Last Friday, Governor Dunleavy released his proposed budget for the 2022 Fiscal Year (FY22). The budget, which includes all departments and services but not the PFD, totals $3.81 billion in Unrestricted General Funds. It is slightly less than this past budget (FY21), which was approximately $3.83 billion. The primary difference is that FY21 included one-time COVID-19 funding in the Department of Health and Social Services that is not included in this upcoming year's budget. FY22 also has a smaller Education budget by $26.8 million because enrollment numbers are down due to COVID-19.
The Governor's other proposed cuts include an additional $2.5 million cut to the Alaska Marine Highway System and $20 million cut to the University. The Governor also proposed a supplemental PFD (to be distributed as early as March) and a full PFD for the FY22 budget that would cost a combined total of $3.2 billion. Based on our projected revenue from oil and the statutory formula for withdrawing funds from the Earnings Reserve, we only have enough to cover the operating budget, which doesn't include the PFD.
Therefore, the Governor suggested that we pay the dividend by taking an additional $3.2 billion from the
Permanent Fund Earnings Reserve, well beyond the statutory $3 billion we plan to draw. The Governor's budget is just the starting place. The Legislature, as the appropriating body, will take into consideration his proposal and work towards a finished product when we go into session in January. I plan on creating a survey in the near future to hear from you. In the meantime, feel free to share your input by emailing me at Rep.Dan.Ortiz@AKLeg.gov or calling my office at (907) 247-4672.
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