On Monday, State Senator Mike Dunleavy, whose district includes the Susitna Valley, attended the Talkeetna Community Council meeting to hear the concerns of Upper Valley voters. In addition, he sat down with KTNA’s Phillip Manning to discuss the upcoming legislative session.
In two weeks, the Alaska State Legislature will convene for its 2016 session. Senator Mike Dunleavy says that Alaskans should expect significant cuts to the state’s budget, especially since continuing drops in the price of oil mean less revenue for the state.
“I think we’re going to be looking at $500 million to $1 billion, and the reason I say that is from May to today we lost $600 million in revenue. We thought it was bad last year. We lost $600 million when it went from $64 a barrel to $38, so the hole keeps getting bigger. It doesn’t get smaller.”
Senator Dunleavy sits on the Senate Finance Committee and chairs the Education Committee. He says that the biggest drivers of state spending are education and the Department of Health and Social Services, and that cuts may extend to those as well.
“Those reductions…may be touching education; they may be touching health and social services; they may be touching things like the ferry. They may be touching a whole host of things that have to be looked at.”
In addition to deeper cuts, a number of plans have been discussed for increasing the state’s revenue, ranging from personal income tax and sales tax to various methods of utilizing the Permanent Fund. Dunleavy believes that using the Earnings Reserve Account of the Permanent Fund could keep government running at a reduced level without impacting Permanent Fund Dividend checks.
“It’s outside the corpus—the body of the Permanent Fund—and its intent was to be used for this purpose. That’s why it doesn’t need a supermajority, and that’s why it’s not a constitutionally protected aspect of the fund.”
Senator Dunleavy says he expects budget discussions to be contentious, and that it is likely to extend the normal time limit for the legislative session.
“This is probably going to take more than ninety days, because all of these have to be looked at very, very carefully before the trigger is pulled on them, but I do believe we can get where we need to go, in my opinion, at this stage of the game, without instituting and income tax or taxes on the backs of Alaskans.”
Last May, Senator Dunleavy told the Alaska Dispatch News that he was considering running for the U.S. Senate seat currently occupied by Senator Lisa Murkowski. Now, he says that he wants to focus on the issues in front of the Alaska Legislature and will not run against Murkowski this year.
“We’ve got too many things we have to deal with in the State of Alaska. And I’ve got to be honest with you, you can’t take your eye off the ball in this situation for a second. So, I would be doing a disservice, I think, to the people of Alaska [and] myself to do anything other than focus on what we have to do here in Alaska.”
The Alaska Legislature begins its session on January 19th.