Legislative spending soars, Parnell ready to trim budget

Governor promises to give projects the scrutiny legislators didn't

Posted: Sunday, May 16, 2010

The Alaska Legislature is poised to spend $3 billion this year in capital projects - if it gets by the governor's red pen.

The more than $2 billion contribution from the state is a record for recent years, and will go toward funding big, one-time projects around the state. The capital budget also includes about $1 billion in federal money.

The budget was written behind closed doors by powerful legislators, leading to criticism that the process hasn't been transparent enough.

Gov. Sean Parnell complained about the lack of vetting that led to a "bloated" budget, and has said he's willing to make cuts where lawmakers wouldn't.

"They gave it to me to do, and I'm willing to do it," Parnell said.

He said legislators should expect cuts, but hasn't said how much. The budget was decided during the Legislative session, but the final version hasn't yet been sent to the governor's office for review.

"I think everybody admits spending was too high," he said. "In my view, we need to spend less and save more."

Parnell originally proposed a capital budget of $366 million, much of which was targeted to leverage about $1 billion dollars in federal money. He told legislators he left room for them to add some of their own projects, about $100 million worth.

"We exceeded that by one billion," said Sen. Bert Stedman, a Republican from Sitka and co-chair of the Senate Finance Committee, where he was one of the key budget writers within the Legislature.

Senate leadership quickly agreed that Alaska needed to spend more money than Parnell suggested, both for needed projects and the economic boost that construction would provide.

Senate Rules Committee Chairman Charlie Huggins, R-Wasilla, said the budget limitations suggested by Parnell weren't "practical."

"We're going to serve the people of Alaska," with the larger capital budget, Huggins said.

The Legislature first set aside saving, including about $1 billion dollars for education and $400 million to pay back money borrowed from the Constitutional Budget Reserve during previous lean years, said Senate President Gary Stevens, R-Kodiak.

"I'm proud of the amount of money we put into savings," he said.

Parnell after the session acknowledged that the $100 million amount he first proposed for legislative spending could be exceeded as high oil prices brought even more revenue.

"There was some additional revenue that was not available when I submitted the budget," he acknowledged.

Still, he said, the Legislature spent too much.

"They went far beyond that."

The healthy capital budget provides money for projects sought from all around the state, and prevented lawmakers from having to choose only a few projects.

Even Juneau, with two freshman legislators and a minority Democrat in its three-person delegation, received tens of millions in projects, including nearly $10 million to renovate Johnson Youth Center.

"I think Juneau did fairly well this year," said Sen. Dennis Egan, D-Juneau, after the end of his first legislative session.

Lawmakers negotiated funding for projects behind closed doors, releasing details about the budget only shortly before it was to be passed. Stedman said requests were put in for as much as $4 billion in projects, although only a fraction of that was funded.

The process is now more open that it used to be, when such decisions were entirely in the hands of powerful chairmen. Now, all the projects are tracked in an electronic database, though that is only available to legislators.

"It's a vast improvement over what it was several years ago," Stedman said. "There's a lot more transparency than there used to be."

The power of individual senators to direct or block spending in their districts was highlighted earlier this year when Sen. Albert Kookesh made comments about his ability to funnel money to a Prince of Wales community, depending on their response to a lands bill being pursued by the Native corporation he heads.

"I'm the state senator who represents Craig," Kookesh told the city council in January, according to recorded minutes. "I'm not a vindictive person. I see you're going to have your 2010 capital projects on the table here tonight, and who's it going to go to? It's going to go to me and Bill Thomas, who is also a Sealaska board member."

Rep. Thomas of Haines is a member of the powerful House Finance Committee.

Parnell used to be in Stedman's position as a Finance Committee co-chair, and said the process could use even more transparent.

"I think it's a process we can improve," he said.

Former Deputy Revenue Commissioner Steve Porter said that appropriate scrutiny was not given to the capital budget by the legislative process, but that voters share the blame as well.

"There is generally no opposition to spending, even excessive spending, so long as the legislator's constituents receive a portion of the benefit of that excess," Porter wrote on his Alaskan Advocate blog.

Porter proposed what he called the "Red Pen Challenge," in which all the candidates for governor, including Parnell, will have to propose their vetoes by a certain date.

• Contact reporter Pat Forgey at 523-2250 or patrick.forgey@juneauempire.com.

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