A subcommittee of the Alaska House is recommending big cuts to the budgets of the Alaska Seafood Marketing Institute and state-funded tourism marketing efforts.
The Alaska House Finance subcommittee for the Department of Commerce and Economic Development unanimously recommended a $137.8 million budget for the department in the next fiscal year, which starts July 1. That’s a drop of $27.3 million and 18 employees from the previous fiscal year.
“This is unpleasant, but unpleasant is sort of necessary these days,” said Rep. Jonathan Kreiss-Tomkins, D-Sitka and a member of the subcommittee, on Wednesday night.
Subcommittee chairman Rep. Lance Pruitt, R-Anchorage, seemed to agree. “This is tough. These are tough times,” he said after the subcommittee approved the budget.
With the state facing an annual deficit of between $3.5 billion and $4 billion, legislators are heeding the call of Alaskans to make cuts before they seek new taxes and spend Permanent Fund earnings to fill the rest of the gap.
The subcommittee budget “closeouts” this week are recommendations for each department. Next week, the full House Finance Committee will begin considering the budget, and the entire House is expected to vote on the budget in the second week of March.
If approved, the budget will head to the Senate, where the process of subcommittee, committee and floor vote will repeat while the House digs in earnest into tax and revenue proposals.
For the Department of Commerce, Pruitt said by phone on Thursday that he faced a range of suggestions when it came to tourism and seafood marketing.
“I had everything from start at a 10 percent cut to both, to completely get rid of the general fund for both, and in the end I tried to come up with a compromise — that’s the 30 percent for both,” he said.
Pruitt said his goal and the committee’s goal is to make the state’s tourism marketing and seafood marketing programs self-sustaining, funded through fees paid by the respective industries, not money contributed by the state.
“My goal with these two programs ─ because I find value in both these programs ─ is manage our way away from general fund money and toward self-sustainability,” he said.
The Commerce budget also includes significant cuts to the Alaska Energy Authority’s alternative energy programs, which have funded wind and hydroelectric projects from Southeast to Kodiak and the North Slope. Gov. Bill Walker suggested removing all funding for alternative energy — a cut exceeding $7 million — and the commerce subcommittee went one step farther, encouraging the AEA and the Alaska Industrial Development and Export Authority to explore the possibility of a partial or complete merger.
Commerce subcommittee members turned down a request for more staff at the new Alcohol and Marijuana Control office but did grant permission for that office to spend fees it collects in the current fiscal year, which ends June 30. The state began collecting marijuana license fees on Wednesday.
Rep. Sam Kito III, D-Juneau and one of the subcommittee members, voted in favor of the recommendations but said Wednesday night that he has some concerns with the reductions but hopes they will get the state on a path “to have a stable ability to market with the rest of the world. I am hopeful that what we have done here gets us in that direction.”
In other business, the subcommittee for the Alaska Department of Labor and Workforce is recommending a $164.3 million budget for Fiscal Year 2017, down $20.8 million since Fiscal Year 2015 and $12.6 million from the current fiscal year.
Walker had suggested $11.3 million in cuts, and the committee cut another $1.3 million, largely from workforce development programs and the commissioner’s office.
The subcommittee also said the state’s construction academy program, which teaches high school students and adults, should wean itself off state funding over the next four years.
In the subcommittee for the Department of Revenue, members are suggesting a budget of $400.1 million, a figure up $900,000 from last year. Walker had suggested an increase of about $2.5 million, but the subcommittee trimmed that.
Late Thursday, the budgets of the departments of Transportation, Natural Resources, Fish and Game, Military and Veterans Affairs, the governor and the Legislature were scheduled to pass out of subcommittee.
On Thursday morning, the budget for the Department of Environmental Conservation was formally approved after being vetted Tuesday. For coverage of that department’s budget, see the Wednesday edition of the Juneau Empire.