Kelly: Taxes not on the table this year

One of the leaders of the powerful Senate Finance Committee has said taxes are not on the table this year as the Legislature considers how to balance a $3.7 billion deficit.

Speaking at a press conference Tuesday morning, Sen. Pete Kelly, R-Fairbanks, said he isn’t interested in taxes as a solution.

“I’m one vote, but I’m not getting into the tax business while I know government is too big,” he said.

The Senate on Monday passed an $8.73 billion operations budget that cuts $571 million from the current fiscal year. The Senate’s budget is effectively a draft, however, as the House is not expected to concur with the Senate’s changes. The House’s disapproval would mean the Senate and House versions of the budget will go to a conference committee for a discussion on a compromise proposal that combines both drafts.

“It needs to be smaller before we can ever get into a conversation with Alaskans (about taxes),” Kelly said.

Gov. Bill Walker has proposed a wide-ranging plan that includes taxes, spending some of the earnings of the Alaska Permanent Fund, and budget cuts to erase the deficit by 2018. None of Walker’s tax proposals have yet reached the Senate Finance Committee, and none of the three proposals for spending Permanent Fund earnings have reached the committee yet, either. Wednesday was the 58th of 90 days in the legislative session.

Last year, he said, the Legislature cut hundreds of millions of dollars from the budget.

“They said the sky was going to fall, and essentially nothing happened. Government continued to function. That tells me (the budget) was at least that fat,” Kelly said. “We’re going to do it again.”

While Kelly spoke only for himself, his fellow Finance Committee members seemed to indicate a willingness to use the state’s $8.2 billion Constitutional Budget Reserve, instead of new revenue, to balance the budget.

“You don’t have to fill the entire gap,” said Sen. Peter Micciche, R-Soldotna. “I think that’s where the governor and us are in some disagreement.”

He said it make sense to spend from savings because Alaska is in a position akin to that of parents who have saved for their child’s college education. “Our child just graduated from high school, and it’s time to start thinking about how we’re going to pay for college,” he said.

Sen. Lyman Hoffman, D-Bethel and a member of the Senate Majority on the finance committee, said he expects the Legislature to use savings, but that’s not necessarily a permanent thing.

“We are going to be using savings accounts, but as was with the budget when people said everything was on the table, I believe that everything on the revenue side has to be on the table too,” he said.

In regard to permanently filling the deficit, he said: “It’s not going to happen in one year, but I’m hopeful that we will make some strides. The focus of the next 30 days is to look at all options.”

• Contact reporter James Brooks at

More in News

Jasmine Chavez, a crew member aboard the Quantum of the Seas cruise ship, waves to her family during a cell phone conversation after disembarking from the ship at Marine Park on May 10. (Mark Sabbatini / Juneau Empire file photo)
Ships in port for the week of June 22

Here’s what to expect this week.

Eddie Petrie shovels gravel into a mine cart as fast as possible during the men’s hand mucking competition as part of Juneau Gold Rush Days on Saturday at Savikko Park. (Mark Sabbatini / Juneau Empire)
Mucking, trucking, chucking and yukking it up at Juneau Gold Rush Days

Logging competitions, live music, other events continue Sunday at Savikko Park.

(Michael Penn / Juneau Empire file photo)
Police calls for Thursday, June 20, 2024

This report contains public information from law enforcement and public safety agencies.

Pins supporting the repeal of ranked choice voting are seen on April 20 at the Republican state convention in Anchorage. (James Brooks/Alaska Beacon)
State judge upholds most fines against group seeking repeal of Alaska ranked choice voting

An Anchorage Superior Court judge has ruled that opponents of Alaska’s ranked… Continue reading

Joshua Midgett and Kelsey Bryce Riker appear on stage as the emcees for MixCast 2023 at the Crystal Saloon. (Photo courtesy Juneau Ghost Light Theatre)
And now for someone completely different: Familiar faces show new personas at annual MixCast cabaret

Fundraiser for Juneau Ghost Light Theatre on Saturday taking place amidst week of local Pride events

Jasz Garrett / Juneau Empire
A section of Angoon along the coast is seen on June 14. Angoon was destroyed by the U.S. Navy in 1882; here is where they first pulled up to shore.
Long-awaited U.S. Navy apology for 1882 bombardment will bring healing to Angoon

“How many times has our government apologized to any American Native group?”

Juneau Mayor Beth Weldon announced this week she plans to seek a third three-year term. (Juneau Empire file photo)
Mayor Beth Weldon seeking third term amidst personal and political challenges

Low mill rate, more housing cited by lifelong Juneau resident as achievements during past term.

(Michael Penn / Juneau Empire file photo)
Police calls for Wednesday, June 19, 2024

This report contains public information from law enforcement and public safety agencies.

A king salmon is laid out for inspection by the Alaska Department of Fish and Game at the Mike Pusich Douglas Harbor during the Golden North Salmon Derby on Aug. 25, 2019. (Peter Segall / Juneau Empire file photo)
Emergency order bans king salmon fishing in many Juneau waters between June 24 and Aug. 31

Alaska Department of Fish and Game says low projected spawning population necessitates restrictions

Most Read