Court Rules Alaska Education Funding Mandate Unconstitutional
December 01, 2014
According to Borough Manager Dan Bockhorst, the Ketchikan Gateway Borough is pleased with the November 21st decision of Superior Court Judge William Carey invalidating the Required Local Contribution statute on the grounds that the law in question runs afoul of the dedicated funds clause of Alaska’s Constitution. In his ruling, Superior Court Judge William Carey said that boroughs are not required to help pay for public education. In his ruling, Carey said that the Required Local Contribution is, essentially, a tax earmarked for a special purpose, which violates the state Constitution. Bockhorst explained that under the Required Local Contribution statute, the State has forced the Ketchikan Gateway Borough to annually backfill millions of dollars in Basic Need for Ketchikan’s schools. At the same time, the State has fully funded Basic Need for Alaska’s 19 non-municipal school districts. The state Department of Education’s budget for the 2013-2014 academic year was $1.4 billion, with $222 million of that coming from required local contributions provided by boroughs and first-class cities. In just the past 25 years, Ketchikan taxpayers have paid nearly $110 million in these unconstitutional mandates said Bockhorst. He said when the Ketchikan Gateway Borough was incorporated in 1963, voters had been given assurance in State law that “No area incorporated as an organized borough shall be deprived of state services, revenues, or assistance or be otherwise penalized because of incorporation.” Regrettably, organized boroughs have long suffered heavily penalties because of incorporation. Bockhorst said he was ebullient over Judge Carey’s decision. Bockhorst labeled November 21st, the date of Judge Carey’s decision, as “Keep the Promise Day” referring to the 1963 promise by the State that boroughs would be treated fairly. On behalf of the Alaska Department of Law, Cori Mills, Assistant Attorney General provided a response to Judge Carey's decision. “We are disappointed with the superior court’s decision invalidating the local contribution requirement for school funding." According to the press statement, the State maintains that because the local contribution is simply the borough’s share of the cost of educating its students and because the local contribution is funded with borough revenue, the local contribution is not a source of state revenue and is not subject to the dedicated funds provision. The Alaska Department of Law said, "Alaska has a long and proud tradition of state-local cooperation over education, including significant local control and a requirement of local monetary contributions to the funding of local schools." Despite the victory on the constitutional issue of the dedicated funds clause, the Ketchikan Gateway Borough was not granted a refund from the State of the Borough’s $4.2 million FY 2014 Required Local Contribution. According to Bockhorst, the Borough is evaluating the Court’s decision on that point and other points. An executive session of the Ketchikan Borough Assembly was scheduled for today, December 1, to discuss legal strategy regarding the matter. The Alaska Department of Law is pleased that the court agreed with the State that the local contribution does not violate the appropriations and veto clauses of the Alaska Constitution. The Department also agreed with the court’s decision to deny the Ketchikan Gateway Borough’s request for a refund from the State of the local money that it paid directly to the Ketchikan School District. The Alaska Department of Law will also continue to evaluate the court’s decision and their appeal options. Bockhorst praised the work of the attorneys who represented the Borough – Scott Brandt-Erichsen and Louann Cutler – and also recognized the work of attorney Bob Hicks who prepared extensive legal and policy analysis for the Borough regarding the matter. Bockhorst commended the current and past Borough Mayors and Assembly Members for their pursuit of reform on this critical topic. He stressed that given the current fiscal challenges facing the State of Alaska, it is all the more imperative to ensure equal and fair treatment among all Alaskans with respect to State services, revenues, and assistance. Bockhorst said in the absence of the successful challenge of the Required Local Contribution, the State would likely shift even greater burdens to borough governments. Bockhorst stressed that Judge Carey’s decision is good news for those who seek fairness in the way schools in Alaska are funded. Bockhorst also recognized and thanked the four private-party Plaintiffs in Ketchikan who joined the Borough in the legal challenge. Those private-party Plaintiffs are Agnes Moran, John Coss, John Harrington, and David Spokely. Additionally, Bockhorst expressed great appreciation for the strong support from the Fairbanks North Star Borough Mayor, Assembly Members, and Fairbanks Borough Attorney. The Fairbanks North Star Borough joined the Borough’s lawsuit as an amicus curiae party in February 2014.
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