Alaska Senate passes compromise state operating budget

JUNEAU (AP) — The Alaska Senate on Tuesday passed a compromise state operating budget that restores funding for public schools, reduces a proposed cut to the university system and aims to prevent layoff warnings being sent to state workers.

The vote came after House and Senate negotiators reached a deal late Monday. The House was expected to take up the measure later Tuesday.

The compromise addresses a number of issues that were important to minority House Democrats. Support from the minority is needed in the House to access a reserve fund to cover costs not covered by revenue.

Rep. Les Gara, D-Anchorage, the lone minority member on the budget conference committee that announced the compromise, said he hoped it could be broadly accepted.

Even with a budget deal, committee members acknowledged there was still work to do during the special session. The state faces a multibillion-dollar budget deficit amid low oil prices, and the pieces of a long-range fiscal plan proposed by Gov. Bill Walker to help dig the state out of the hole were pending.

Legislative leaders have wanted to avoid a repeat of last year, when a budget fight spilled into June and thousands of state workers received notices warning of possible layoffs if a budget wasn't approved by July 1. The deadline for mailing those warnings is Wednesday afternoon.

Asked if the governor would accept a budget funded with money from the constitutional budget reserve, Walker spokeswoman Grace Jang said he typically doesn't comment on pending legislation until it reaches his desk.

Senate Finance Committee co-chair Anna MacKinnon, a Republican from Eagle River, said the budget represents a bipartisan effort and addresses "the need to cut, the need to invest and the need to compromise."

Senate Finance Committee co-chair Pete Kelly, R-Fairbanks, said the cutting will continue next year, given the state's fiscal situation.

The budget deal eases the level of a proposed cut to the University of Alaska system, provides funding for prekindergarten and early childhood education programs, reduces a cut to the state ferry system and allows for collected cruise ship passenger taxes to flow to certain communities where the ships stop. The committee previously recommended not distributing the taxes during the coming fiscal year.

The deal also restores K-12 funding to previously anticipated levels and adds a bit extra to that, according to Legislative Finance Division Director David Teal. It also addresses funding for public broadcasting.

The package includes some money from the current year.

During the regular and extended session, disagreement over how much to change Alaska's oil and gas tax credit structure proved to be a stumbling block, and legislators said they saw resolution on that issue as key to making further progress on the budget and on revenue bills.

That issue still wasn't resolved, but Gara said the expectation is that work on it will continue.

05/31/2016 - 3:36pm