Governor vetoes school funding bill, arguing it lacks enough of his policy proposals

Gov. Mike Dunleavy vetoed a bill last Monday, May 19, that would increase funding for schools and enact several policy changes the governor had asked for including streamlined procedures for charter schools and authority for school districts to restrict cell phones in schools.

The veto drew a sharp reaction from legislators. Sen. Loki Tobin, D-Anch., who chairs the Senate Education Committee, had this to say:

“Governor Dunleavy wants a cellphone ban. HB 57 includes a cellphone ban. Governor Dunleavy wants reading incentive grants. HB 57 includes reading incentive grants. Governor Dunleavy supports charter schools. HB 57 supports charter schools,” Tobin said in a statement.

“The bill the Governor just vetoed included many of his wants, and the one thing our public schools actually need, funding. Without an increase to the BSA (Base Student Allocation), school districts will need to close schools, fire teachers, and increase class sizes. That is not what our communities want,” she said.

Legislators may override the veto of the House Bill 57 in a joint session of the House and Senate but Dunleavy has said that if the veto is overidden he may veto or reduce funds from the budget to pay for an increase in the state’s BSA, the formula that guides state funding for school districts, provided in HB 57. The bill adds $700 to the BSA, which now pays $5,950 per students to school districts.

The state House had originally proposed a BSA increase of $1,000 but the Senate, concerned about state finances, reduced it to $700 in HB 57. Dunleavy had himself proposed a BSA increase of $580 in a bill linked to more policy changes than were in HB 57.

Money was a factor in the governor’s decision, however. He said HB 57 would impose added costs on a state budget stretched thin by falling oil revenues but also that the bill didn’t include enough of his proposals. Two proposals Dunleavy wants that weren’t in the legislation included statewide “open enrollment” for students to enroll in any school in the state and special “incentive” grants for elementary schools showing gains in reading.

Grants for reading instruction were included in HB 57 at the end but were linked to passage of SB 113, a bill placing a state corporate income tax on out-of-state corporations like Amazon that do business in Alaska. The governor may also veto SB 113 partly because he dislikes taxes, “that will just encourage the Legislature to spend more,” he said in a press conference held Monday, May 19.

The governor also complained during the press conference that his proposal from previous years for “retention” bonuses for teachers renewing their contracts wasn’t given consideration by the Legislature, although the bonuses were not included in an education reform bill Dunleavy introduced earlier this year. More money for home-schooled students was also requested earlier by the governor but was not in HB 57. “The Legislature did not negotiate in good faith,” in balancing his policy proposals against requests for more money from schools, the governor said.

Dunleavy also said he will introduce new legislation that will include what he wants in the way of policy changes. Although there were only two days left in the 2025 legislative session Dunleavy said there was time left. “You can be surprised by how quickly the Legislature can move when it wants to,” he said. The governor also would not rule out calling a special session. However, a new bill from the governor introduced now will still be alive next January, when the Legislature returns for its 2026 session.