The Alaska House of Representatives passed a bill that moves to protect Alaska’s higher education funding from the annual political battle to ‘sweep’ the fund. House Bill 229 clarifies that the Higher Education Investment Fund, which finances merit-based Alaska Performance Scholarships, the needs-based Alaska Education Grant, and the WWAMI medical program on its annual earnings, is not subject to the annual sweep of funds into the Constitutional Budget Reserve.
Rep. Andy Josephson (Anchorage) said:
“This bill would take the Higher Education Investment Fund and also the Performance Scholarships and Education Grants and it would put them in a statutory place where they couldn’t be swept into the Constitutional Budget Reserve (CBR). This happens by creating these funds as separate funds, outside the general fund and also housing them in the Alaska Student Loan Corporation following a model that we borrowed from. Inviting the Student Loan Corporation to create a subsidiary which further isolates them from sweepability and also creating them as a trust.”
The HEIF hasn’t been subject to the annual sweep provision until 2019. The annual sweep provision is a requirement of the constitution that money leftover in the general fund be swept at the end of the year into the CBR, which is then ‘reverse swept’ with a three-quarters vote in both bodies to refill the various funds. If signed into law, HB 229 aims to protect those programs by moving the HEIF into the Alaska Student Loan Corporation, which would prevent it from being negotiated upon.
Rep. Josephson added:
“What we’re doing we are saying this item is not going to be swept into the CBR again. It’s perfectly legal to do it. The judges have said so. The same thing has been enjoyed by the stakeholders for PCE. I’d ask for your support. We’re going to hear some folks say, ‘this is a dedicated revenue’. It’s not a dedicated revenue, it’s a designated revenue.”
Recipients of the funds have included Alaska Christian College, Alaska Bible College, Northern Industrial Training, Trend Setters School of Beauty, Wayland Baptist University, and other career and technical educational institutions in Alaska.
The bill passed the House on a 23-9 vote and moves onto the Senate for consideration.
Transcribed audio courtesy of KTOO 360TV.