Governor Sean Parnell today signed Alaska's budget bills into law -- House Bills 266 and 267, and Senate Bill 119. The budget bills reduce state spending and pay down Alaska's debt by addressing the unfunded pension liability. In addition to reducing general fund spending by $1.1 billion, the approved 2015 budget spends 16 percent less in state general funds than the current fiscal year. With all funds, including Permanent Fund dividends and federal dollars, FY 2015 appropriations total $12.8 billion.
"Alaska is on a more secure financial path as a result of our efforts to reduce spending and address Alaska's largest cost driver -- our unfunded pension liability," Governor Parnell said. "Alaska's financial position remains strong and our future is bright. I commend the Legislature for working with me to rein in spending, meet our obligations, and make strategic investments for the future."
Governor Parnell and the Legislature added another $300 million over the next three years for Alaska's K-12 schools. The governor's Alaska's Education Opportunity Act was signed into law this month. As a result, significantly more funding can head to classrooms and Alaska's students now have many more educational opportunities, including opportunities for residential, correspondence, home and charter schools, and vastly expanded vocational education choices.
"Between more educational opportunities and increased funding, we took a significant step toward ensuring our students are well prepared, and Alaska's future remains bright," said Governor Parnell.
The budget includes $81.5 million to advance an Alaska gasline, the Alaska LNG Project. For the first time in history, all the necessary parties for a project are aligned, and the Legislature has authorized the state to proceed into the early engineering and design phase. This provides a clear path toward a gasline that can create thousands of jobs, fuel Alaskan homes and businesses, and grow our economy.
The governor's proposal to pay down Alaska's pension debt, thereby lowering the state's annual debt payments for years to come, won approval from legislators.
Legislators unanimously agreed to transfer $3 billion from the Constitutional Budget Reserve Fund - $2 billion into the Teachers' Retirement System and $1 billion into the Public Employees' Retirement System. Governor Parnell will sign House Bill 385 next month, allowing the state to make lower annual payments to the pension plans and better control spending in the future.
Action taken by the Legislature to promote education reform and funding, further gasline development, address the unfunded pension liability, and reduce the overall level of spending were significant accomplishments of the session.