Spending plans pass despite concerns over amount
Published Sunday, April 13, 2008
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Stumble It!JUNEAU — State lawmakers approved a spending plan for operating expenses Saturday that majority and minority members alike described as simply unsustainable.
“Some of the things we’re promising, we’re going to have to take away,” Rep. Mike Kelly, R-Fairbanks, said during a floor debate on the bill.
The House also approved a budget for capital projects totaling $2.7 billion despite concerns from some members that the cash influx would overheat the state’s economy. That bill still needs formal approval in the Senate.
A third spending bill authorizing the state to issue $315 million in bonds for transportation projects passed the Senate but still needs approval in the House.
The three bills were the last major items still in play in the legislative session, which ends tonight.
Unsustainable growth
The operating budget approved Saturday appropriates a total of $11.2 billion, including more than $5 billion in state general funds.
It increases agency spending by less than 4 percent over last year but boosts overall spending of state funds by more than 23 percent, according to a legislative analysis.
The higher total stems from new oil production tax credits, a direct deposit to pay down the state’s retirement system debt, and increased funding for K-12 education, among other things.
Floor debate on the bill focused on the overall increase.
“We can’t sustain it,” said Rep. Ralph Samuels, an Anchorage Republican and the majority leader. “It will not work, and Alaskans will suffer.”
Kelly and Samuels both said they considered voting against the budget despite the stiff penalty for majority members for not supporting it.
Other majority members also criticized the budget, but all of them voted for it.
The budget passed 33-6, with six Democrats voting against it.
In the Senate, the budget passed 15-5, with all five members of the Republican minority voting against it.
Senate Finance Committee co-chair Lyman Hoffman, D-Bethel, noted that the spending plan actually included $1 billion in savings.
But he also described the budget growth as unsustainable.
“We need to continue to look for a long-term solution to balancing the budget until we come to first gas,” he said.
Sen. Joe Thomas, D-Fairbanks, said later that he and others tried hard to curb the budget growth and added that a certain amount of growth was needed to maintain current services.
Gov. Sarah Palin said she would scrutinize the budget, but she suggested the jump in spending shouldn’t be seen as a jump in bureaucracy.
One of the largest increases is for oil production tax credits, she noted, one part of a new tax that has also increased state revenues.
Overflowing capital budget
The capital budget approved in the House spends a total of $2.7 billion, including $1.2 billion in state general funds.
Rep. Kevin Meyer, R-Anchorage, the co-chair of the House Finance Committee responsible for the capital budget, said the spending would make roads and water supplies safer, improve the quality of life for Alaskans and increase recreational opportunities in the state.
“When you consider all the things we’ve added and all the things we’ve done, I think this is a good budget,” he said.
Floor debate focused on the wisdom of spending more in years of budget surplus and whether funding lots of construction projects at once would overheat the state’s economy.
Rep. David Guttenberg, a Fairbanks Democrat and former construction worker, argued the hefty budget would lead to another boom and bust cycle.
“My concern is it’s overflowing,” he said.
Rep. Mike Chenault, a Republican from Nikiski and co-chair of the House Finance Committee, said he didn’t think it was necessarily bad to spark a boom, even if it meant that workers from outside Alaska were doing the work — that’s how his parents came to Alaska decades ago, he said.
“Maybe one of the good things is that it does bring people up here,” he said. “And hopefully they fall in love with this land.”
The House approved the bill 33-6, with only minority Democrats voting against it.
Palin expressed concern at the overall size of the budget and the threat of overheating the economy, and she said she would look for projects that could be put off a year to spread out the new money.
Palin said she will work with lawmakers to evaluate individual projects, but suggested she would cut some.
“We will put a lot of effort into scrutinizing every project,” she said.
Community Discussion
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Did I read that correctly 11.2 BILLION??
The government is running amok. I guess we should all be thankful that the big spending D's were not in charge.
I'm scratching my head over the comment from the Kenai legislator. He thinks we need more people living here. Is there a shortage I wasn't aware of?
If the plan is to get more people here maybe we should get more land into the private sector. Already seems crowded to me…. Trouble is they come up here to work but send the money home. With economy in the lower 48 at a low point there will be plenty of boomers coming here just because of the news of a gas line.
So what's new? Just a bunch of excuses. People live above their means and think they deserve it. Pass the cost on to the future. People used to sacrifice so their kids would have a better way of life. Not any more.
Total spending is $27,500 per Alaskan and a whopping $58,000 per Alaska worker. Out of this windfall the legislature was kind enough to give us $300 million dollars, or 1% of the budget to address the #1 issue of rising energy costs. Because we Alaskans can not be trusted to spend this money on energy related expenses it is going to be distributed to low-income programs for weatherization. So, your neighbor down the street on welfare is going to get new windows and high-efficiency furnace while working ALaskans choose between heat or food or moving elsewhere.
Out of $27,500 per person spent they would not even advance an energy rebate bill of $650 to committee. It's a good thing that we can't drive to Juneau because there would probably be a riot in front of the capitol.
Well I'm scratching my head over Kevin Meyer's explanation of improving our quality of life (defined by legislators?!) and all these recreational opportunities that I suppose we don't otherwise have.
These guys are so out of touch. We really need to move the capitol.
The money is ours. The windfall should be shared with us. People can call it government handouts/subsidies or whatever they want. They are wrong.
Don't blame me. (Or call me a commie/socialist etc.). I didn't write the Alaska Constitution.
Alaska is rolling in the dough. The dough is ours.
Why should we settle for "our share" as merely a dividend from a bunch of investments, dependent on entities (mostly) entirely apart from the actual money coming in, during these hard times?
Many, and likely most, don't trust the government to use/spend the money wisely.
Yet they advocate anything but a flat cash share of the booty.
That indicates those people would prefer the gov spend all our money rather than we, as individuals, using at least some of it for what we think best for ourselves.
On April 7, under the "end of legislature" article, commenter kbmanley had the best proposals I've heard yet. They were:
Energy Relief Bill
Everyone gets a shot in the arm by setting up an account with a fuel/energy company and money gets put there for energy needs.
Economic Stimulus Package
We all get a share of OUR money to spend how we see fit.
Now, I know that it is believed (and I think true) that, for example, college costs rise because the gov helps subsidize it.
I think a scenario such as that could be easily worked out.
It would also be a quick and fair fix while we figure out something else.
The legislators talk about creating a boom. That's the same as economic stimulus. We should all get to participate in it--not just those they choose for us.
It's our dough.
Fairbanksgas-
Apparently while you were posting, I was digging for that April 7 article I mentioned.
In 2001 I had "help" from Interior Weatherization--the local agency that will get part of the $300 mil.
The workers were not qualified, and, as I later discovered, this is no secret in the local carpenters world.
The damage that outfit caused to my home (which they acknowledged to some degree) will cost many thousands--thousands that I don't have-- to fix.
They told me years ago that if I could get someone to fix it, they would provide materials. I couldn't get someone to work for free or even reduced cost.
If I had my share of the resources which are part mine, I would fix my house and it would be way more energy efficient.
For those who will say that was my share--getting my roof wrecked--forget it. You have no idea. Anyway, it was to move my old wood stove to a better place. No new windows. No boiler. Just my old, inefficient wood stove.
In late 2006 I sold property for $25 K with payments to be made to, primarily, my energy bills and property taxes. I figured it would at least keep us in a home.
The property was paid off. I was refused energy assistance because they said I had no bills because someone else paid them. Go figure.
I have not and will not apply for cash welfare.
Maybe next time just prior to voting on energy assistance for all Alaskans through rebates.
Those in favor should turn on the AC or reduce the thermostat to the lowest setting possible the night before.
On a table they should provide blankets with paper work requiring they show they are below the poverty level to get a blanket.
Another table should be set up with blankets, gloves, jackets with a sign that indicates this table for those in favor of keeping everyone warm...
Fairbanksgas: Lets save the trip to Juneau and invite the Governor and the Alaska Legislature to Fairbanks for the upcoming SPECIAL SESSION. And if they don't want to come; we can start the initiative petition and/or court proceedings.
ALASKA CONSTITUTION, Declaration of Rights, Section 1.2 Source of Government. "All political power in inherent in the people. All government originates with the people, is found upon their well only, and is instituted solely for the good of the people as a whole."
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