The threat to UA’s financial situation came at the beginning of this month after planned cuts to the university by the state government totalling US$5 million as part of the 2020 budget were suddenly altered by Alaska Governor Michael Dunleavy, via the use of a line-item veto, resulting in a 41% budget reduction to the university system, representing more than US$135 million.
The decision immediately threw UA’s budget into turmoil, with likely closings of some smaller campuses as well as layoffs and cancellation of some programs, in addition to an eventual exodus of staff and students, given the lack of comparable alternative employment options in the state. An editorial by UA President Jim Johnsen, called for an override of the veto, stating that in addition to the immediate effects of the funding losses, ‘ripple effects’ would appear which would further damage the post-secondary educational system in Alaska, as well as the economy of the state itself.
The University of Alaska system, which includes campuses in Anchorage, Fairbanks and Juneau, along with satellite campuses and community centres elsewhere in the state, has over 26,000 students enrolled, employs twelve hundred faculty members, and is a centre for Arctic research, including indigenous studies, local language courses, geo-physical and environmental sciences and general northern studies. UA’s Anchorage and Fairbanks campuses are also members of the UArctic research network, which brings together academic and research institutions from across the circumpolar north and internationally to share research on Arctic studies.
In a stinging critique in The Guardian, it was suggested the negative effects of the cuts and the precarious economic future of UA would be especially felt in more isolated communities, including those with indigenous student populations. There was also the question of long-term harm to needed US Arctic research, including on climate change at a time when its effects are starting to become ever more visible in the Arctic, (Alaska itself has been beset by wildfires this summer, coupled with record high temperatures), and an administration in Washington which continues a policy of overt climate change denial. UA is now facing a potential brain drain as a result of layoffs and the shutting down of programmes and possibly entire campuses, which would adversely affect not only Arctic research in Alaska but also partnerships with other global institutions.
Governor Dunleavy entered office in December last year with a promise to begin austerity measures in Alaska in the wake of the longest recession in the state’s history, sparked by the rapid drop in oil prices since 2015. He has also been adamant about providing Alaskans with a larger share of the state’s Permanent Fund, which had been set up in 1976 to manage the state’s oil and gas revenues, while at the same time reducing public services. Critics, however, have argued that such sharp cuts, including to UA, would likely push the state into an even deeper financial morass.
It was also announced this week that the credit rating of UA had been reduced three levels from A1 to Baa1 by the fiscal services firm, Moody’s, reflecting concerns about the university’s ability to meet its financial commitments, thus making the institution the lowest rated of its type in the United States. According to a new press release from UA, the ratings situation may improve should financial exigency measures be undertaken.
At a time when the United States appears to be drastically redefining its Arctic policies, the looming financial crisis at UA, which is now questioning whether its academic accreditation can be maintained under current circumstances, would be a major blow not only to US Arctic research but also to the reputation of the country as an Arctic actor. Washington has also shown signs of deviating its policies from those of its Arctic neighbours, as evidenced by recent condemnations of Russian and Chinese policies in the region, as well as its steadfast refusal to view climate change as an environmental and human security emergency. The possible marginalisation or even loss of the UA system would send out another signal that the United States is retreating from the Arctic at a time when, as the line goes, attention must be paid.
Addendum: On 22 July, the University of Alaska’s board of regents voted 10-1 in favour of declaring financial exigency, with some of the regents noting that unless serious actions were taken to reduce costs, UA will be out of funds by February 2020.
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