The governor had a chance to talk honestly about taxes when he announced his 10-year budget plan last month. He had a second chance Jan. 28 with his State of the State speech.
Sadly, he failed both times.
The governor's 10-year fiscal plan acknowledges there will be a $1.2 billion hole in the state budget 18 months from now. That's equal to more than 20% of public services and Permanent Fund dividends the next year. And that's after spending down the state's savings for much of the past 30 years and after overdrawing Permanent Fund earnings this year.
It's important and urgent that Alaskans solve it now, wouldn't you think?
Yet all Gov. Mike Dunleavy could offer to cover that $1.2 billion was three words in his budget plan: "Other revenue sources."
No honesty about the inevitability of state taxes, which Alaskans haven't paid in more than two generations. It's as if some magical, painless revenue sources will appear in 18 months.
Then, as if he had been holding an ace up his sleeve, the governor in his State of the State said he would support legislation "to bring gaming to Alaska." That's it? Alaska is short $1.2 billion for schools, the state ferries, the university, troopers and everything else, and other than the routine talk of more oil, a mythical North Slope natural gas pipeline and how the federal government is bad for Alaska, all he could summon was a vision of casino gaming?
The most recent credible estimate for public revenues from a statewide lottery came in at $15 million, about 1% of the budget gap. That was from a 2015 Alaska Department of Revenue report which did not look at casinos, only a lottery. Either way, it's a small number for a big problem.
The governor could have worked harder at telling Alaskans the truth about the impending $1.2 billion crevasse. In total, he devoted 70 words of his 3,770-word speech to gambling. He said nothing about what much of the Legislature is discussing: A state income tax or a state sales tax, either of which could fill one-third to one-half of the revenue gap.
Dunleavy is in his third year in the job, his third year of trying to close the budget gap that is hurting our communities, and his best cut of the deck is to tell us legalized gambling is a winning hand?
To make it worse, the governor continues to promote his proposed constitutional amendment that would prohibit any new taxes without a vote of the people. But since that constitutional amendment, even if approved by the Legislature, could not go before votes until the next general election in November 2022, just how does Dunleavy think $1.2 billion in magic money will appear starting July 2022 when his voter permission slip would not come until months later?
The calendar, just like his budget math, does not add up.
- Wrangell Sentinel
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