The Senate Finance Committee voted on Thursday against adding $7 million in funding to replace the school in Kivalina. The additional funds were requested by Governor Bill Walker’s administration.Download AudioThe vilage of Kivalina. (APRN file photo by Joaqlin Estus, KNBA – Anchorage)The committee approved the capital budget for the coming year. The Legislature would appropriate $78 million, under the plan. The federal government would provide $1.3 billion.But Golovin Democratic Senator Donnie Olson was unsuccessful in adding more money for the school.Olson says the money would settle an education lawsuit – known as the Kasayulie case. The plaintiffs argued the Legislature didn’t treat rural schools equally and the state wasn’t fulfilling its obligation.“If there’s not a remedy to what goes on … the issue will only grow more complex and expensive,” Olson said. “It will become messy. It will become difficult to go and handle.”The state initially planned to pay to renovate the school. But instead the state later agreed to pay for a new school in a different location. This would take the school away from the erosion that’s affecting Kivalina, which is on a barrier island near Kotzebue.The administration and lawmakers differ over the right amount for the school. The Legislature appropriated $43 million last year. Eagle River Republican Senator Anna MacKinnon said this satisfies the state’s obligation.“For the last decade, that we’ve argued about this issue – the adults have argued about the issue – the children of Kivalina have been in conditions that they should not be in,” MacKinnon said.The committee passed an amendment proposed by MacKinnon saying that the Legislature has met its obligation.But the administration says the state should pay $7 million more.State budget director Pat Pitney said that without the money, the state could be back in court.“The highest risk the state faces is a lawsuit, and a reopening of all of the rural school funding inequality issues,” Pitney said.The committee voted four to one against Olson’s amendment to add the additional Kivalina school money. It voted by the same margin in favor of MacKinnon’s amendment saying the Legislature met its obligation.The capital budget includes $12.5 million to purchase the Wells Fargo Bank building in Anchorage’s Spenard neighborhood to serve as a legislative information office. The state faces a potential lawsuit over leaving the Downtown LIO.