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Budget surplus should lower blood pressures

Posted: Sunday, December 19, 2004

Vantage Point By Robert Hale, publisher of the Juneau Empire.

One of the best parts of the state's 2006 budget, as outlined by Gov. Frank Murkowski last week, is the $127 million in additional funding for education over the next two years, along with the $82 million increase that the Legislature provided for education last year. The 2006 budget makes that increase permanent.

Murkowski's plans for the '06 budget year, which will begin next July 1, are based on a projected revenue windfall of $653 million courtesy of the high price of oil. Overall, the governor's plan is to spend a little more than half of that money over the next three years ('05, '06 and '07) and set the rest aside for future budget deficits. That's a great plan, assuming oil prices remain in the stratosphere.

Murkowski's two-year proposal for education covers grades K-12 and would allow school districts to do a much better job of planning their budgets, staffing needs and the requirements of their schools. That's a smart approach, and if the state does see the kind of revenue windfall the governor expects, it makes sense for education to head the list as expenses are budgeted. Health care should be next.

Less than a month before the 2005 legislative session gets under way, Murkowski and the state's lawmakers should have the table set for more agreement than in the past three or four years. That's all based, however, on the sense of security created by this year's high oil prices which, according to the state's department of revenue, are expected to last through next June.

That's in stark contrast to this time a year ago, when the governor and both houses of the Legislature were fretting over what they feared would become close to a $1 billion budget deficit. Moving from that possibility to a surplus of $653 million should do a lot to lower everybody's blood pressure.

Not all legislators, however, are convinced the oil boom is long-lived, Republican Rep. Bruce Weyhrauch of Juneau and Democratic Rep. Eric Croft of Anchorage among them. That means the governor's package of budget proposals, which includes $81 million over the next two years to aid cities in paying retirement costs for public employees, $28 million for promotion of the construction of a natural gas pipeline, and $4.5 million for substance-abuse prevention, will face opposition from those who see the measures as overly optimistic.

With any substantial budget surplus, next year's legislative session should easily be as much a boom as last year's session was a bust. Based on an abysmal 2004 session, lawmakers wouldn't have to work hard at all to accomplish more by the end of February than got done in all of last year's session.

It'll be interesting to see how well Murkowski leads next year, and to see which members of the Legislature emerge as leaders. 2005 could be the pivotal point in Murkowski's time in office, and it appears the time is right for him to show the state what he's made of.

• Robert Hale is publisher of the Juneau Empire. He can be reached at robert.hale@juneauempire.com.



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