Policy Brief

Alaska Eyes Gold for Scholarships

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At a time when governors in the recession-ravaged Lower 48 are slashing education budgets, Alaska Gov. Sean Parnell is hoping state lawmakers will use $400 million from reserve funds to finance higher education scholarships for high school students.

“I want to set the bar higher for our high school students to promote preparedness,” Mr. Parnell, a Republican, said last week in a statement proposing the Governor’s Performance Scholarship program. Money from the reserve fund would be used to generate earnings for the scholarships.

Under the program, students would have to take four years of math, science, and language arts, as well as three years of social studies. The program would provide A students with 100 percent tuition scholarships, B students with 75 percent tuition, and C-plus students with 50 percent tuition.

The scholarships could be used in the University of Alaska system, certified job-training institutions, and other postsecondary institutions.

Gov. Parnell called the proposal fiscally responsible and sustainable, and said Alaska “will have a greater economy for having invested the earnings from the money.”

Alaska, with an economy buoyed by oil and gas revenue, is in an unusual fiscal position. Its K-12 spending will rise 5 percent, to just over $1 billion, in fiscal 2010. By contrast, dozens of states predict K-12 budget cuts in that time frame, a survey by the National Governors Association and the National Association of State Budget Officers found. (See “Budget Outlook for States: Grim,” June 17, 2009.)

Not that Alaska hasn’t felt a chill. The state’s department of revenue says somewhat fewer residents are putting part of this year’s dividend check from the Alaska Permanent Fund toward college savings than in recent years.

This year’s dividend checks come to $1,305 for each eligible resident—a total of 628,499 people this year. Of those, 8,289 directed money into the University of Alaska College Savings Fund, the Fairbanks Daily News-Miner said. That’s down from 8,766 in 2008, say state officials.

Vol. 29, Issue 07, Page 16

Published in Print: October 14, 2009, as Alaska Eyes Gold for Scholarships
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