fork
Utilities like Chugach and Enstar are already navigating the bridge—patching together underlift agreements, investing in storage, exploring renewables, and preparing for LNG imports. They are managing the immediate crossing, step by cautious step, with one eye on the current and the other on the shoreline ahead.
But the real decision doesn’t belong to them alone. At the far end of that bridge lies a fork in the road—one that Alaska as a state must confront. Will we invest in the infrastructure and policy coordination needed to become a long-term energy exporter, unlocking North Slope gas and leveraging our vast reserves? Or will we accept the role of importer, dependent on volatile global markets for the fuel that powers our economy and warms our homes? Perhaps we will cross our fingers for a future technology that simply doesn’t exist yet.
This is not just a question of engineering or pricing. It is a question of identity—of sovereignty, resilience, and economic direction.
The bridge can only carry us so far. What matters now is whether we choose a path that ensures energy security for the next generation—or simply delay the decision until the options disappear.
The stream is rising. The fork is near. And our time horizons, as ever, are getting shorter.
If you benefit from this information, join Commonwealth North as a member. You will not only be supporting future conversations but adding your voice to the mix.
ANCHORAGE, Alaska — For decades, Alaska’s economy has rested on a “three-legged stool” of petroleum, private industries like mining and fishing, and federal spending. But as oil revenues wane and federal policies shift, economists warn that the state’s reliance on Washington’s largesse is growing — and with it, new vulnerabilities.
At a virtual economic forum hosted by the Commonwealth North, University of Alaska Anchorage’s Institute of Social and Economic Research (ISER), and Build Alaska’s Future on May 1, 2025, leading economists delivered a nuanced assessment of Alaska’s economic trajectory. Titled “How Shifting Federal Dollars Impact Alaska’s Economy,” the event underscored the state’s heavy reliance on federal funds, the growing role of the Alaska Permanent Fund in state revenue, and the challenges posed by federal policy shifts under the current administration.
The Economic Pie
Alaska’s economy, valued at approximately $70 billion with a population of about 730,000, is uniquely tethered to federal spending, which injects an estimated $13 to $14 billion annually—roughly one-fifth of the state’s economic activity. Dr. Scott Goldsmith, Professor Emeritus at ISER, framed the discussion with his “three-legged stool” model, comprising petroleum, basic-sector private industries (e.g., mining, tourism), and federal spending. While petroleum’s role has diminished, federal dollars have become increasingly critical, with Alaska ranking third nationally in per capita federal expenditures at approximately $25,000 per resident in FY 2022.
“Federal dollars are big, growing in importance, and more significant than most realize,” Dr. Goldsmith said, noting their historical stability. He outlined five key streams: civilian departments ($1.5 billion in wages), military spending ($4.7 billion), grants to governments ($6 billion, the highest per capita nationally), payments to individuals like Social Security ($2.2 billion), and loans or insurance.
However, the forum highlighted a significant shift in state revenue dynamics. As petroleum revenues have declined, the Alaska Permanent Fund has emerged as a cornerstone of state finances, providing a growing share of revenue to offset fiscal vulnerabilities and stabilize the economy amid federal uncertainties.
A Flat Economy with Emerging Strengths
Dr. Brett Watson, an ISER assistant professor specializing in natural resource economics, provided context for Alaska’s economic performance. March 2025 a new record high level of seasonally adjusted employment. Real GDP and employment have returned to pre-recession (2015) levels. Alaska’s recent growth has outpaced the nation, with 6.3 percent employment growth from 2022 to 2024, nearly double the national average. This comes as the oil sector’s decline has decoupled the economy from petroleum, particularly for state government revenue which is now increasingly reliant on federal dollars and Permanent Fund returns.
Watson noted that the oil sector, once a dominant force, has weakened significantly, with production down 15% to 479,624 barrels per day and prices falling 30% from $105 in March 2014 to $72.50 in March 2025.
Despite this, sectors like healthcare and construction have driven post-pandemic recovery, fueled largely by federal spending. However, national economic headwinds—a first-quarter GDP contraction, pessimistic consumer and business surveys, and trade-driven recession forecasts—threaten Alaska’s stability. “If the country slides into recession, Alaska will struggle to avoid one,” Watson warned, citing exposure to commodity price volatility and federal policy shifts.
Permanent Fund Bolsters State Revenue
A key development discussed at the forum was the growing role of the Alaska Permanent Fund in sustaining state finances. As outlined in the forum’s slide deck, state petroleum revenue has plummeted, dropping from historic highs to a fraction of its former contribution. In contrast, federal spending and Permanent Fund earnings have risen sharply. The Permanent Fund, established in 1976 to save oil revenue for future generations, now generates significant income through investments, with its market value exceeding $80 billion in 2025.
In recent years, the fund has contributed over $3 billion annually to the state budget, surpassing petroleum revenue in some fiscal years. This shift has provided a buffer against the volatility of oil markets. However, Goldsmith cautioned that the state’s fiscal situation remains unsustainable long-term due to persistent budget deficits and liquidity concerns with the Permanent Fund’s spendable portion. “The Permanent Fund is a lifeline, but it’s not a cure-all,” he said.
Federal Workforce Reductions Threaten Stability
Dr. Brock Wilson, an ISER research assistant professor focused on labor economics, addressed the looming impact of federal workforce cuts. Drawing on a New York Times dataset, he noted that a proposed 12% reduction in the 2.4 million civilian federal workforce could result in a 2% to 4% cut in Alaska’s federal civilian jobs, which number around 16,000 and account for 3.2% of the state’s labor force—the third-highest proportion nationally. In Q3 2024, federal civilian workers earned an average monthly salary of $8,641, ranking third among Alaska’s industries for pay.
Key agencies like the Department of the Interior, Air Force, and Army are major employers, with 53% of federal workers concentrated in Anchorage Municipality and 21% in Fairbanks North Star Borough. Wilson highlighted data gaps, noting that he is awaiting payroll data via a Freedom of Information Act request to assess regional and agency-specific impacts. “We’re piecing together a puzzle in the dark,” he said, emphasizing the uncertainty’s toll on local economies.
Infrastructure and Supply Chains Face Headwinds
Dr. Mike Jones, an ISER research assistant professor specializing in transportation and supply chains, discussed challenges to Alaska’s infrastructure projects. The state has secured $8.5 billion from the Biden-era Infrastructure Investment and Jobs Act, including $81.2 million for rural airports and $16.8 million for the Alaska International Airport System in FY 2024. However, federal workforce reductions have created an “implementation crisis,” with agencies like the Department of Health and Human Services (HHS) struggling to administer grants and ensure compliance.
Rural programs, like the Low-Income Home Energy Assistance Program, face disruptions, while alternative energy grants worth $700 million are vulnerable.
Jones cited Senator Lisa Murkowski’s remarks at a recent infrastructure symposium, where she noted a lack of clarity on committed funds and staffing shortages that leave project managers without points of contact. “If a multi-year project is delayed, it may never happen,” Jones warned, particularly for rural initiatives. Additionally, trade disruptions from a 10% across-the-board tariff, with over 100% on Chinese goods, are driving cost increases. Alaska’s off-road communities, where 80% of non-food retail goods are imported, face heightened risks, and marine cargo shippers to the state have reported that volumes are already slowing.
Policy Shifts and Economic Opportunities
The forum explored how federal policy changes, including executive orders from President Trump, could reshape Alaska’s economy. Watson highlighted an order to “unleash Alaska opportunity” by easing restrictions on resource development in the National Petroleum Reserve-Alaska (NPRA) and the Ambler mining district. Projects like Willow and Pikka are driving construction jobs. Dr. Watson advocated for well-staffed permitting agencies to unlock resource development, citing Nevada’s efficient mining permits.
Conversely, proposed cuts to Medicaid, which delivers $3 billion annually to Alaska (75% federally funded), could devastate healthcare access and rural hospitals. Jones emphasized healthcare’s role in employment growth, with educational and health services adding 3,000 jobs from March 2019 to 2024. Goldsmith warned that Medicaid reductions would have cascading effects on the state’s healthcare infrastructure.
On the energy front, Jones noted that over $700 million in Inflation Reduction Act (IRA) awards for alternative energy projects, such as microgrids for isolated communities, are at risk. A proposed natural gas pipeline has federal support but may not serve remote areas like Togiak, underscoring the need for localized energy solutions.
Navigating a Complex Future
Moderator Mead Treadwell, a former Alaska lieutenant governor, facilitated audience questions on stabilizing Alaska’s economy. With Alaska’s congressional delegation holding key roles on appropriations and authorization committees, panelists offered priorities. Goldsmith advocated protecting grant programs for highways, airports, and Indian Health Services, while Watson emphasized efficient permitting for resource development, citing Nevada’s mining permits as a model. Wilson and Jones stressed workforce transition support and contingency plans for programs like the Alaska Bypass Mail system, critical for rural economies.
The growing senior population, up 60% in the last decade, will increase demand for Social Security and Medicare, complicating budget negotiations. Meanwhile, the Permanent Fund’s rising contribution offers a fiscal cushion but requires careful management to ensure long-term viability. “We’ve started this recovery,” Jones said optimistically. “The challenge is sustaining it amid federal and global uncertainties.”
As Alaska grapples with lower oil prices, potential federal cuts, and trade disruptions, the forum underscored the need for strategic advocacy and resilience. Alaskans face a critical juncture to balance immediate needs with long-term fiscal stability in a rapidly changing economic landscape.
ANCHORAGE — At a Commonwealth North forum on April 23, 2025 at the Anchorage Museum Theater, educators and policymakers confronted the deepening crisis in Alaska’s public schools, from vanishing teachers to crumbling classrooms.
Yet, the state’s tight-knit communities emerged as a beacon of hope, with panelists — including the education commissioner, a school board vice chair, a charter school principal, and the 2024 Alaska Teacher of the Year — urging Alaskans to stay engaged to secure a brighter future.
Their discussion laid bare the stakes: without urgent action, Alaska’s schools risk collapse, threatening the communities and professions they sustain.
A Funding System on the Brink
Alaska’s education funding formula, tied to the Base Student Allocation (BSA), has not kept pace with inflation, leaving school districts struggling with rising energy, health care and salary costs. Carl Jacobs, vice chair of the Anchorage School District (ASD) board, labeled the system “fundamentally broken,” pointing to a mismatch between the state’s fiscal year budget cycle and Municipality of Anchorage’s calendar-year budget. Jacobs shared that ASD is required to approve an annual balanced operating budget by the first Monday in March. These factors, added together, inadvertently promote budgetary guesswork pending erratic one-time state funding, resulting in resource allocation challenges and staffing instability.
Deena Bishop, Alaska’s Commissioner of Education, noted that while total education funding has risen, the state’s share is shrinking as local contributions grow, especially in incorporated areas. Over the past decade, 15,000 students have shifted to correspondence programs, which receive 90 cents per dollar, draining district revenues. Governor Mike Dunleavy’s legislation seeks to ensure full funding for these students. Bishop stressed that money alone won’t suffice without policy reforms.
Brandon Strauch, principal of Rilke Schule German School of Arts and Sciences, a charter school in Anchorage, stated that his school’s budget, historically 80% staffing and 20% rent, is unsustainable: a 2024-2025 reserve fund of $1.6 million will lose $600,000 in FY25-26 and $700,000 in FY26-27, leaving just $300,000. “This is not a sustainable system,” Strauch said. A new ASD partnership will lower rent, currently $738,000, but challenges persist. Strauch emphasized Rilke Schule’s community-driven approach: a $225 student activity fee funds supplies, parent organizations support after-school programs, fund raisers provide additional funds, and parents contribute 3,500 recorded volunteer hours annually, likely half their total effort.
Teacher Retention: A Looming Cliff
Alaska’s schools are hemorrhaging educators. Cat Walker, a 19-year STEM teacher and 2024 Alaska Teacher of the Year, warned that 40% of Anchorage School District (ASD) teachers are in their first three years, with 300 resignations by April 1, including 44 mid-year departures. Attracted by Alaska’s robust training, many leave after three years for states with pensions, she said. As a Tier 3 employee without one, Walker, alongside her educator husband, may soon depart. “I love it here, but we can’t stay without a pension,” she said, her voice heavy with inevitability.
Walker warned that overfunding charters and correspondence schools depletes neighborhood schools, limiting Advanced Placement classes, nurses, and special education support.
Carl Jacobs, ASD board vice chair, cited a Department of Education survey of 4,000 educators, pinpointing competitive salaries, affordable healthcare, and a defined benefit retirement plan as retention priorities. In 2022, 22% of Alaska’s 1,634 teachers left, 13% exiting entirely, while the University of Alaska certifies fewer than 200 new teachers annually. ASD employs stopgaps like J-1 visa teachers and rehired retirees, but these are not sustainable.
Infrastructure and Access Gaps
Infrastructure woes plague schools statewide. Walker recounted School Board member Kelly Lessens shock at Dimond High School’s missing ceiling tiles and a toilet that sprayed water, forcing her to cordon off the stall.
Statewide, conditions are graver: Sleetmute’s school faces condemnation after 19 years of unaddressed roof leaks, Venetie’s wiring is dangerously flammable, Thorne Bay’s sprinklers have been inoperable for 17 years, and Newtok’s students were sent home when bathrooms failed. Access barriers compound the crisis, with charter schools’ lack of transportation and reliance on volunteer hours excluding families without means, Walker noted.
Policy Innovations and Community Strength
Despite the grim outlook, progress is evident. Bishop praised the 2022 Alaska Reads Act, which boosted reading proficiency, with 60% of kindergartners achieving first-grade readiness in its first year, outpacing national growth. A 2023 Harvard study ranked Alaska’s charter schools as the nation’s top performers, supporting their innovative role. Dunleavy’s proposals include tribal compacting, charter school reforms, $450-per-student learning growth grants, and a research-backed cell phone ban to sharpen focus.
Jacobs highlighted ASD’s proactive steps: co-locating childcare in elementary schools to retain educators, introducing financial literacy curricula, launching the Academies of Anchorage to connect students with businesses, and ensuring minimum lunch periods to boost student physical health and academic outcomes. Jacobs also called on state lawmakers to implement a sustianable long-term fiscal plan to fund core government services citzens deserve and depend on.
Walker’s STEM programs, like a drone class with a 100% FAA license pass rate, rely on community partnerships, though securing grants is arduous. She shared the story of Kevin, a student who struggled in large classes but thrived in specialized activities, designing a police connector and phone holders for low-vision patients. Such successes, she argued, depend on small classes and targeted programs, which are at risk without funding.
A Call for Engagement
Panelists united in praising community engagement as Alaska’s greatest asset. “The people in our schools — families, students, educators — make the magic happen,” Bishop said. Strauch lauded the state’s “good people” committed to shared goals, while Walker hailed students’ resilience and urged voting to support schools. Jacobs proposed that legislators spend time in classrooms to understand needs, fostering collaboration to dispel myths about administrative spending. “The biggest investment we can make is a qualified teacher in every classroom,” he said.
If you were unable to attend—or would like to revisit the conversation—you can view the full forum recording on YouTube:
Ross Johnston is a visionary leader whose passion for community building and transformative change has made him a perfect fit to lead Commonwealth North into an exciting future. With over 15 years of experience at the helm of Fine Point LLC, Ross has proven himself as a dynamic business leader and marketing expert dedicated to driving results and fostering economic growth across Alaska.
Throughout his career, Ross has launched innovative initiatives like North By North and Accelerate Alaska, and served as President of the American Marketing Association Alaska Chapter. His track record speaks volumes: Ross not only facilitates meaningful dialogue around Alaska’s opportunities, but he also champions the adoption of innovative solutions that drive tangible progress for our state.
The Commonwealth North Board chose Ross for his unique ability to turn ideas into action and for his deep commitment to making a difference—both in the community that raised him and in the future he envisions for all Alaskans. His leadership embodies the spirit of personal involvement and forward-thinking that we believe will inspire a new era of public policy and community empowerment.
Join us in welcoming Ross Johnston as we embark on this exciting journey to build a stronger, more vibrant Alaska together!
From Ross Johnston
“Why I Joined Commonwealth North as Executive Director”
Stepping into the role of Executive Director at Commonwealth North felt like a natural evolution of the work I was already doing—building community, facilitating conversations, and driving action around Alaska’s biggest opportunities.
But for me, it’s not just about discussion. I’m results-oriented. Alaska’s challenges demand more than just dialogue—they require real, innovative solutions that move our future forward. I want to help bridge the gap between ideas and action, ensuring that policy conversations lead to tangible outcomes that benefit all Alaskans.
This role is also deeply personal. It’s a way to give back—not just to the community and family that raised me, but also to my children, by showing them the power of personal involvement in shaping the place we call home. Just as my parents Allan Johnston & Jennifer B. Johnston have done for me.
#Alaska has incredible potential, and I’m excited to work alongside leaders, policymakers, and engaged citizens to help unlock it. Let’s build something great together.
What do you think is the biggest opportunity for Alaska’s future?
Join me in the conversation by becoming a member, https://www.commonwealthnorth.org/membership/#join
Executive Director and CEO, Deven Mitchell of the Alaska Permanent Fund Corporation addressed Commonwealth North following the September meeting of the Board of Trustees. Mitchell looked at the corporation’s performance and outlook, discussed the Board of Trustees recommendations for creating a true endowment structure for the fund, and responded to audience questions. You can view a recording of the session viewed here. Mitchell’s slides can be downloaded here.
Commissioner Deena Bishop and Lori Weed, School Finance Manager, with the Alaska Department of Education and Early Development spoke to Commonwealth North on Wednesday, July 17. Bishop and Weed walked through how state aid for education is determined. Using the foundation formula, adjustments, the base student allocation, and any special appropriations, Alaska school districts receive an allocation based on funds appropriated by the legislature. For a program recap, see the session recording and speaker slides linked below:
