(3-minute read) TRIMS SPENDING TO SCHOOLS, PUTS IT TOWARD EARTHQUAKE RECOVERY
Today, Gov. Michael Dunleavy introduced his Fiscal Year 2019 Supplemental Budget, which was unusual in that instead of asking for more money for the General Fund, he actually returned money to the fund.
But the supplemental budget he gave the Senate is not all cuts. Here are the top-line details:
Dunleavy’s Office of Management and Budget has pulled back some $20 million that the 2018 Legislature passed that was over and above the “base student allocation,” which is basic funding for schools based on numbers of students enrolled. The money hasn’t been spent yet, and the governor wants to prioritize differently.
It’s not an unheard of move. In 2015, the public school funding was also pulled back, when the Alaska economy crashed along with the price of oil. That was under Gov. Bill Walker.
Dunleavy asked departments to prioritize their current-year spending and return any funds they anticipate not needing between now and July 1, the beginning of the next fiscal year.
The Alaska Gasline Development Agency returned $5 million to the General Fund, because the agency is moving in a different direction, and the Village Public Safety Officer program returned $3 million, because it has so many positions unfilled. This is the third year in a row that it hasn’t needed that $3 million.
The Department of Education returned $2 million from the school bond debt reimbursement program, a savings that came because the bond debt is lower than was anticipated.
The supplemental budget doesn’t return all of that to the General Fund. Ultimately, just $12.5 million goes back to the State purse, between the undesignated funds and designated funds.
Money is being allocated for disasters. Dunleavy is requesting spending for $37 million in earthquake recovery, which will bring in more than $100 million in federal funds.
He also budgeted nearly $8 million in supplemental spending for fire suppression between now and July 1, in anticipation of forest fire season.
The governor allocated $15 million for Medicaid spending, which ballooned over the last year and was short-funded by as much as $70 million in 2018. The new Dunleavy Administration has since been able to whittle that down.
Sen. Tom Begich immediately found fault with the supplemental budget request.
“Last year, the Senate and House put aside partisanship and crafted an education budget that responded to public demand for increased education resources. Local schools and communities have been hit hard with the high cost of energy and the lack of inflation-proofing of our funding formula. The actions of the Governor send our education system backward, something our schools can’t afford.”
Last year, Gov. Bill Walker put forward his supplemental budget, adding $178 million in spending. The Legislature trimmed that back to $110 million in extra spending, mostly for exploding Medicaid costs.
(This story is developing and will be updated.)