House passes $6.4 billion operating budget with compromise $2,689 PFD

30
2007

The Alaska House approved the operating budget on Monday, allocating $1.7 billion for $2,689 Permanent Fund dividends for this fall. However, there is a shortfall of about $600 million, which means the budget may need to rely on cuts in the Senate or dipping into the Constitutional Budget Reserve to balance. Using funds from this reserve requires a three-quarters vote from both the House and Senate.

The budget comes to about $6.4 billion. The House minority voted against using the Constitutional Budget Reserve to balance it, and also voted against a $175 million one-year appropriation for education, leaving room and plenty of items for negotiations with the Senate before the constitutional adjournment date of May 17. The Senate will probably tie the Permanent Fund dividend appropriation and education funding to the Constitutional Budget Reserve, forcing the dividend down. Generally, the budget gets hammered out in conference committee at the very end of the legislative session.

“Despite the spring forecast’s less-than-positive revenue projections, the budget we passed today provides for a robust PFD and other essential services like public safety and education,” said House Finance Co-Chair DeLena Johnson of Palmer. “There is no doubt that Alaska needs a comprehensive fiscal plan; in the meantime, this budget strikes a delicate balance between our current situation and the services Alaskans expect and deserve.”

The House vote was largely divided along caucus lines, with the Republican-Bush-led majority voting in favor and Wasilla Republican David Eastman aligning with the Democrat-led caucus against advancing the budget to the Senate. Eastman is not part of either caucus.

“This operating budget puts us one step closer towards a sustainable fiscal plan for the state of Alaska. The looming issue of falling state revenue has cast a shadow over the budgetary process the past few years,” said House Speaker Cathy Tilton of Wasilla. “This budget – along with the fiscal working group and the thorough work of the House Ways and Means committee – shines a light at the end of the tunnel. I am excited to see the meaningful steps this body will continue to take towards a more stable and predictable fiscal future.”

HB 39 and the Mental Health Budget, HB 41, move to the Senate for a month of deliberation. On the Senate side, the liberal-led majority has expressed support for a dividend of $1,300 and permanent increases in school spending through a higher Base Student Allocation, the formula for public school spending..

The $2,700 Permanent Fund dividend approved by the House on Monday is smaller than the amount proposed by Gov. Mike Dunleavy in his budget, which was $3,400 – the full statutory amount, which needs an appropriation of around $2.2 billion. The House dividend plan is closer to the 50-50 split that some have proposed for a new dividend formula, while the Senate plan allocates 75% of Permanent Fund earnings to the government and 25% to PFDs.

Read Gov. Dunleavy’s budget details at this link.

30 COMMENTS

  1. No matter how much the legislature has, they want more. No matter how much they take from us, they want more.

    Don’t fall in love with that PFD amount: it won’t survive the senate.

    • I don’t get this, you complain about oversized budgets and the theft if the PFD, yet you call Eastman grandstanding when he is the only Republican voting against a budget that is oversized, steals half the PFD, and funds baby murder.

  2. Senate Bill 52, the effort to increase the Base Student Allocation (BSA) by $1,000 per student is actually an increase of +$2,000 per student once the $1K goes through the funding formula. Reason: The number of actual students (128,238) goes to 258,568 output from the formula.

  3. With an eye-opening deficit and a respectable dividend, you know that the bozos in the will “negotiate” a smaller pdf to help cover the deficit! This is what they peddle as truth in government.

    • Rewrite: “[Y]ou know that the bozos will “negotiate” a smaller PFD to help cover the deficit! This is what they peddle as truth in government.”

  4. And the mismanagement of funds goes on. So these are the best people we can find and look how irresponsible they are.

  5. I think the legislature is NOT acting to the benefit of ALL Alaskans. If you are working for a private company that doesn’t have a legislator in your pocket in Juneau, you are getting screwed out of tens of thousands in dividends while other Alaskans get free fuel, free electricity, free medical, free airplane tickets, free everything, but it isn’t free. The rest of us are paying for it.

    • Bosk, they’ll compromise thinking that they’ll pull you back into the tent with hot campaign ads and more ranting and raving about all the social ills!

  6. Well, finallly a step in the right direction! Our state needs to curb its spending habits, something the liberals do NOT want to do, but must be done. Kudos to the House for their action on this year’s budget! The Schools will cry, but until the school system puts education first and ends the garbage learning entirely, there should be NO increase in the BSA. I expect the senate will not support this and therefore, the senators who vote for the BSA increase should be ousted next election. We will see if voters have the spine to do that or not.

    • Yes! We all need to watch how these people are voting and oust the the ones that are voting against what we want. The school district does not deserve any more funds. They need to budget what they have just like the rest of us have to do. Same fur the rest of the budget fur Alaska. Stop stealing the PFD!

  7. The Senators should be able to get it back to the Representatives within 48 hours if they are competent; then, the combined committee goes into a room and doesn’t come out again until they have something to give the Governor and signatures. Then please go home. No more regs or statutes you do not obey. We no longer want that “service” from you. Nothing but a budget immediately and defense of the US Constitution on going. If that does not satisfy you; please return to your own businesses.

    • You man, MJ, a state with 735,000 people AND a wildly oversized and grossly bloated government. It is the latter, not the former, that is the bottomless black hole of funds.

  8. I can hear those snakes slithering from all corners of the states! Their M-O is to tie it into some BS made-up issue and at the last minute they all agree to point fingers as to why it failed, its all a ruse.

  9. Haha, Representative Eastman just being his best little Democrat self. When will voters in his district elect a conservative?

    • Why would you vote yes for this budget? It steals half of our PFD, funds baby murder, and continues to be too big. You complain about republicans going to Juneau and screwing us over and then bitch more about the one that is trying to NOT screw you over.

  10. “and the services Alaskans expect and deserve.” Well, down here in Ketchikan we have a couple of botched, over schedule, over budget, ferry ramps to nowhere, two roads to nowhere, one still not finished and one not needed, and the road through town that is the only road the state is responsible to maintain, looks like Craters of the Moon. Lotsa big ferries parked down here too. Evidently we don’t deserve anything and we certainly expected more. “The State” does about as well with infrastructure projects as it does educating your kids.
    I’m not sure how DeLena Johnson knows what I deserve but maybe she and the rest of the circus should spend more time holding those six figure bureaucrats’ feet to the fire before they piss all our money away.

  11. Just more of the same crap we get every year. I agree no extra money to schools. They need to get there act together and do some cutting of there own. Also sell the building there in and downsize and move back to DeBarr or better yet one of the shuttered schools.. Our education system stinks to high Heaven and I don’t blame all the teachers. Don’t care for the new super either. They need to be audited.

  12. With this single vote, legislators appropriated more than $12.5 billion for a state with a population last year of 736,556 (more than $17,000 per Alaskan). It doesn’t include total spend this year, so that number will grow higher even if the senate passed the operating budget as is. And don’t forget that the State of Alaska actually lost money (-$2.2B lower net worth) last year from the prior year.

    Glad to see the Democrats adopt the conservative position on this vote. Think it’ll hold? Not a chance.

    Only in the Twilight Zone of Juneau does deficit spending and the passing of a clearly unsustainable (and also partly-unfunded) budget “move us closer to sustainability”. If you’ll buy that I’ve got some oceanfront property in Arizona for you.

    How did this complete abandonment of fiscal responsibility become the “Republican” position? Taxes here we come.

    • Anyone who thinks that Democrats have adopted the conservative position when it comes to fiscal sanity is clearly schlepping for the Democrats. Oh, what do you know here we find Representative Eastman carrying water for the Democrats once again. Just like when he helped them out when they abandoned the House to avoid doing their jobs, just like he does on almost every vote.

  13. In the summer tourists come up here and throw money at the state.. the years and years of exporting natural resources… the fishing… then on top of that the amount of federal money we receive. How possibly can the state be broke? How embarrassing to be an Alaskan.

    • Loren A., euphemistically stated, Alaska has always been a brothel–hookers in the house, hookers in the senate, hookers in the governor’s office, hookers in the streets, hookers wherever you turn! Good for you if you won’t be “woke,” but open your eyes; maybe your mind will follow!

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