The governor’s office released a proposal Friday for using the more than $1.5 billion in federal aid coming to the state from the American Rescue Plan Act. The package includes just over $1 billion in discretionary funds, the governor’s office said in a news release, and $518 million in nondiscretionary funds.
“This proposed allocation of federal ARP funds is intended to assist and mitigate economic fallout from COVID,” Gov. Mike Dunleavy said in the release. “My administration will work with the Legislature to refine these appropriations as additional guidance is provided by the federal government. I look forward to implementing a robust plan for these federal funds for the benefit of all Alaskans.”
The plan allocates $325 million for infrastructure projects such as safe water, sewer, and broadband infrastructure. The state will be able to leverage local and other funding using matching grant programs, according to the governor’s office.
Dunleavy proposed roughly $350 million in general obligation bonds for infrastructure projects in December as part of his proposed budget for the 2022 fiscal year. But even with the additional money from the federal government Dunleavy spokesperson Jeff Turner said the governor still supports the bonds. The state is still waiting on additional guidance from the U.S. Treasury Department on how the federal funds can be used, Turner said.
But with lawmakers anticipating federal funds, Rep. Sara Hannan, D-Juneau, said those bond proposals hadn’t found much support in the Legislature. Hannan said Friday afternoon she had not yet been able to review the proposed use of the funds, but that she and other lawmakers were looking at all available vehicles for funding.
[Dunleavy proposes budget for ‘unprecedented’ times]
In addition to funding for infrastructure, the federal relief provides $325 million for economic recovery and innovation, $150 million for tourism revitalization and $139 million to offset general fund expenditures. The proposal will be submitted to the Alaska State Legislature on Monday as legislation for consideration and collaboration on a final program in the form of an appropriation bill, the release said.
The administration is working with national organizations and federal agencies to clarify amounts, coordinate questions and understand the requirements tied to the funds, according to the governor’s office. The administration is anticipating an iterative process with numerous additional items forthcoming as funding opportunities arise and final federal allocations and guidance are released.
Two of the largest allocations under the proposal are $112 million for capital projects and $185 million in funding for local governments. Allocations for the local funding are determined by U.S. Treasury Department methodology, according to the governor’s office, but the state will need to apply to the Treasury for specific capital projects. Further details on the requirements and application process for capital project funding should be available on or before May 10, according to the governor’s office.
• Contact reporter Peter Segall at psegall@juneauempire.com. Follow him on Twitter at @SegallJnuEmpire.
