Sen. Dunleavy Comments on Ongoing State Budget Process

As the Alaska Legislature nears the 100^th day of this year’s session, many questions regarding the state budget and revenue streams remain unanswered. Both the House and Senate have considered a bill to restructure the way Permanent Fund Dividends are calculated. The House has also passed a bill calling for an income tax and another making changes to oil tax credits. The Senate, meanwhile, is looking at deeper cuts in its version of the budget.

If any of the revenue measures currently under consideration pass, Senator Mike Dunleavy  says there are already efforts to remove them via a public referendum.

“If that were to happen…you end up with, obviously no additional revenue streams. So then you’re left with only one choice at that point, and that’s reducing until the reductions get to the point that there’s a consensus across the state that’s there’s enough reductions.”

When he was a member of the Senate Majority, Dunleavy proposed deeper cuts than what ultimately passed the Senate. Still, the Senate’s version of the state operating budget makes significantly more cuts. One area where those proposed cuts are causing concern is education. The senate version of the budget proposes a five-percent cut to education as well as a change to the formula for student funding. Senator Dunleavy believes that particular cut will either diminish or disappear from the final budget compromise.

“You’re going into a discussion with the House, who does not want reductions, so you’re going to end up with an end result either somewhere in between…or quite possibly something closer to zero cut.”

What that final compromise on the budget looks like will remain unknown for some time longer, since the conference committee that will make those decisions has yet to be named while alternate sources of state revenue are considered.