As expected, it’s been a challenging legislative session, and from here on, the budget will be the forefront of every discussion. Both the House and the Senate are creating Alaska’s budget, but it’s clear that the bodies have differing approaches.
Last week, I wrote a letter explaining the House approach to resolving Alaska’s fiscal crisis. To recap, the House proposed budget is $81.7 million in General Funds less than our current fiscal year. State agencies have been reduced by $62 million. Despite these cuts, the House Majority Coalition, of which I am a part, is united in protecting vital services, like education, Pioneer Homes, and the Alaska Marine Highway System. In regards to revenue, we are also working on polishing an oil tax credit reform bill and a modest school income tax bill.
The Senate unveiled their budget on Monday, April 3. Significant differences between the House and Senate operating budgets are education, senior services, and Alaska Marine Highway System funding.
Their education plan cuts $69 million to the Base Student Allocation (BSA). This action doesn’t solve our fiscal crisis, but merely passes the burden to our local municipalities. Wrangell schools would lose almost $200,000.
The Senate budget reduces funding for Pioneers Homes by $6.5 million or 12.7% in addition to reductions made over the last two years of $3.3 million Unrestricted General Funds. Staff position eliminations would be inevitable, and with less staff, fewer beds would remain open. As beds remain unfilled, revenues associated with an individual’s care – whether private insurance, individual assets, or Medicaid – will also diminish. The true reduction may be closer to $9 million. Continuing to operate all six of our Pioneer Homes throughout Alaska would be nearly impossible.
The Alaska Marine Highway System lost funding under the Senate’s budget: $4.8 million in General Funds was cut. Of that, $4 million is designated as one-time only money, which means that in FY19, the AMHS budget would be $8.8 million less than the current year (FY17).
We have two significantly different budget proposals before us. Let your voice be heard so that legislators will create a final budget that reflects Alaskans’ priorities. My phone number is (907)-247-4672 and email is rep.dan.ortiz@akleg.gov.
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