By SHANNON HAUGLAND
Sentinel Staff Writer
Sen. Bert Stedman says he is pleased that this year’s legislative session, and a 24-hour special session, have ended with a balanced budget, a “reasonable-size” PFD, and additional funding for schools.
None of those accomplishments was in sight Wednesday when the House adjourned its regular session, or when the special session called by Gov. Dunleavy began Thursday morning.
“This is the first time in several years the budget has been balanced,” Stedman told the Sentinel today from Petersburg. “It would’ve been balanced last year, but we didn’t have the run of the Senate floor so we took measures so it wouldn’t happen again.”
Stedman is a co-chair of the Senate finance committee and a member of the Senate majority, which includes Republicans and Democrats.
The biggest achievement this year is a balanced budget, without drawing on savings, he said. Until the start of the special session Thursday the House and Senate were at an impasse mainly over the size of the Permanent Fund Dividend, and whether to draw down the Constitutional Budget Reserve for a higher dividend.
Stedman favored a 75-25 split, dedicating 75 percent to operations in the budget, and 25 to the dividend. House members favored a 50-50 split. The House position would have cost $1.7 billion.
“But there was no way we could cash flow,” he said. “And the Senate, we wanted a balanced budget, and we don’t want deficit spending. So we produced a 75-25 split: which is a $1,300 (permanent fund) dividend.”
The version approved will also mean an $84 million surplus; the budget favored by the House would have resulted in a $800 million draw from the CBR.
“Running those deficits, we would be in a position where we could possibly lose the dividend or have a dividend that’s just minuscule,” Stedman said.
The budget also includes a one-time $170 million increase for school funding. It’s a 14 percent increase for education, but does not represent a permanent increase in the base student allocation.
“The BSA itself is under review, to increase that. That is under statute and that is in the works,” Stedman said. The Senate sent a proposed BSA increase to the House, “and we’ll see what they do next year. There is more data coming from individual school districts to the Department of Education so we can better refine what the BSA should actually be so we’re not re-adjusting in the dark. Funding this year could become the new base number.”
On the capital expense side of the budget the Legislature concentrated funds on deferred maintenance and matching fund programs.
“There’s not a lot; the Senate did not put in individual projects,” Stedman said. “We were fighting with the House not to do that, and to concentrate on statewide major maintenance issues, including schools, buildings, roads and the university. We were unable to agree on that – we had an additional 24 district projects added by the House to the budget yesterday to conclude the session.”
Stedman added that $5 million was proposed toward the electrification of cruise ships. “We’ll start moving that forward, and we’ll benefit from that,” he said, adding that Ketchikan has already started adding infrastructure toward that goal.
“Sitka’s on the radar, Ketchikan, Juneau and Skagway,” Stedman said. “This is just the beginning of the endeavor to get cruise ships plugged in and on hydro, and to get their generators shut down (while in port).”
Stedman thinks the governor will sign the budget, with some adjustments.
With the special session behind him, Stedman is looking ahead to fall, when the governor may call a special session on “a fiscal plan for the state (which) means taxes to be able to pay a bigger dividend.”
“I’m not too excited about that, but we’ll see how it goes,” Stedman said.
Other work is needed on education issues such as the BSA, teacher salaries and the teachers retirement system, he said.
Stedman said he is also looking forward to a summer with no special sessions, for the first time in three years.
