Despite strides forward in recent months, the Juneau Access Project has now met a roadblock that can’t be overcome easily. It didn’t make Gov. Bill Walker’s pared-down capital budget, and Senate President Kevin Meyer, R-Anchorage, said the Senate majority doesn’t see the project as a funding priority in the upcoming legislative session.
Facing a $3.5 billion budget deficit, Walker released a fiscal year 2016 capital budget of $106 million in state general funds — a decrease of $114 million from former Gov. Sean Parnell’s suggested budget.
Of the projects included in Walker’s list, most belong to the Department of Transportation, but the decades-old Juneau Road project, which would connect Juneau indirectly to Alaska’s road system and cost an estimated $574 million in state and federal funds, didn’t make the cut.
Juneau projects that did make it include water treatment plant improvements, Egan and Riverside drive intersection improvements, Glacier Highway reconstruction, and Industrial Boulevard widening and sidewalk installation, although the last three projects are funded only with federal dollars. Few projects in Walker’s capital budget are to be funded with actual state money; the federal government gives the state a billion dollars for capital projects each year if the state can match the funding by 10 percent.
Walker said during his campaign that he would look at every large project as a potential place to cut state spending, including Juneau access.
“We have to get our fiscal house in order and decide what stays and goes,” he said when asked about the Road during a September interview.
Walker spokeswoman Grace Jang said in an email that the Road project could be included in the final version of the capital budget due Feb. 18 if the governor decides it’s worth funding in the deficit.
“The Juneau Access Road is a very large project,” she said. “The transition team asked us to evaluate all megaprojects before moving forward.”
Meyer said the Senate majority, which met last weekend for a pre-Legislature retreat in Girdwood, agrees with Walker’s capital budget. The Republican-led majority’s priority is to balance the budget as well as it can, and a lean capital budget is part of that, he said.
“We all know we have to reduce the budget and we all know there is a pretty large deficit,” Meyer said. “We’re trying to reduce our deficit. We’re always going to have a deficit (in FY 2016); there’s no way we can reduce the budget by $3.5 billion.”
Funding the Road did not come up during the retreat, Meyer said.
“It’s not in the governor’s budget; I don’t think there’s that much interest in bringing that up again this session,” he said. “Now, under our current financial situation, it probably isn’t going to be a high priority.”
The Legislature funded the Road at $35 million during its most recent session. So far, the project has been funded at $48 million in state general funds and $154 million in federal dollars, DOT spokesman Jeremy Woodrow said.
Although “the whole status of that road and the road extension is still unknown,” Meyer said he doesn’t anticipate the Legislature will “move that money around” to unfund the project.
While “approving funds for a project would show that there is intent for the project to move forward,” Woodrow said DOT doesn’t expect the project going unfunded in the FY 2016 budget to set it back. Army Corps of Engineers permitting is moving forward, and the department has past Road allocations from the state and federal government to work from. Since the project began, DOT has spent $36 million on the Road — in predesign studies, environmental impact statements and staff time — $28 million of which was federal money.
Ultimately, the state needs to dedicate $9 million more in general funds in order for it to get the federal match it needs to be completed.
“But we don’t need that all in one year,” Woodrow said. “That could be given over numerous years.”
DOT will move forward with the Juneau Access Project process until directed otherwise by the governor, he said.
During its retreat, the Senate majority met with Walker about his plans for the state.
“He stayed for almost an hour and a half,” Meyer said. “We asked him questions and he told us what his vision was for Alaska. It was a good discussion.”
Walker told the senators he plans to cut from every state department to slim down the operating budget.
“He’s going to suggest to all his departments a 5 percent reduction across the board,” Meyer said. “When he was running for office, he said 16 percent, but I think he soon realized that would be devastating not only to our government services but to our economy.”
Other legislative priorities for the Senate majority include establishing Alaska leadership in Arctic research and policy, honing Alaska’s public education system and solidifying a plan for the liquefied natural gas pipe line.
“That’s still a really big unknown,” Meyer said of the LNG project. “We’re just afraid if (Walker) makes a whole lot of changes to what’s currently being proposed, it could be set back significantly and nobody wants that, obviously.”
• Contact reporter Katie Moritz at 523-2294 or at email@example.com. Follow her on Twitter @katecmoritz.