JUNEAU (AP) -- The Senate Finance Committee approved an $8.5 million increase for the University of Alaska late Wednesday, tapping two unusual sources for the money.
Most of the increase -- about $6.5 million, would come from a surplus in the money the state is sending to local school districts in the current fiscal year. When the new fiscal year begins July 1, that money would be transferred to the university.
The remaining $2 million would come from the proceeds of the state's student loan program.
University of Alaska President Mark Hamilton had requested a $16.9 million increase to the system's budget, which currently includes $172 million from the state's general fund.
The increase included in the operating budget for the coming fiscal year does not deal with a $5.1 million increase in university employee contracts because lawmakers plan to address the cost of several new state employee contracts separately.
However, it also left off about $3.2 million the university requested to cover other fixed cost increases such as inflation, utilities and repairs to facilities.
''It's wonderful,'' said Wendy Redman, the school's vice president for university relations. ''But they left about three and a half million dollars of our top priorities off.''
Sen. Sean Parnell, the co-chairman of the committee, introduced the novel money switch as an alternative when Sen. Gary Wilken, R-Fairbanks, tried to restore the entire $16.9 million.
After briefly objecting, Wilken agreed to the switch, saying he would use the rest of the Legislature's session to try to win more money for the university.
By tapping the education surplus and the student loan fund, the committee was able to pay for the increase without making the state's general fund budget any larger. The Legislature's GOP majority is trying to reduce general fund spending by $30 million in the next fiscal year.
Parnell's proposal was adopted 7-2 by the committee. Sen. Al Adams, the committee's lone Democrat, held out for the full $16.9 million increase, but Sen. Randy Phillips objected to using the education surplus for the university.
Phillips, R-Eagle River, said the money, which was freed up by lower-than-expected school enrollment, should have been redirected to another program in basic education. The money had been earmarked for education and other children's programs in Gov. Tony Knowles proposed supplemental budget for the current fiscal year.
The university money was one of only a handful of amendments approved on Wednesday. Most of the proposed changes were offered by Adams, D-Kotzebue, and voted down on 1-9 party-line votes.
The House has already passed a version of the operating budget that contains no increase for the university
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