May 23, 2025
Legislature Adjourns: UA Operating, Supplemental, and Capital Budgets Heading to the Governor; Other Bills Affecting UA Wait Until 2026
Operating, Supplemental, and Capital Budgets Moving Forward
The 2025 legislative session ended one day early on the afternoon of Tuesday, May 20 after lawmakers in both the Senate and House approved a compromise version of the budget, House Bill 53 (HB 53), which rolled the FY26 operating budget with the FY25 supplemental budget. The conference committee on HB 53, which is made up of three members from the House and three from the Senate, worked through the various differences between their budgets, before sending the final completed product to their respective floors for a vote.
Initial Differences in House and Senate Versions of the Operating Budget get Resolved
The House version of the operating budget included funding for a number of requests put forth by the University of Alaska, while the Senate version rejected all FY26 requests from UA except for partial funding for employee compensation increases. Ultimately, the conference committee only accepted the funding for fixed costs from the House budget, while rejecting the rest. The Senate’s version of the budget on compensation was accepted. Therefore, the following UA increments made it in the final operating budget passed by the legislature:
- $17.2 million for employee compensation increases
- $3.7 million for fixed cost increases
Why did this occur?
Much like the other agencies seeking state funding this year, the decrease in revenue and overall challenging fiscal picture contributed to the lack of funding for items in the university’s budget request. Lower oil prices (with an expectation of low oil prices in the future), uncertain federal fiscal policy, tariffs, and an appetite to save for what may be a more challenging year in FY27 all contributed to the budget we see today.
The operating budget (combined with the supplemental budget) will next go to the governor’s desk for consideration, where he can exercise his line-item veto authority if he so chooses.
The capital budget, which was concurred with by the Senate on May 16, is also heading to the Governor’s desk. Of note, the capital budget includes $10 million of the Board’s $60 million request for critical deferred maintenance projects across the UA system.
Notable Bills to Watch in Preparation for the 2026 Legislative Session
There are a few notable bills worthy of review in the months ahead. The UA is a focus, or has been a part of the conversation, in all of these bills. Please follow the links for a complete listing of all publicly available information:
- House Bill 10 (HB10) - By Rep. Carrick - "An Act relating to the Board of Regents of the University of Alaska." - In the Senate Finance Committee.
- House Bill 28 (HB28) - By Rep. Story - "An Act establishing a student loan repayment pilot program." - In the Senate Education Committee.
- House Bill 29 (HB29) - By Rep. Vance - "An Act relating to group insurance coverage and self-insurance coverage for school district employees, employees of the University of Alaska, and employees of other governmental units in the state." - In the House Education Committee (SB5 is Senate equivalent from Senator Hughes - In the Senate Education Committee).
- House Bill 176 (HB176) - By Rep. Carrick - "An Act relating to notice of new fees and fee increases from the University of Alaska; relating to billing statements from the University of Alaska."- In the House Rules Committee (SB157 is Senate equivalent from Senator Myers - In the Senate Education Committee).
- House Bill 30 (HB30) - By Rep. Holland - "An Act establishing the office of entrepreneurship; relating to new businesses in the state; relating to reports concerning procurements by agencies; and relating to initial business license fees for new businesses in the state." - In the House Finance Committee.
- House Bill 34 (HB34) - By Rep. Holland - "An Act establishing the Alaska Innovation Council; and relating to financial disclosures for members of the Alaska Innovation Council." - In the House Finance Committee.
- Senate Bill 140 (SB140) - By Sen. Stedman - "An Act relating to a matching grant program for fire station construction and renovation." - In the Senate Finance Committee.
- Senate Bill 181 (SB181) - By Sen. Stevens - "An Act relating to disclosure of information obtained by the Department of Labor and Workforce Development to other state agencies." - In the Senate Labor and Commerce Committee.
Katie McCall and I appreciate all the voices across the UA system. It’s a great privilege to work with all of you and we look forward to the work ahead.
For more information, contact Director of State Relations for the University of Alaska System Chad Hutchison, cell 907-378-3946, email clhutchison@alaska.edu. You can also follow the University of Alaska Government Relations on our Twitter page.