The Alaska House has debated the state budget and, as the representative for southern Southeast, helping to create the budget is one of my main duties. There were some amendments in the House Finance Committee that are encouraging: We increased funding to Head Start, public radio, the multi-state WWAMI medical program to accommodate 10 more Alaska students, dive fisheries assessments, and community-based grants through the Division of Senior and Disabilities Services.
My biggest issue with the current budget is that there is a significant deficit of at least $600 million. I will be the first to admit we were dealt a tough hand; our main sources of revenue — oil revenue and investment returns on the Permanent Fund — are both down this year.
That being said, our minority coalition and I offered multiple amendments to help fill that deficit, most of which were voted down. We proposed an amendment to split the percent-of-market-value draw on the Permanent Fund, with 75% going to state services and 25% going to the dividend. That solution would balance the budget, provide a $1,300 PFD this year and generate millions of dollars in savings, but it did not pass.
I also proposed an amendment that would decrease the amount of tax credit payments the state pays to oil companies, which did pass.
Education funding became the talking point of the budget debate.
We passed a one-year increase to the base student allocation (state funding for local school districts), with strings attached. It will require a three-quarters vote of the body to pass.
Although I am grateful for that potential increase, I am also weary of the instability. Schools are not guaranteed that money until we finalize the budget, which is not enough time for them to make changes to their budget to reflect that increase. It is also only a one-year increase. We need a long-term plan for schools, which is why I’m still hopeful that my bill — House Bill 65 — will pass and guarantee a higher funding formula for all years going into the future.
The primary debate is how to pay for public services and a dividend. I have a short survey to get your input on the biggest budget issue. You can find it in this week’s Wrangell Sentinel or online at https://www.surveymonkey.com/r/OrtizBudget2023.
Overall, the state budget is similar to last year’s budget, but fell short on multiple issues facing Alaskans, such as child care shortages, the opioid crisis and lack of affordable housing.
Rep. Dan Ortiz
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