House OKs budget

GOP claims reduction of $26 million next year

Posted: Sunday, March 19, 2000

It's ahead of schedule and smaller than last year's budget bill. But before it was approved in the House, it drew fire from Democrats who said the spending plan was blind to Alaska's future.

The House's version of the budget to pay for state agencies and services was approved on a 23-14 House vote Friday. It's scheduled to come up for consideration in Senate committee next week. The budget spends about $2.1 billion in general funds, about $26 million less than the current fiscal year's budget, according to Rep. Eldon Mulder, an Anchorage Republican and co-chairman of the House Finance Committee.

With the cut, the GOP majority is close to cutting $30 million this year, which would complete its five-year goal to slash $250 million of general funds, he said.

``It's conservative, responsible but it's responsive,'' Mulder said of the measure. He said there were some things he plans to work on this year, such as finding a way to get more money to the University of Alaska.

Proposals in the works would make the budget look better nearer the end of the legislative session, according to Mulder.

``We need to show opportunity to Alaska's future,'' he said. ``Our vision needs to focus on the education of our children.''

Rep. John Davies, a Fairbanks Democrat, said the 2001 operating budget shows a state with a crumbling foundation held together with chipped mortar.

``This budget is missing some big pieces,'' he said, saying there was not enough money for the University of Alaska and municipal aid programs. Also, he said, other costs were ignored, such as the close to $23 million expected cost of new contracts with state employees.

``These are all big holes in the structure we want to build - the future of Alaska,'' Davies said. ``We don't have a vision of the future that is hopeful.''

Following floor debate, the operating budget bill passed with one minority Republican voting along with Democrats. A few minutes later, a two-thirds vote to allow for a draw from state savings to cover the difference between the cost of the budget and available state revenue failed.

The budget bill next goes to the Senate, which will change the measure, and then to a probable conference committee where a final budget will be hammered out. Then the measure will go to Gov. Tony Knowles. The Democrat had proposed a spending plan calling for nearly $100 million more than the budget passed by the House.

Rep. Andrew Halcro, an Anchorage Republican, voted for the plan, but not before chiding his cohorts about being afraid of finding new ways to pay for state spending.

Halcro said he'd been criticized by fellow GOP lawmakers for holding hearings on raising the state's gas tax, which is currently the smallest in the nation. He also was scolded for hiring two legislative staffers rather than the three allowed.

Some legislators, he said, were thinking about votes in their districts rather than the health and vitality of Alaska.

``Stop being worried about re-election and worry about reality,'' he said.

Several majority lawmakers stood to say the state needed to find a way to generate more money - a long-term fiscal plan.

After 14 years of sitting through debate on the state's operating budget, Rep. Bill Hudson, a Juneau Republican, stood to speak.

``There's something missing,'' he said. What's not on the table, he said, was a proposal that will put state revenues in line with state spending. The 2001 budget, he said, once again relies on draining money - somewhere near $700 million - from state savings accounts. If that continues, he warned, those accounts will drain and, eventually, legislators will dip into earnings of the Alaska Permanent Fund. Soon thereafter, Hudson said, state dividends will stop coming in the mail.

``We are hell-bent on moving the permanent fund dividend to history,'' Hudson said.

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