Senate approves $1.8 billion budget

Posted: Thursday, April 03, 2008

The state Senate on Wednesday approved a $1.8 billion capital budget, and sent it to the House Finance Committee for its review.

The budget, approved on a 15-5 vote by the Senate, quickly drew criticism from Gov. Sarah Palin, who said the Senate omitted vital projects such as:

• $5 million for repairs to the 415-mile long Dalton Highway, the road that leads from Fairbanks to the North Slope.

• $1 million for statewide bridge repairs that were not eligible for federal funds.

• $92 million for statewide deferred maintenance on state-owned facilities.

"I thought it was appalling," Palin said. "They are not frivolous things. These are life, safety, basic solid infrastructure projects that we believe must be restored."

Senate Finance Committee co-Chairman Bert Stedman, R-Sitka, countered the budget represents an effort to save money and send a responsible package to the House.

"When we went through and selected items, there's a limit to the size of the capital budget we wanted," Stedman said. "The House does what the House does and adds to the capital budget, so I was a little hesitant to have a capital budget over $2 billion."

Palin and legislators have been sparring over the level of capital spending, but there is also unfinished business for spending during the current fiscal year, which ends June 30.

As the House begins its review of the capital budget, Palin has just a few days to review the supplemental budget, typically reserved for emergencies and unanticipated needs.

This year's supplemental includes projects previously vetoed by Palin but reinserted by lawmakers. The next move in the budget squabble belongs to Palin, who has promised more vetoes.

Before doing so, however, she asked lawmakers makers to defend their supplemental capital requests with meetings.

Lawmakers have been touting their savings plans, saying they've been on a "savings spree," not a spending spree.

The state expects to reap more than $8 billion in surplus revenues over this fiscal year and next from high oil prices and a new oil production tax. So far they already have set aside $5 billion in 2008 and 2009 state revenues and said they intend to set aside even more later.

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