Panel releases draft budget

Posted: Tuesday, May 03, 2005

The Senate Finance Committee has released a new capital budget draft that adds $395 million in state general fund spending if a separate bill paying for the projects with Alaska Permanent Fund earnings fails to pass the House.

The size of the budget proposal has not been totaled by the staff of state Sen. Lyda Green, R-Wasilla, but it figures to be significantly larger than previous years because of the latest addition. More amendments to the budget were to be introduced today.

Green, the Senate Finance Committee co-chairwoman, is responsible for the capital budget. Ginger Blaisdell, her aide in charge of the capital budget, said the draft was put together from multiple sources and projects were still coming in.

The proposal, released Monday, adds contingency language that if Senate Bill 155 fails, the projects in that bill would be included in the capital budget and paid for with general funds.

Neither Green nor Senate President Ben Stevens, R-Anchorage, were available for comment Monday. Stevens is the sponsor of Senate Bill 155.

Senate Bill 155 would add nearly $400 million in school and higher education construction projects and wipe out the state's deferred maintenance list for schools. Most lawmakers favor the projects, but several had problems with the funding source - the earnings reserve account of the permanent fund.

"I think everybody was OK with the projects of Senate Bill 155," said House Finance Co-Chairman Kevin Meyer, R-Anchorage, in whose committee the bill now sits. "The permanent fund earnings would have caused some problems."

The fate of Stevens' bill was unclear with the introduction of the substitute capital budget bill.

It was uncertain whether Stevens' bill has the support of a majority of members in the House Finance Committee. House Speaker John Harris, R-Valdez, has said he believes a slim majority in the full House would approve the measure.

House Majority Leader John Coghill, R-North Pole, said he was not surprised the Senate added the contingency language, given the reluctance of the House to move on Stevens' bill.

"I don't think we've given them any good reason to" trust Senate Bill 155 would pass the House, he said.

The ballooning capital budget could be paid for with a combination of money from the state general fund, federal money, bonds and a special account within the permanent fund that does not affect the dividend program.

The funding source for some of the projects, including the schools projects and Gov. Frank Murkowski's roads package, are still uncertain and depend on other bills now moving through the Legislature.

The bills are Senate Bills 46 and 155.

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