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Legislature finishes up operating budget

$21M for schools put in capital budget

Posted: April 14, 2013 - 8:34pm  |  Updated: April 14, 2013 - 11:03pm
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Senate Finance Committee Co-Charman Pete Kelly, R-Fairbanks, speaks about the state's operating budget before its passage in the senate on a 19-1 vote on Sunday.  Michael Penn / Juneau Empire
Michael Penn / Juneau Empire
Senate Finance Committee Co-Charman Pete Kelly, R-Fairbanks, speaks about the state's operating budget before its passage in the senate on a 19-1 vote on Sunday.

The Alaska State Legislature fulfilled its constitutional duty Sunday as the House of Representatives and Senate passed a state operating budget.

The state operating budget was developed by a conference committee of legislators from both bodies appointed to bridge differences between the more conservative House budget and the more generous Senate budget. Lawmakers voted to accept the conference committee report Sunday, adopting that $9.86 billion version of the budget.

At press time, the House and Senate had yet to pass a capital budget, which funds a variety of projects throughout the state.

The version of the capital budget produced by the House Finance Committee Sunday was slightly different from the version unveiled Saturday night. Staff made technical updates and added a few projects House Finance Co-Chairman Bill Stoltze, R-Chugiak, said had been accidentally left off the Saturday version, and legislators approved several amendments to the capital budget.

Stoltze and other majority members of the House Finance Committee offered the most major amendment, appropriating $21 million for distribution as capital grants to Alaska’s school districts. The grants are intended to go toward “student safety and security enhancements,” as well as to energy relief and other fixed costs in smaller school districts.

Rep. Lindsey Holmes, R-Anchorage, said there are schools in the Anchorage School District that need safety improvements — but, as Stoltze noted, the language is somewhat flexible.

“I would read this language broadly, Mr. Chairman, and I think it’s a really good way to get some additional money to our schools,” Holmes said.

Rep. Alan Austerman, R-Kodiak, the committee’s other co-chairman, emphasized Stoltze’s description of the $21 million as one-time funding.

“It’s not to be considered part of the operating budget,” said Austerman.

The operating budget includes a one-time $25 million item for schools as well.

Minority Democrats, bolstered by public testimony, rallies and cross-caucus agreement with some majority legislators, made education funding a central rallying cry during the legislative session.

While the final budget does not contain an increase to the Base Student Allocation, a central piece of the education funding formula, as several lawmakers had wanted, the late addition of $21 million does give school districts more money to work with in the next fiscal year.

The Juneau School District stands to receive $764,146 as its share of the $21 million item, according to a table attached to the amendment.

The House Finance Committee also took public testimony on the capital budget before it moved out of committee, although just a fraction of that testimony was given in-person.

Skagway businesswoman Janice Wrentmore voiced opposition to funding for the Juneau Access Road, a project that would extend Juneau’s road system north to Katzehin.

“In this time of declining revenues, the project creates a huge unfunded balance and our concern is that it’s going to drain much-needed monies from our local districts,” Wrentmore said, noting that the total project cost is estimated to be substantially more than what is budgeted for it this year.

The capital budget contains nearly $10 million for the Juneau Access Road — a combination of general fund money and reappropriated funds.

Juneau Mayor Merrill Sanford — who was elected last year on a platform that included support for “the Road,” as it is commonly known in the capital city — testified to affirm the Borough Assembly’s backing of the controversial project, which is in legal limbo since a court invalidated its environmental impact statement in 2009.

“I’m just here to reassure you that there’s plenty of people, and the majority of our Assembly, that want to see Juneau Access built,” Sanford said. “And we’re trying to move forward and get those dollars in the budget so that we’re ready to go when we get out of the court system. So Juneau Access, yes please.”

The mayor of Ketchikan, testifying by telephone, thanked the committee for adding $5 million more for additions and alterations to the PeaceHealth Ketchikan Medical Center, which now has a $15 million allocation in the budget.

“We are looking to not only just have funding from the state,” said Mayor Lew Williams III, noting that the project is the “top priority” for the Ketchikan area. “As the city of Ketchikan, we are going to contribute $38 million in bonds supported by local sales tax — our revenues. So we’re looking at it as something that we’re going to be contributing to, and we just thank you for your support.”

Other funding items for Southeast Alaska projects in the budget — whether by general fund allocations, unspent funds reappropriated from other projects or some combination of the two — include $20 million for the State Library Archives Museum project in the Willoughby District, $7.25 million for Alaska State Capitol renovations, $3.9 million for a new Petersburg police station and jail, $3 million for the Snow Removal Equipment Facility at Juneau International Airport, $2.15 million for Petersburg Elementary School construction, and $1 million for a new Marine Exchange of Alaska building in Juneau, among others.

Several other transportation projects, including ferry terminal improvements, state airport upgrades and road improvements, in Juneau and outlying communities are also funded in the capital budget.

Although he said he supports “the Road,” Juneau Democratic Sen. Dennis Egan said he would have preferred to see the money marked for that project go toward an area frequently cited as a community need in the capital city.

“I would have been more pleased if we took that money and put it in housing right now,” said Egan. He added, “I am pro-Road, but I wasn’t going to die on the sword for it. I was trying to get other things back in.”

But, Egan said, “In the scheme of things, we fared well, I think. We fared O.K. You have to remember all the cuts. It’s not just Juneau.”

Both the capital budget and the operating budget are among the smallest the state has passed in recent years.

“This budget is $87.3 million lower than the governor’s amended general fund budget,” said Austerman on the House floor Sunday evening. “So I think we did quite well in the long term, setting things up for what it’s going to look like in the future and letting people know that we’re serious about trying to get … balance in our budget and maintain a sustainable budget.”

The enacted version of the operating budget will include fiscal notes from bills the Legislature has passed that require state spending.

• Contact reporter Mark D. Miller at 586-1821 or at mark.d.miller@juneauempire.com.

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