Breaking down Governor Dunleavy's budget proposal.
Priority #1 for the upcoming legislative session is to increase funding for public education. Priority #2 is to pass legislation to transition to renewable energy along the Railbelt.
Last week, Alaska Governor Mike Dunleavy surprised a lot of political observers by proposing a largely status quo state budget for the next fiscal year that begins on July 1, 2024. The budget will change significantly as it moves through the legislative process but I am confident the Senate and the House work diligently to come up with the best budget for the people of Alaska.
“We must continue to emphasize the importance of fiscal stability and a balanced budget that effectively addresses Alaska's most critical needs. This budget is a starting point, and the Senate will work diligently and effectively through our process to achieve the best budget for Alaskans. As stewards of Alaska's financial future, we must engage in bipartisan collaboration to navigate the challenges ahead to protect our financial resources so future generations have opportunities for success.” - Senate President Gary Stevens
It is important to note that the Governor’s proposed budget does not include any major cuts to essential state services. A budget with no large cuts is a significant development that bodes well for the prospect of passing a good budget that is both fiscally responsible and meets the needs of Alaskans.
One of the most pressing issues that lawmakers will have to deal with when considering the FY 2025 budget is that Governor Dunleavy has proposed using state savings to fill the projected $987 million revenue gap. For far too long, the Constitutional Budget Reserve (CBR), which is the state’s primary savings account, has been used to balance the state budget. As a result, over $18 billion has been withdrawn from the CBR over the last 12 years. This is concerning because the Alaska Constitution requires that money taken out of the CBR be repaid. It is well past time to quit using Alaska’s dwindling savings to prop up the budget and instead pass a sustainable fiscal plan so that we can properly fund the state government and repay the billions borrowed from the CBR.
Below are some of the items included in the Governor’s budget proposal. It is my sincere hope that you will help us develop a good budget for the state of Alaska by participating in the legislative process with a specific emphasis on providing meaningful public testimony when the time comes. You can review the Governor’s FY2025 budget proposal on the website of the Office of Management and Budget.
FY2025 Budget Details
The proposed budget totals $13.9 billion when you include all state and federal funds.
$8.3 million for school construction and major maintenance.
$5 million in perpetuity for the Alyeska Reading Academy and Institute.
$4 million for school construction.
$1.5 million for Teacher Recruitment, Retention, Certification, and Apprenticeship Development.
$1.5 million for continued Career and Technical Education Initiative.
$1 million for a grant program to help school districts put in place hunter education, gun safety, and archery programs.
$3.5 million to hire 10 additional Villiage Public Safety Officers.
$698,500 for 3 new State Troopers in Bethel to help with investigations of crimes against children.
4 new investigators with the Alaska State Troopers focused on investigating cases of missing and murdered Indigenous persons.
$1.1 million for the Alaska Broadband Office to move forward on broadband projects.
$8.8 million to hire 30 additional state employees to process Public Assistance applications (please note, in FY2022 the Governor cut 100 positions from Public Assistance).
$3 million for Alaska food banks and food pantries.
$5.5 million for staff recruitment and retention in the Department of Corrections.
$23 million to help pay for a new state ferry to replace the Tustamena.
$25 million for Alaska Housing and Finance Corporation Downpayment Assistance Grants.
$6.1 million for pay increases for faculty and staff at the University of Alaska.
Increasing education funding is my #1 priority.
Thankfully, Governor Dunleavy’s proposed budget for FY2025 includes $1.26 billion to fund Alaska's K-12 public education system according to the established foundation formula. That is the good news; however, the bad news is that inflation continues to eat away at the buying power of our school districts, which means that even with a status-quo budget, school districts will have less money to hire good teachers and give our children and young adults the tools and resources they need to be successful.
Right now, school districts are struggling to recruit and retain teachers and other skilled educators because they simply do not have the money to pay them a truly competitive salary. Teachers are leaving Alaska for better opportunities elsewhere. This is unacceptable and must change.
Obviously, we need more money to operate our schools and we need more money in the classrooms. That’s why I, and many others, are working to pass a significant increase in the Base Student Allocation (BSA). A BSA increase will give school districts the resources they need to improve public education, including increasing teacher pay.
During the 2023 legislative session, the Education and Finance Committees in the State Senate heard compelling testimony from parents, students, teachers, and school board members that Alaska is failing to meet its constitutional obligation regarding public education. I fear that the future of Alaska’s children and young adults is being hampered by the inability of the Alaska Legislature to pass legislation to significantly increase the BSA.
During the 2023 legislative session, the Senate did its part by passing legislation to increase the BSA by $680, which would be the largest single BSA increase in state history. The legislation is now being considered by the Alaska House of Representatives and I hope that the House will vote on the legislation early in the upcoming legislative session so we can give parents, students, and teachers confidence that their neighborhood school won’t close and their favorite teachers will be retained.
Transitioning to renewable energy is priority #2.
On December 18, Alaska Common Ground held a lively discussion about the renewable energy legislation under consideration by the Alaska State Legislature. I was happy to join my colleagues Sen. James Kauffman, Rep. Genevieve Mina, and Rep. Calvin Schrage to talk about renewable energy. If you missed the forum, it is available to watch at your convenience on YouTube.
Specifically, I was invited to Monday night’s event to talk about the bill I am sponsoring to spur electric utilities along Alaska’s Railbelt to transition to renewable energy. Senate Bill 101 calls for 25% of the Railbelt electricity to come from renewable energy sources by the end of 2027. Right now, that figure is about 15%. A Renewable Portfolio Standard (RPS) would set a gradual increase in the amount of electricity coming from renewable sources until the utilities reach a combined target of 80% by the end of 2040.
I am committed to passing an RPS bill during the 2024 legislative session because encouraging renewable energy generation is the best long-term option for the State of Alaska. As I tried to detail during my opening comments at the Alaska Common Ground forum, which you can listen to below, electricity diversification is needed in the wake of dire warnings about climate change and the hair-brained idea of importing liquefied natural gas to meet the needs of Southcentral Alaska.
Happy Kwanzaa, Merry Christmas, Happy Hanukkah, and a joyful holiday season to all.
There is a lot of bad news in the world right now. I wish I had the omnipotent ability to infuse the world with kindness for one another, but unfortunately, that is not within my power.
As my family prepares to celebrate the lighting of the first Kwanzaa candle, I find myself reflecting on the seven principles of Kwanzaa and the memories of my mother and grandmother. May we all remember to find unity in our shared humanity, engage in authentic and transformational self-determination, remind ourselves of our shared responsibility and collective work, build and maintain our shared economic vitality, live with purpose and creativity, and sustain our faith in the face of hate and discrimination.
In the coming days, it is important to treat people with kindness. Whether it is a loving word or extending a hand in friendship, it is a time to be courteous to someone who needs it. The nights are long and we need one another more now than ever before. None of this may not take the weight off your shoulders, but it just might take the weight off theirs.
May this season bring hope, light, and love to you and yours. I am wishing you all the best from my small family to yours (not pictured is our dog, Ranger).
