A positive step forward for the state's finances

Posted: Tuesday, July 03, 2001

The following editorial was published June 28 by Alaska Newspapers Inc.

Kudos to the state lawmakers who are promoting the Fiscal Policy Caucus.

Motivated by an expected budgetary shortfall of about $1 billion by fiscal year 2005 - and the inability of legislative leaders to find solutions - the bipartisan group is taking the state's financial dilemma to the public.

Should a tax on the cruise ship industry make up the difference? Should the state extract more money from North Slope oil revenues? Will a property tax do the trick, or can the state bureaucracy be streamlined?

You decide. In a series of town meetings, the caucus will ask Alaska residents to find the answers their elected officials can't.

The effort is an important first step, and the 30-member group should be lauded for being frank about the legislative remiss that could one day bring the state to the brink of bankruptcy.

The public would be wise to get behind the effort. Within the next four years, the $2.9 billion budget reserve may be all but wiped out. The state's only pocket to draw from could be the $5.7 billion Alaska Permanent Fund earnings reserve, an option Alaskans don't want.

The town meetings must include rural Alaska, which has the most to lose when resources dwindle. Even recent history shows that legislators aren't afraid to balance the budget on the backs of rural Alaskans.

This past session alone, legislators tried to cut out state education funding for the North Slope and eliminate a budget item that funds nonprofit organizations. And some of the budget-balancing bills introduced by Senate Finance Committee Co-chairman Dave Donley, R-Anchorage, would take money from rural Alaska.

Donley and other leaders have failed, and they know it. Most Republican majority leaders haven't supported the caucus, including House Speaker Brian Porter, R-Anchorage, and House Finance Committee Co-chairman Eldon Mulder, R-Anchorage.

They can't fix the problem, but perhaps the people will.



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