Legislature(2023 - 2024)SENATE FINANCE 532
02/20/2024 09:00 AM Senate FINANCE
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| Audio | Topic |
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| Start | |
| University of Alaska – Fy 25 Budget Request | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| + | TELECONFERENCED |
SENATE FINANCE COMMITTEE
February 20, 2024
9:48 a.m.
9:48:53 AM
CALL TO ORDER
Co-Chair Hoffman called the Senate Finance Committee
meeting to order at 9:48 a.m.
MEMBERS PRESENT
Senator Lyman Hoffman, Co-Chair
Senator Donny Olson, Co-Chair
Senator Bert Stedman, Co-Chair
Senator Click Bishop
Senator Jesse Kiehl
Senator Kelly Merrick
Senator David Wilson
MEMBERS ABSENT
None
ALSO PRESENT
Chad Hutchison, State Director of Government Relations,
University of Alaska.
PRESENT VIA TELECONFERENCE
Pat Pitney, President, University of Alaska.
SUMMARY
^UNIVERSITY OF ALASKA FY 25 BUDGET REQUEST
SUBCOMMITTEE OF THE WHOLE
9:49:22 AM
Co-Chair Hoffman relayed that it was the first hearing on
the University of Alaska's FY 25 budget. He related that
the UA president was online.
9:49:49 AM
CHAD HUTCHISON, STATE DIRECTOR OF GOVERNMENT RELATIONS,
UNIVERSITY OF ALASKA, introduced himself.
9:50:03 AM
PAT PITNEY, PRESIDENT, UNIVERSITY OF ALASKA (via
teleconference), discussed a presentation entitled
"University of Alaska - Empower Alaska - 33rd Legislative
Session, Financial Overview, UA Senate Finance Subcommittee
- February 20, 2024" (copy on file).
President Pitney looked at slide 2, "University of Alaska -
Alaska's System of Higher Education," which showed a map of
the state indicating locations of University of Alaska (UA)
campuses. She reminded the committee that UA had three
unique universities including a research university in
Fairbanks (UAF), a comprehensive urban university in
Anchorage (UAA), and a regional experiential-based learning
university at the University of Alaska Southeast (UAS) with
its main campus in Juneau. She noted that each of UA's
universities had community campuses that reached from
Ketchikan to Kotzebue.
President Pitney spoke to slide 3, "Overview
•Board's Roadmap to Empower Alaska
•Enrollment and Program Highlights
•FY25 Budget Request
•Fiscal Summary
•FY25 Operating Budget
•Legislative Priorities
•Appendix
O FY24 Supplemental
O Economic Development Project Updates
O FY25 Capital Budget
President Pitney noted that the board was relatively new,
with six incoming members in the previous two years. She
expressed appreciation for the board's engagement.
President Pitney referenced slide 4, "Roadmap to Empower
Alaska
The Board of Regents' "Roadmap to Empower Alaska" is a
new robust plan for UA to advance Alaska's economy
through education, workforce development, research,
and strong partnerships across the state.
Three pillars represent the long-term vision for UA.
They are framed by guiding principles and achieved
through the implementation of priority strategies to
meet Board-established system goals and through well-
defined university/system office missions, roles, and
goals.
•Financially Responsible and Future-Focused -
efficient and responsive with diversified funding
focused on growing enrollment and research to meet
Alaska's workforce and economic needs
•State and Arctic Leadership - innovative and
essential to education, research, workforce, and
economic development; lead the nation in advancing the
US role in the changing Arctic
•Quality Education and Reputation - reputation for
providing high-value, high-quality education,
research, and service; known as innovative and
responsive 'jewels' in the state
President Pitney commented on the importance of the state's
presence in the Arctic as the area became a central focus
globally. She commented on UA's growing reputation and
cited that in the current year the first-time freshman
class enrollment was up 16 percent.
9:54:34 AM
President Pitney turned to slide 5, "Roadmap to Empower
Alaska
Board of Regents priority strategies:
•Increasing Recruitment, Graduation, and Retention
•Sustaining Facilities Maintenance and Modernization
Plan
•Achieving Cost-Efficient Operations
•UAF reaching R1 research status in 2027
•Empower Alaska Branding
•Building Arctic Leaders
President Pitney noted that the priorities listed on the
slide were reflected in UA's budget request. She explained
that the first priority was about financial stability. She
noted that UAF reaching R1 research status was featured
prominently in the budget. The status would move UAF into
the highest classification of research universities
nationally. The classification allowed for more
competitiveness and brought tremendous talent to the state,
which would impact the state as a whole. She mentioned
projects from Kodiak to Anchorage to Juneau to the North
Slope and west coast of the state. She emphasized that the
research expansion was about the state as a whole and
bringing talent to the state as well as long-term research
growth.
President Pitney continued her comments and avowed that UA
would work to strengthen the branding and UAs reputation.
She expressed excitement about the focus of the strategic
priorities as well as the commitment of the board.
9:57:49 AM
President Pitney considered slide 6, "Enrollment
Highlights
Spring 2024 Enrollment
•Headcount up 4 percent and student credit hours up
about 6 percent over Spring 2023, continuing sustained
growth.
•Significant enrollment increases at UAA and UAF
Community and Technical Colleges and the UAS School of
Career Education.
Dual enrollment
•In FY23, almost 3,600 high school students were
enrolled in a University course an increase of 20%
over FY21.
Retention
•Freshman-to-sophomore retention is at a five year
high.
•APS students seeking a 4-year degrees have an 85%
retention rate.
Teacher Preparation
•BA in Early Childhood Education at UAA continues to
grow enrollment (80 majors in Spring 2024).
•Pilot program awarded 63 scholarships to provide
financial support for students in teaching internships
in FY23.
Healthcare
•Expansion of the Nursing program ongoing.
•Pilot program for Clinical Health Placement provided
awards to 278 students in FY23 and we are expecting to
make approximately 400 awards in FY24.
Alaska in the national context
•Fall 2023 first-time freshman enrollments were down
3.6% nationwide, while UA first-time freshman
enrollment increased 16% from the prior year.
•The average debt of University of Alaska graduates
and the percentage of graduates with debt is below the
national and WICHE averages and average wages post
graduation are higher.
President Pitney discussed dual enrollment, which allowed
for the state and the students to have more accessible and
more affordable time to graduation. She mentioned high
school students acquiring a two-year degree. She mentioned
an appropriation two years previously that allowed for UA
to support students engaged in student teaching. She
summarized that UA was more affordable and offered students
higher earnings with less debt than other universities.
10:01:28 AM
Senator Bishop asked President Pitney to address teacher
preparation and wondered about outreach to indigenous
teachers in rural Alaska. He asked how many Indigenous
students in rural Alaska were part of the 63 scholarships
that were awarded.
President Pitney offered to get back to the committee with
more information about the 63 scholarships for students in
teaching internships in FY 23. She mentioned the upcoming
Educators Rising Conference in Juneau, wherein UA was
working with K-12 schools across the state to work with
students interested in education. She mentioned the
Preparing Indigenous Teachers and Administrators for
Alaskas Schools (PITAAS) Program, and culturally relevant
instruction.
Senator Bishop noted that he reached out annually to the 10
rural school districts in his district. He noted that he
had two video conferences with two school districts. He
mentioned juniors and seniors in high school that were
interested in becoming teachers, and asked Ms. Pitney to
follow up with the relevant information.
President Pitney agreed to follow up with the information.
Senator Wilson mentioned dual enrollment and asked about
the percentage of students that stayed with UA after
graduation.
President Pitney cited that the most previous metric was
about 50 percent, which was higher than the retention of
non-dual enrolled students. She noted that UA was looking
to increase the proportion of students that stayed with UA.
President Pitney displayed slide 7, "UAA Program
Highlights":
UAA receives $46M from the Department of Homeland
Security
This 10 year award positions UAA to lead a consortium
of U.S. academic institutions and partners for the
newly established Arctic Domain Awareness Center
(ADAC)-ARCTIC Center of Excellence (COE) for Homeland
Security in the Arctic.
UAA's School of Social Work $1.2 million Department of
Education grant
The three-and-a-half year program developed by UAA's
School of Social Work aims to graduate a cohort of 31
fellows who will increase school-based mental health
service providers in high-needs schools with Anchorage
School District (ASD) partner and community partners,
Providence Alaska and the Volunteers of America Alaska
(VOA), which currently operate programs addressing
social work needs in K-12 education.
New Cooperation Between the University of Alaska
Anchorage and Nord University
At the Arctic Circle Assembly in Reykjavik, Nord
University and the University of Alaska Anchorage
signed an agreement to strengthen the cooperation
between the two Arctic educational institutions. The
agreement recognizes the mutual benefits to be gained
through cooperative programs promoting scholarly
activities and international understanding.
LG Electronics, UAA Establish Consortium for Advanced
Heat Pump Research
Addressing the growing worldwide interest in cold-
climate heat pump technologies, the Consortium will
leverage the complementary expertise of technologists
at LG Electronics, a global heat pump leader, and the
College of Engineering at UAA and its highly regarded
HVAC Lab.
President Pitney highlighted slide 8, "UAF Program
Highlights
ACEP and Partners Receive $6 Million to Help Secure
Electric Grids
The project aims to advance the nation's "smart grid"
a planned nationwide network that uses information
technology to deliver electricity efficiently and
securely. The five-year project is named "STORM: Data-
Driven Approaches for Secure Electric Grids in
Communities Disproportionately Impacted by Climate
Change."
ACUASI Completes First Drone Flight from Nenana to
Fairbanks International Airport
The Alaska Center for Unmanned Aircraft Systems
Integration achieved the milestone when its Sea Hunter
aircraft touched down at the Fairbanks airport's
general aviation area at about 11:15 a.m. on Sept. 8,
2023, after making the 45-mile flight from Nenana. The
flight was the first in Alaska of a drone departing
one airport and arriving at a controlled airport.
FAA grants wide authority to UAF unmanned aircraft
center
FAA's decision came just over two years after the
state requested the waiver. Gov. Mike Dunleavy, U.S.
Sens. Lisa Murkowski and Dan Sullivan, and the Alaska
Department of Transportation and Public Facilities
voiced their support for the waiver so that the
industry could conduct research and development
testing with minimal paperwork.
Alaska's Railbelt can shift to renewables, but that
would require big capital investment
A report by UAF's Alaska Center for Energy and Power,
found that by 2050 non-fossil energy can supply
anywhere from 70% to 96% of the power needed to
produce electricity along the Railbelt. The region
comprises communities from Fairbanks in the Interior
to Seward on the Kenai Peninsula, the corridor along
the Alaska Railroad line that hold the vast majority
of the state's population.
USDA Grant Strengthens Future of Agriculture Systems,
Workforce
A five-year $18 million grant awarded to UAF's
Institute of Agriculture, Natural Resources and
Extension (IANRE) will help prepare the next
generation to take active roles in the country's
agricultural sector. The grant will allow
increased participation in important conversations
surrounding changing climate and food systems.
President Pitney thought the highlights on the slide
demonstrated a level of momentum that stability had brought
to the institution. She considered that when there was a
stable financial setting, UA leaders could work across
industry with legislators and industry to advance solutions
for the state.
President Pitney looked at slide 9, "UAS Program
Highlights
Coeur Alaska donates $300,000 to the Environmental
Science Endowment at UAS
In 1991 Coeur established an endowed scholarship at
the University of Alaska Southeast now known as the
Coeur Alaska -Kensington Gold Mine Environmental
Science Award. Coeur Alaska has continued to donate
additional funds to the endowment over the years and
this fall they generously donated $300,000 to the fund
in support of UAS Environmental Science students.
UAS Ketchikan Acquires Dedicated Vehicle for the
Maritime Training Center
The UAS Ketchikan Maritime Training Center (MTC) is
one of six members of the Alaska Maritime Education
Consortium, working to address the maritime workforce
needs across the state of Alaska. UAS Ketchikan has
been training mariners for over thirty years. The UAS
Maritime Training Center provides maritime programs
that meet regional needs throughout Southeast Alaska.
MTC recently acquired a new vehicle, funded partially
by a grant from the Rasmuson Foundation.
Education in Sustainable Ocean Farming Taking Off in
Sitka, Alaska
The UAS Sitka Campus, located on Baranof Island, has
established a one-of-a-kind training program in
sustainable ocean farming, where hands-on learning is
at the forefront of the curriculum. The excitement
surrounding mariculture opportunities has been growing
given the state's abundant natural resources, clean
waters, maritime experience, and existing seafood
infrastructure. This program is designed to mirror and
grow alongside this burgeoning industry and
provide students with experience in its established
salmon enhancement program.
10:06:38 AM
President Pitney showed slide 10, "FY25 Budget Request,"
and noted that she would provide a summary of UAs budget
request.
President Pitney advanced to slide 11, "FY25 Budget Request
Summary
•FY25 Operating Budget
•State funding request $29.2M
•Compensation and other operating costs
$23.2M
•Programs to support State and Arctic
Leadership $6M
•Deferred Maintenance and Modernization Strategy
$35M annually
Strengthen the competitiveness of UA's athletics
programs $5M
•Revenue Assumptions
•FY25 UA expects a net $5M increase in
unrestricted earned revenue
•$3M in tuition and fee revenue as
enrollment increases
•$2M in other unrestricted earned revenue,
such as interest income, university
receipts, and indirect cost recovery
(generated from restricted funds)
•Including eligible restricted funds, a
total of $7M projected earned revenue
increases have been applied to compensation
and operating cost increases
President Pitney noted that if the $35 million in proposed
funding for the deferred maintenance was consistent, it
would ensure that deferred maintenance would not grow. She
continued that when UAs debt impact rolled off, it would
add $10 million to make a $45 million annual commitment
over the next ten years. She emphasized the importance of
moving on from continual deferred maintenance requests.
President Pitney discussed athletics and previous budget
reductions. She highlighted the concept of putting
athletics on a stable footing, and the advantage of having
competitive athletics as part of UAs identity.
President Pitney discussed revenue assumptions. She
mentioned the 4 percent increase in enrollment, which was
anticipated to continue the next fiscal year. She cited
that UA had applied all the unrestricted revenue to
compensation and fixed cost needs and had requested state
funding for the rest. She noted that the governor's budget
only partially funded the salary and fixed costs with the
General Fund and increased UAs non-General Fund. She
emphasized that UA did not have a source of increasing non-
General Funds that could pay for salaries and fixed costs.
She cited that one of the most important things was for
UAs operating budget to reflect compensation and fixed
cost requests.
10:12:42 AM
President Pitney looked at slide 12, "FY25 Budget Request
Summary":
• FY25 Capital Budget
• Deferred Maintenance and Modernization Strategy
Operating or $60M
• UAF Achieve Research 1 Status (top 4%
nationally) $20M
• UAA Health Workforce Diversity Expansion
Project Phase 2 & Library Learning Commons $6M
($8M total)
• UAS Mariculture Program Expansion $7M ($10M
total)
• Capital project receipt authority for
externally leveraged funds $119.6M
• UAA Alaska Leaders Archive $20M fed
• UAF University Park Early Childhood
Development Center $5.6M fed
• UAF Troth Yeddha' Indigenous Studies
Center $53M fed/other
• UAF Arctic Emergency Services Workforce
Center of Excellence (fire/police/
EMS/dispatch) $38.5M other (grant not
successful)
• UAS Egan Library/Cyril George Indigenous
Knowledge Center $2.5M fed
• Economic Development $12.2M
• UAF Drone Program $10M
• UAF Alaska Railbelt Carbon Capture &
Sequestration Project $2.2M ($11.1M total)
President Pitney commented that UA's capital budget request
somewhat overlapped with its operating budget. She noted
that deferred maintenance had been UAs priority since 1998
when she was budget director. She reiterated the need for
consistency in the funding. She explained that the $20
million for R1 research status was one-time funding and
would be spent over three years to primarily build graduate
and PhD enrollment. She continued that UA had all the
research revenue needed but needed to double PhD graduates
in the following three years. She explained that with the
investment, research revenue would grow and UAF would be
able to sustain the number of graduates.
President Pitney spoke to the health workforce expansion
and the mariculture program expansion, which involved a
classroom in Sitka.
10:16:06 AM
President Pitney continued to address slide 12, and spoke
to the receipt authority for capital projects, for
primarily federal funding. She noted that the grant for UAF
Arctic Emergency Services was not successful, and the
authority was not needed in the current year. In total, UA
was asking for receipt authority to cover projects. She
spoke to economic development projects for drones and match
for Railbelt carbon capture.
Senator Bishop asked about the $11 million for the Railbelt
carbon capture and whether it had been a Department of
Energy award.
President Pitney answered "yes."
President Pitney showed slide 13, "UA FY25 Operating
Budget," which showed a table depicting the UA Board of
Regent's budget compared to the governor's proposed budget.
She pointed out the circled areas on the graph that
highlighted the compensation requests from the two proposed
budgets. The governor had reduced the state funds for
compensation to $6 million from the requested $15 million
and suggested UA cover it with non-state funds. She
emphasized that UA could not generate the proposed level of
non-state funds in the coming year. She emphasized the
importance of having financial stability for compensation
and fixed costs, which allowed for everything else to
happen.
President Pitney mentioned other changes including programs
to support state and Arctic leadership, where the board
requested $6 million in state funds while leveraging $6
million in other funds. None of the requests were accepted.
She referenced slide 20, Programs to Support State and
Arctic Leadership, which showed a table of about 20
different programs related to the request.
10:20:11 AM
President Pitney continued to address slide 13 and
discussed the reduction of tuition assistance for the
Alaska National Guard. She surmised that the intention of
the reduction was a true-up for the use of the funds, which
she thought were being transferred to the Alaska National
Guard for use for other education opportunities. The
funding had been maintained for the program and held
harmless through previous reductions. She highlighted the
$200,000 for the Alaska Center for Energy and Power
Initiatives to continue the energy work group meetings that
had been taking place.
Ms. Pitney pointed out the circle on the bottom of the
table, which showed Technical Vocational Education Program
(TVEP) funding. She contended that if the TVEP program was
not re-authorized, it signified $6 million of technical
vocational educational programming funding to UA. She used
the example of practical nurse-assistant funding, the
process technology program, construction technology,
aviation maintenance, and vocational education start-ups.
She noted that community campuses and vocational education
programs at UAs main campuses provided 90 percent of the
vocational technical education not associated with union
apprenticeships. She descried the funding as critical.
Co-Chair Stedman asked for more detail on the proposed $11
million for compensation. He asked if the funding included
any hollow receipt authority. He asked about the fund
source.
President Pitney relayed that the amount did not have a
revenue source and was "hollow," which signified that UA
would have to reduce programs and adjust in order to find
the $9 million materialize. She thought the reduction would
largely result in less people because UA did not have the
revenue stream. It was expected that UA could earn $7
million in tuition enrollment and indirect cost recovery
that were allowable to use for general costs. The funding
was applied in the boards budget request. She emphasized
that getting to $21 million was not possible.
10:23:57 AM
President Pitney referenced slide 14, "State appropriations
(UGF) are the base on which all programs operate - programs
generate all other revenue," which showed a table depicting
funding sources. She discussed state funds, which were the
primary base for UA funding, and unrestricted funds, which
were able to be used to apply to fixed costs. She
emphasized that the designated/restricted funds included
sources such as federal grants and auxiliaries could not
cover the same costs. She explained that the restricted
funds signified work that was being done on behalf of
others, and the general and unrestricted funds had the
ability to move.
President Pitney highlighted that the bottom of the slide
showed interagency transactions, which she characterized as
"double accounting." The receipts were sometimes excess
receipt authority, and UAs operating budget was in the
$815 million range for FY 24.
President Pitney turned to slide 15, "Sources of Earned
Revenue," which showed unrestricted fund sources and
designated and restricted fund sources. She highlighted
student tuition and student fees. She noted that the fees
were directed towards equipment, special classroom space,
or sometimes a fee if there was a great deal of travel
associated with a course. She addressed indirect cost
recovery, which federal grants paid towards facilities and
utilities associated with the grants. She noted that of the
$40 million of the university receipts was from UAs
Natural Resources Fund contribution, while the remaining
funds were from event tickets, unrestricted gifts, or
partnership opportunities.
President Pitney noted that the interest income listed was
earned on working capital. She noted that the interest was
normally about $3 million. She identified federal funds and
university receipts from a company that paid for a grant or
contract. She summarized that UA was focused on more
diversification and growth of unrestricted revenue sources
for the revenue base. She mentioned the need for stability
and enrollment growth.
10:29:02 AM
President Pitney considered slide 16, "UA FY25 Systemwide
Operating Cost Increases":
$14.7M Compensation ($17.5M total)
• 2.5% wage increase
• Health benefit increases
$2.6M Increased cost of property insurance premiums
$1.4M Increased investment in IT and cyber security
efforts ($1.7M total)
$2.2M Facilities maintenance increase to preserve
capital assets ($4M total)
$2.4M Increased cost of utilities and contractual
fixed costs ($4.4M total)
President Pitney noted that UA had been able to hold health
benefit costs stable for several years, and the increase
was shoring up the post-Covid bounce on health costs. She
commented that the property insurance premiums had been
going up astronomically with a $2.6 million increase, and
that UA had been looking into self-insurance. She thought
the change would take tremendous time, and UA would still
need the funding to build the self-insurance pool. She
mentioned the possibility of riding the state self-
insurance pool until UA had its own.
Co-Chair Hoffman reminded that the committee had
approximately 30 minutes left in the meeting.
Senator Bishop asked about what underwriters were
indicating as a reason for an increase in premiums. He
recalled that UA had its own fire and police departments.
President Pitney cited that the changes were on the
property side, and mentioned recent large claims for storms
and earthquakes. She noted that insurance companies had
left the state. She offered to provide more information if
needed and noted that the change was significant and K-12
education was facing similar issues.
President Pitney continued to address slide 16 and
mentioned other fixed costs such as investments in IT and
cyber-security. She mentioned the importance of protecting
data and upgrading information and workflow systems for
efficiency. She emphasized that it was critical to continue
to add to facilities maintenance and preventative
maintenance in the operating budget, as well as rising
utilities and contractual fixed costs.
President Pitney displayed slide 17, "Operating Costs," and
noted that the slide provided more detail. She highlighted
the bullets on the bottom of the slide in reference to
Senator Bishop's question about the rising cost of property
insurance:
• economic inflation
• social inflation (e.g., legal system abuse)
• supply chain constraints
• increasing catastrophic weather
10:34:02 AM
President Pitney looked at slide 19, "Deferred Maintenance
and Modernization Strategy":
In lieu of one-time capital funding, UA is pursuing a
legislative strategy (HB236 Rep. Stapp) for
consistent annual state funding to the "University of
Alaska Major Maintenance and Modernization Fund."
A modest revenue stream of $35 million annually would
bring UA greater financial stability, with historical
appropriations and funding levels signifying broad
support by the State of Alaska. In the past three
years, the University has received an average of $15M
in deferred maintenance funding, so the legislation
would require an additional $20M over current spending
levels.
HB236 establishes a UA Major Maintenance and
Modernization Fund and spending would be limited to
projects on UA's approved projects list.
To optimize the impact of the funding, project
financing scenarios would consider cash and debt
payments based on market conditions and the projects
to be funded.
UA accountability measures Include:
• Legislative appropriation power is respected,
including giving proper notice
• Spending will be limited to the project list
• Various funding approaches will be used to achieve
desired outcomes
• Predictable funding stream will allow UA to commit
to no new DM funding request for a 6-year period
• There will be a focus on operating efficiency to
reduce ongoing costs
President Pitney noted that there had been consistency in
supporting deferred maintenance in the period between FY 10
and FY 15, and during that time UA had received $35
million. She cited that it was the only period in which
UAs deferred maintenance had not grown. She mentioned the
governors veto of funding and the boards request for a
plan. She reiterated that with the $35 million in funding
it would be possible to have smaller projects. She noted
that if UA bonded for a larger project, it would have to
come to the legislature for another layer of approval. She
mentioned a project list, which UA would work from and on
which there would be legislative controls.
President Pitney was happy to work with the legislature in
modifying the plan for potentially different legislative
control. She emphasized the need for stability to make
consistent progress using a planned approach.
10:37:29 AM
Senator Kiehl referenced slide 16 and had a question about
IT and cyber security. He asked about $2 million spent on
cyber-security and if the funds were the new total or
incremental spending.
President Pitney relayed that the amount was incremental,
and UA's IT spending was collectively in the range of $50
million. Specific to cyber security in the previous three
years, UA had to raise the level with no specific funding.
The funds had been reallocated due to the risk to all
institutions. She noted there had been no cybersecurity
breaches due to working constantly to mitigate the risk.
Senator Kiehl thought the executive branch had
appropriately asked for some added investments in
cybersecurity. He wanted to compare UAs requests to get an
appropriate sense of scale. Senator Kiehl referenced
compensation addressed on slide 17 and thought there was a
new bargaining unit. He asked about the graduate research
workers and asked if the legislature would be seeing the
contract and monetary terms.
President Pitney hoped that the group would come to
agreement before the end of the legislative session. She
had clarified with both teams that a contract had to be
approved by the executive branch and the legislature before
moving forward. She had received word from the union that
it was not in a rush and did not want the matter to wait
until the following year.
10:40:39 AM
President Pitney addressed slide 20, "Programs to Support
State and Arctic Leadership," and noted that mental health
and campus safety were the first areas of additional need.
The second area consistent with the roadmap was recruitment
and retention support. She explained that UA had been
working to have its environment reflect that of the state
and communities' environments by improving the number of
indigenous students, faculty, and staff. The final category
was focused on specific programs. She listed programs at
UAA including psychology, school counselors, and
engineering project management, which were working with
partners and shoring up funding.
President Pitney discussed programs at UAF including energy
resource engineering, wildlife biology, marine policy, and
healthcare management, which were areas that would have
growing enrollment and a modest amount of base general fund
with support requested. She made note of work in food
security. She discussed UAS mariculture and maritime
training, with one-time funding and a transition to a long-
term base funding approach. She discussed hazard prediction
for the glacial flood outburst in Juneau and leveraging
funds across the state.
President Pitney advanced to slide 21, "Legislative
Priorities."
President Pitney looked at slide 22, "Other Legislative
Priorities":
• Extend education tax credit (SB120, HB144, HB89)
Alaska's Education Tax Credit program allows tax-
paying entities to make charitable contributions to
support education in Alaska. Education Tax Credits
encourage partnerships between education entities and
industry to directly meet workforce needs. Tax credits
have a sunset date of Jan 1, 2025. A multi-year
extension is encouraged.
• Student financial support (SB56 and HB148)
Tool to help with future workforce and keeping them in
Alaska. Legislation improves the notice requirements
and adjusts for inflation with the Alaska Performance
Scholarship (APS).
• TVEP extension (HB55)
Technical Vocational Education Program (TVEP) is up
for reauthorization in FY25. The current sunset is set
for June 30, 2024. A multi-year extension is
encouraged.
President Pitney commented that a slightly revised approach
and moving the sunset date of the education tax credits was
critical for funding. She emphasized the importance of the
Alaska Performance Scholarship (APS) in UA's recruitment
and retention. She cited that 80 percent of UA graduates
were living and working in the state after graduation. For
students that attended school outside the state, only 25
percent returned. She emphasized that keeping students in
the state was a key piece of the states workforce, and the
APS was one of the best tools. She stressed the importance
of early notification for the APS (as proposed in the bill)
as an important recruitment tool.
10:46:53 AM
Co-Chair Stedman asked about TVEP and noted that the
auditor had suggested moving away from the current
structure and changing to a competitive grant program for
fairness. He asked President Pitney to comment.
President Pitney explained that the distribution of the
TVEP funding included 45 percent to the University, some of
which was passed through to the pipeline training center.
The number of students that UA had in its vocational
programs well exceeded the allocation. She continued that
there were criteria for program accountability that UA put
forward in the grant process, and there was regional
distribution and annual reporting to the legislature.
President Pitney described that the current competitive DOL
grant required a great deal of administrative process and
noted that UA was eligible for only one grant. She relayed
that it would be problematic for UA to only be able to have
one application. She noted that UA was responsible for 90
percent of the vocational-technical training in the state.
She described a three year runway for programs with the
funding, which was used for program start-up before
transitioning to an ongoing program with different funding.
She feared it was difficult to design the alternative right
in the time remaining in session.
Senator Bishop noted that his office had a request
regarding the education tax credit, which he thought was in
front of the board for review.
10:50:38 AM
President Pitney spoke to slide 24, "FY24 Supplemental":
Economic Development Projects
• Although the projects are making good progress,
several are projecting a balance at the end of FY24,
thus require an appropriation extension so that the
projects may fulfill the objectives of the funding
• Term year extension from FY24 to FY26
Federal Receipt Authority - $20 million increase may
be needed in FY24
• Normal activity up 5%
• UAA $46 million grant for Homeland Security in the
Arctic
• UAF University Affiliated Research Center operating
funding cap increase from $125 to $200 million
UAA Kenai Peninsula College Roof Repair
• Significant structural issue with Goodrich building
roof
• Engineering report recommends either upgrading or
replacing existing roof trusses
• Pending insurance company coverage determination
President Pitney explained that two years previously, UA
had received one-time funding spread across two years for
economic development projects. The projects had included
mining, mariculture, energy, and drones. She described
shoring up receipt authority for FY 24 and FY 25. She noted
that the Goodrich building at the Kenai Peninsula College
would not be used before it was repaired.
10:53:08 AM
President Pitney noted that slide 25 through slide 29
provided updates on UA's economic development projects. She
wanted to thank the legislature for supporting the projects
and give a status update. She expressed excitement about
the heavy oil recovery project.
President Pitney noted that slide 34, "Regular Employee
Headcount by Funding Source & Annual Change," showed a bar
graph related to UA employment. She highlighted that UA had
more people coming on to work directly funded by UAs
restricted funds.
Co-Chair Hoffman asked if President Pitney had any closing
comments.
President Pitney commented that UA had tremendous momentum.
She emphasized that the workforce needs in the state were
great, and that UA was part of the solution. She stressed
that UA's fiscal stability was critical to continue its
momentum.
Co-Chair Hoffman thanked President Pitney. He noted that a
few years previously, the legislature had put an emphasis
upon nurses and healthcare providers, and UA had responded.
He requested that President Pitney take a second look at
prioritizing the need for teachers in the state. He thought
there were academic issues with teacher recruitment and
retention. He thought UA could help with trying to get more
teachers and work more on recruiting students to enter the
teaching field.
Co-Chair Hoffman discussed the agenda for the following
day.
ADJOURNMENT
10:57:19 AM
The meeting was adjourned at 10:57 a.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| FY25 SFin UA Financial Overview Final 2 20 2024 for UA Senate Finance Subommittee.pdf |
SFIN 2/20/2024 9:00:00 AM |