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Legislative budget tricks and false promises imperil state economy

  • Author: Dermot Cole
    | Opinion
  • Updated: April 8, 2017
  • Published April 8, 2017

House Republicans keep saying they had a great plan to cut $300 million from the state budget and Senate Republicans say they came pretty close this week, with hundreds of millions more to come.

Neither assertion is accurate, as both efforts relied too much on gimmicks and number games.

The reason the big talk about cutting up to three-quarters of a billion dollars from the budget remains vague is that the public is not asking for a cut in state services and most legislators understand that.

But rather than discuss taxes and risk a backlash, Republican legislators serve budget-cut fantasies and risk a backlash.

It's easy to run for office saying "cut government." It's hard to run for office saying, "cut schools, cut road maintenance, cut public safety, etc."

The Senate won't find $750 million in budget cuts over the next three years and House Republicans won't find $600 million in budget cuts without electoral turmoil.

Instead of identifying major programs or services to cut, House Republicans offered hundreds of budget-cut amendments and talked for as long as possible. In many cases the only justification was, "This is a small amount."

North Pole Rep. Tammie Wilson celebrated her 243 amendments and took pride in her decision not to check her numbers with the budget experts at state agencies. The result was a baffling scattershot approach that was noteworthy for its level of misinterpretation and erroneous information.

The plan to cut funding for hundreds of ghost positions for which funding had already been cut remains the prime example. She and others also proposed cuts of more than $40 million based on a misreading of state spending in recent years, falsely assuming that agencies are not allowed to move money within appropriations.

Some amendments were not reductions at all, such as the proposed $24 million Medicaid cut with no change in enrollment, which would have required a supplemental appropriation of $24 million next year. Or the plan to take money for the 2018 elections out of the budget, knowing the bill would come due in a year.

The most significant budget cuts proposed by House Republicans, which have now been endorsed by the full Senate, would reduce funding for education by about $90 million.

The impact of these large and arbitrary reductions on students, families, school districts and the university have not been examined or justified.

Instead of using hundreds of small amendments, the Senate opted to move money out of the general fund and into special funds, an approach that looks familiar to anyone who has tried to follow the pea in a shell game.

"The Alaska Senate Majority passed a sustainable operating budget today, reducing state spending by $276 million," the Senate publicity office said Thursday.

Tens of millions of so-called reductions are expenses that will have to be paid a year from now. Tens of millions more came about by shifting money into special categories or moving money between fiscal years.

Classifying $70 million in fuel tax revenue in a special category does not mean it is a $70 million spending reduction. To complicate matters, the fuel tax increase hasn't been approved, so a big chunk of that remains imaginary.

Exact numbers are hard to come by, given the ways in which tens of millions migrated hither and yon, but the real proposed Senate spending reductions are probably $130 million to $150 million.

School districts, the University of Alaska and the Pioneers Homes would be hit hard if the Senate numbers stand. The House will push for lesser cuts, but a budget conference committee is likely to be divided 3-3, which may lead to a stalemate.

For Sen. Mike Dunleavy, R-Wasilla, who says he wants $1.1 billion in cuts over the next four years, the Senate budget reductions did not go far enough.

Dunleavy proposed cutting a few million for public broadcasting and made several other small cuts, but he did not identify big-ticket items. He proposed a $100 million unidentified cut and said the governor could figure it all out.

That would have had the advantage of allowing Dunleavy to avoid the blame for whatever might get cut.

As to the rest of the $1.1 billion in unidentified cuts, he has not offered a list. He has provided no clue on why getting rid of 15,000 jobs, both public and private, makes the slightest bit of sense.

It will take more than budget tricks and false promises to solve this fiscal crisis.

Columnist Dermot Cole can be reached at 

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