Murkowski: Funds to heat villages at the top of his list

Posted: Friday, October 21, 2005

Increasing funding for villages suffering from the rising costs of heating fuel and gasoline will top the governor's rural legislative agenda next session, he said.

In a speech to the Alaska Federation of Natives in Fairbanks on Thursday, Gov. Frank Murkowski said he will ask for a supplemental appropriation to fully fund the state's Power Cost Equalization program for the remainder of this fiscal year and request that lawmakers also fully fund it for the following year.

"I know what's on your minds and clearly it's the high cost of heating oil," he said.

To offset energy costs, the assistance is available to qualifying municipalities. Currently it helps more than 78,000 Alaskans in 182 communities.

During the last session, lawmakers approved $18.75 million in the operating budget for the program, coming up short of the governor's request for $21.5 million.

Murkowski will ask for an additional $3 million when legislators take up the 2006 fiscal year supplemental budget. Last session, the supplemental was approved in March, but the governor said he hopes the next one will be approved as soon as possible.

The governor said he will ask for a larger amount in the 2007 fiscal year budget at $25 million, which will go to a final vote at the end of next year's session.

For a number of years, the program had not been funded up to its maximum level.

Rural areas are paying about twice as much for fuel as what their urban counterparts pay. The governor said in King Salmon fuel costs $4.89 a gallon and gasoline is at $4.49. The same day in Anchorage, diesel was almost half - $2.83, and gasoline was $2.59, he said.

Grants given to residents this year are not buying as much fuel as before. An average grant of $1,200 to an eligible family in Nome two years ago could purchase 650 gallons of heating fuel, Murkowski said. This winter, the same $1,200 buys only 339 gallons.

Many villages also rely on diesel generators for electricity. Gustavus residents are paying some of the highest rates in the state and perhaps the nation at 53 cents per kilowatt hour.

Full funding for the PCE program will mean about $200 more for each household in qualifying communities, according to the governor.

Murkowski said he will also seek $6.5 million for Small Municipality Energy Assistance, a state program, and add $9 million of state money to the federal Low Income Home Energy Assistance program.

An energy bill that passed this summer in Washington, D.C., contains $50 million for energy assistance in Alaska, spread out over 10 years at $5 million each. The funding was given to the Denali Commission.

Murkowski said he will ask the Legislature to match the funding with another $50 million so the state does not have to dip into general state revenues again in the near future. Matching the energy bill is not required to get the funding.

• Andrew Petty can be reached at

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