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Governor Hopeful for Budget Agreements

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Location: Juneau, AK


Governor Hopeful for Budget Agreements

April 15, 2009, Juneau, Alaska - Governor Sarah Palin remains hopeful that the House Finance Committee will make necessary changes to the capital budget to generate jobs and promote resource development. The governor, along with House and Senate leadership, agreed to a modest capital budget in order to reduce the draw from budget reserves.

The governor is disappointed, though, that the Senate would not even consider any amendments intended to ensure that general funds that match federal and other sources would be included. She proposed to replace lower priority projects with the state's highest priority projects. The Senate refused. Specifically, the Senate omitted $15 million in match for federal highway and aviation projects. Also cut from the governor's budget are specific priorities for resource development including $8 million for the in-state gas line, $4 million for oil and gas reservoir assessments, $3 million for access to resources in western Alaska, and $26 million for ongoing upgrades to the Dalton Highway which is a vital link to Alaska's North Slope.

The governor has provided amendments to the finance committees to address the matching funds that the Senate omitted and also restore the priority resource development projects. The governor has continued to offer to work with legislators to make adjustments to the budget.

Governor Palin also proposed to replace $250 million in state funding with available federal stimulus money as a way to maximize use of the stimulus funds that the legislature resolved to accept and provide relief to the state budget given the revenue shortfall in FY2009 and FY2010. The governor has explained that a reduction in the amount of state general fund spending will reduce the draw on reserves and extend the life of the state's savings.

"I was asked by lawmakers to provide solutions to the problem Alaska faces with decreased revenue resulting in deficit spending and increased draw on our savings accounts," Governor Palin said. "I have done so by crafting a conservative budget and proposing to use the federal stimulus funds they have resolved to accept to replace some of the state's general funds. My proposal allows us to keep healthy savings so we are prepared for the future. Legislators now claim my proposal is not acceptable. Legislators hold the state's purse strings, and they have made their decision. I respect that decision. It's important and fair for Alaskans to know of my administration's attempts to rein in state government growth and not contribute to the nation's growing debt that we are passing on to our children."


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