House sends bigger state budget to Senate

The music on the TV broadcast was Wu-Tang’s C.R.E.A.M. (Cash Rules Everything Around Me), but Pink Floyd might have been just as appropriate.

In a 22-17 vote Monday, the Alaska House of Representatives put another brick in the wall of the Alaska state budget, approving a $9.7 billion spending plan that will go to the Alaska Senate for consideration following a procedural vote Wednesday.

The state operating budget is up about $75 million from Gov. Bill Walker’s original proposal and the $9.63 billion budget approved by lawmakers last year, but that’s likely by design. With the Senate proposing hundreds of millions of dollars in budget cuts and both sides needing to compromise, the House plan puts an upper bumper on any budget compromise.

“Clearly there was no interest in reducing the budget,” said Rep. Tammie Wilson, R-North Pole.

Wilson was the author of hundreds of amendments that would have cut significantly from the proposal crafted by the majority. Almost all of those amendments were rejected, either in committee or in an extraordinary five days of floor amendments that set the record for the most ever considered by the full House.

The ultimate figure, expected in late April or early May, will be somewhere between the House and Senate figures.

“The disagreement we’re having is how much those cuts should be,” said Rep. Neal Foster, D-Nome and co-chairman of the House Finance Committee.

Rep. Chuck Kopp, R-Anchorage, said lawmakers all realize they need to make tough choices to balance a $2.7 billion annual deficit.

“We are now merely debating what those tough choices look like,” he said.

The 18-member Republican House Minority favors more tough choices on the spending side. The minority wants more cuts and a spending plan closer to the Senate’s ideal.

“We’re at a turning point right now in Alaska’s history,” said Rep. Lora Reinbold, R-Eagle River, who added that the proposal put forward by the coalition House majority is a “Denali-sized budget.”

In contrast to the minority, the House majority is favoring tough choices on taxes and revenue. Members of the majority, which includes independents, Republicans and Democrats, say further deep cuts will drive catastrophic job losses akin to the Great Alaska Recession of the 1980s.

“I don’t know who’s going to win the soundbite war on this, but I want to win the war on the recession,” said Rep. Les Gara, R-Anchorage.

Gara argued that the state’s ongoing recession, the worst since that 1980s dip, will cause people to leave the state. Deep budget cuts will encourage more people to leave.

“That’s not how you build an economy. That’s how you destroy an economy,” he said.

Rep. Justin Parish, D-Juneau, said after the vote that it was “a step in the right direction.”

Rep. Sam Kito III, D-Juneau, added that it’s just a first step, and there’s plenty more to come.

As the Senate prepares to take up the House’s version of the budget, the House itself is switching gears to the second half of the budget discussion: How to pay for it.

House Bill 111, which proposes increasing taxes on oil production, and House Bill 115, which proposes an income tax and a draw from the earnings of the Permanent Fund, are being heard in the House Finance Committee this week.

 


 

Contact reporter James Brooks at james.k.brooks@juneauempire.com or call 419-7732.

 


 

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