Alaska is in a fiscal mess and Gov. Mike Dunleavy is making it worse.
The state has spent almost all of its easily accessible savings. Budget cuts have hit hard at essentials such as the ferry system, university and some social service programs. Our credit rating is at risk. And yet the governor acts like next year or the year after is soon enough to figure it out.
Calm and thoughtful is good, irresponsible is bad.
Dunleavy's plan is to spend from the Permanent Fund until a better idea comes along. Just take billions of dollars more from fund earnings to plug budget gaps and pay super-sized dividends this spring, in the fall and next year, too.
No new revenues, he says, until voters get to decide on a tax-blocking constitutional amendment in 2022. The governor won't even give his support to a legislative effort to raise motor fuel taxes for the first time in half a century to help pay for highway maintenance.
No scaling back the annual Permanent Fund dividend until two more votes - a special election this year and another constitutional amendment vote in 2022 - according to the governor's calendar.
Even the governor's revenue commissioner acknowledged in testimony at the House Finance Committee last week that a wait-until-after-2022 calendar does nothing to balance the budget this year or next.
Turn the page of the Dunleavy calendar and every month says, Spend from the Permanent Fund.
"I recognize that the timeline doesn't work. However, the governor is not supportive of any new tax without the vote of the people, so I guess what that means is that we would just be spending into the ERA (Permanent Fund earnings reserve account) to fund any deficit balances in the future," Commissioner Lucinda Mahoney told the House Finance Committee.
A member of the committee, Fairbanks Rep. Steve Thompson, asked the commissioner: "If we have no taxes for revenue and more money coming out to pay a larger dividend, does that sound like a disaster in the making?"
Mahoney gave half an answer: "I think it sounds like it's a situation where we all need to educate Alaskans in regard to our fiscal condition. So that they understand that large dividends with deficit spending puts us, long term, in a very difficult situation."
Maybe the commissioner needs to educate the governor. He seems to think large dividends, no taxes, and overdrawing from the Permanent Fund is not so difficult.
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