Alaska School Trust Lands and Fund
In the 1915 Alaska Enabling Act, two square miles in every territorial township when surveyed were granted to Alaska schools. A township is a square parcel that is 6 miles on a side, with 36 one-mile squares in each township. Schools were to get two one-mile squares per township. The grant would have been over 20 million acres to support schools if all of Alaska had been surveyed. Title to only 104,000 acres was transferred to schools.
Instead, when Alaska was admitted to the United States on January 3, 1959, the state took all the lands previously granted in a “lump sum of donated lands and to equally divide the revenue from these lands to all individual groups.”[1] The income from this land was to be put in the Public School Trust fund with earnings to go to the public schools. Then in 1978 the Alaska State Legislature re-designated all school lands to become general state grant land. To replace the income source for the Public School Trust Fund, the legislature specified that the fund would receive one-half of one percent of receipts from the general grant lands. In 1980 the Alaska National Interest Lands Conservation Act (ANILCA) granted Alaska 75,000 additional acres of school land. This new land was in lieu of land Alaska was entitled to at statehood, though a pretty poor exchange as the original grant would have been 20 million acres. By 1992, 74,930 acres had been selected.
In 1999 in Kasayulie v. State of Alaska, the State was found to have breached the school land trust in 1978 by (1) re-designating school land to be general grant land, and (2) failing to properly use and account for school trust funds. No remedy was stipulated by the court, which called for an appraisal of former school lands. No appraisal had been conducted as of 2013. Another suit, Citizen’s Alliance Protecting School Lands vs, State of Alaska was filed in the Superior Court First Judicial District at Juneau in 2013 to recover all lands granted to schools.
Each fiscal year, the Commissioner of Revenue transfers to the Public School Trust Fund “a sum equal to one-half of one per cent (0.5%) of the total receipts derived from the management of state land, including amounts paid to the state as proceeds of sale or annual rent of surface rights, mineral lease rentals, royalties, royalty sale proceeds, and federal mineral revenue-sharing payments or bonuses.”
These state and school trust lands are managed by the Alaska Department of Natural Resources under the leadership of Commissioner John Boyle. They are located in the Robert B. Atwood Building at 550 West 7th Avenue, Suite 1300 in Anchorage. Their phone is (907) 269-8431.
Annual Revenue Credited to Alaska School Trust Fund
The Public School Trust Fund is then invested by the Commissioner of Revenue with the approval of the Public School Fund Advisory Board composed of the Commissioner of Education, three members elected by the Board of Education from among its members, and the Commissioner of Revenue.
The Public School Trust is invested by the Commissioner of Revenue Adam Crum located at 333 Willoughby Avenue, Suite 11, in Juneau. His office can be reached at (907) 465-2300.
Alaska School Trust Fund Market Value
The 5-year return is 6.42%. The asset allocation is as follows:
Domestic Equity Pool 39%
Broad Market Fixed Income Pool 30%
International 25%
Real Estate Investment Trust Pool 5%
By law the capital gains stay in the principal of the Public School Trust Fund to grow the fund to continue to have an impact on Alaska’s school children.
Most important is the revenue to schools. Annually the legislature can appropriate up to 5% of a 5-year running monthly average to schools.
Alaska Annual Distributions to Schools
In FY 2022 the distribution to schools was $15.6 million which was half of the prior year distribution. That is a significant payment given that Alaska schools have only 131,587 students k-12. The per pupil distribution was over $118 per student in FY 2022.
[1] See legal notes on the Alaska Enabling Act, Proclamation No. 3269.