2001 budget meets GOP's goal of slashing $30 million

Posted: Friday, April 28, 2000

After a week of negotiations and caucusing, a six-member committee of lawmakers finished work Thursday on the state's $6.6 billion operating budget for the 2001 fiscal year.

But the Knowles administration wants to see changes.

For Sen. Sean Parnell, chairman of the conference committee, the budget and its $2.2 billion in state general fund spending is just about right.

The Anchorage Republican said there was enough money for education, public safety, transportation and children's programs to satisfy him and the GOP's effort to cut $30 million in general funds. That cut, he said, includes cuts in the state's other big spending bill, the capital budget.

The GOP legislative majority has some room to spare under its self-imposed spending cap, Parnell said.

``The real number is $30.95 million,'' he said. ``We maintained the priorities we had going in.''

Gov. Tony Knowles, a Democrat, held a brief news conference. He said the Legislature needed to spend more on pre-school education and a few other programs before he'll be happy with the budgets.

The budget conference committee didn't maintain the priority expressed by Knowles and a bipartisan group of House legislators -- the University of Alaska.

The committee's budget included an increase of $8.5 million for the university -- about half of what university President Mark Hamilton asked for. It's also less than the $34 million increase the House was willing to spend over two years.

If money is made available to pay for salary increases at the university, another $5 million could be added to the university's budget for next year, said Rep. John Davies, a Fairbanks Democrat.

``It's too early to know if what we did was the right thing or not,'' he said.

A university spokeswoman, Wendy Redman, said the price of rising fixed costs wasn't addressed by the committee's increase.

``It's half of what we need for this year,'' she said. ``It doesn't cover our salary needs. We'll be working hard in the next week to get those contracts funded.

``Do I think we're going to get it? Yes.''

Davies said the 2001 budget has a couple of problems though it covers basic state services pretty well. One of the major problems, he said, is its reliance on one-time funding sources such as federal grants that won't be available for future legislatures.

``It's a rampant problem in the budget this year,'' he said. ``I haven't added it up yet, but it's millions, tens of millions at least.''

Another problem, he said, is that the budget doesn't really address the state of education in Alaska. ``My district is laying off teachers.''

Parnell said more money was spent on education and children's programs, though not as much as Knowles requested.

Parnell said the budget was fair, and he disagreed with Davies' assertion that the spending plan relied too much on one-time funds. By shifting from state funds to other funds, the state will get more for its money, he said. Besides, Parnell said, such funding happens all the time.

This year, he said, the use of such one-time funding was aimed at areas where the budget was increased. He didn't think future lawmakers would be faced with any bigger budget holes because of this year's spending than was this year's Legislature.

``It's always been that way,'' he said.

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