By SHANNON HAUGLAND
Sentinel Staff Writer
Sen. Bert Stedman says the governor’s just-released 2021 budget indicates there will be a more orderly process for the Legislature in its budget deliberations in the upcoming session.
“I’ve had several conversations with the governor,” said Stedman, Senate Finance Committee co-chair, who represents Sitka and communities around Southeast. “I’m glad he put forth a budget that’s basically flat funding/status quo. We’ll be working with departments through the budget process to see what expenditures can be reduced, and what is attainable.”
Gov. Mike Dunleavy’s budget calls for a draw-down of $1.5 billion from the constitutional budget reserve, leaving a balance of $500 million.
“It’s an insufficient amount of cash for the state to have on hand to cash flow ongoing operations,” Stedman said Thursday from Washington, D.C., where he was working on state oil and gas issues.
Stedman said the challenge for the state is to balance the Permanent Fund Dividend payout, with budgetary reductions that can be achieved, and without overdrawing the Permanent Fund earnings.
“The three of those are intertwined, and we’ve got to balance those in the process,” he said.
There are advocates emphasizing each of those positions, which must be brought into balance, he said.
“There’s some groups that demand a $3,000 dividend and they’re not concerned about the ramifications,” he said. “There are others who think the priority of protecting the Permanent Fund and not overdrawing it – and that’s where I’m at – is more important than the other ramifications, and there’s some that would as soon massacre the budget, expenditure-wise, and try to fulfill all the other obligations. ... We’ll just work through it.”
He expects his committee will take a “measured approach” to address all three areas, and balance the needs of all Alaskans.
“Within that, have a robust conversation about protecting the Permanent Fund for future generations and not overdrawing it,” he said. “I expect the finance committee to have a robust conversation ... about increasing the constitutionally protected portion of the Permanent Fund.”
He said he’s concerned about the Legislature’s draining the unprotected portion of the fund, the earnings reserve.
Highlighting a few areas of particular local concern in the upcoming session, Stedman said the governor’s proposal shows flat funding in the base student allocation for education, and increases in reading skills resources.
Stedman said he is concerned about a timely renewal of the U.S. Coast Guard certificate for the mainline ferry Malaspina before it expires; and is determined to secure funding to reopen Mt. Edgecumbe aquatic center, and obtain receipt authority. The receipt authority would allow the facility to obtain income by charging fees for non-school users, such as the Coast Guard, the Public Safety Academy and the general public.
He said he also will seek an operating subsidy for the pool in the general fund. He noted that other projects around the state that were funded by the same bond issue that financed the Mt. Edgecumbe pool are already receiving subsidies, and pool is entitled to that funding as well.
“We are still in need of a small general fund subsidy for the pool, in cash,” he said. “We’re asking to be treated fairly with the other projects.”
Stedman also is looking for additional funding for the Alaska Marine Highway System for the current year, which runs through June 30, and for the next year as well.
But Stedman concluded that he’s hoping for a smoother process in the Legislature this year, in light of the more measured spending proposal advanced by the governor. The senator said this is a marked contrast to the radical cutbacks proposed by Dunleavy last year, which led to a protracted battle with the Legislature.
“I think it will lead to a more meaningful and cordial dialog on how we put the budget together and a better budget for the public,” Stedman said.
The Sitka legislator said he’s keeping his eye on a number of issues of statewide as well as regional importance, and will know more as he becomes more familiar with the details of the budget in the coming weeks.
