While the bulk of state expenditures occur via the operating budget, the capital budget is a separate lever policymakers often use to cut or increase the state’s overall spending. This year, due in part to high oil revenue, they wedged many pet projects into the capital budget. This is unfortunate, unsurprising and irresponsible.
The state capital budget is meant to fund exactly what it sounds like: capital projects, mainly infrastructure and assets, such as public buildings, bridges and roads. It is assumed that the capital budget pays for necessary projects that will benefit the entire state, not community projects that are more appropriately funded through local government or private support.
Yet this year, Alaska policymakers appropriated at least $16 million to pay for projects outside the scope of state government. While many of them are admirable programs, they are not state priorities, and the appropriated money would be better used elsewhere, including savings.
Distribution of capital project funds by House district — which legislators slid in pet projects for their districts — is available through Alaska’s Legislative Finance Division. The list includes handouts such as $2.5 million for facilities at the private Alaska SeaLife Center; $7.3 million for the private Alutiiq Museum & Archaeological Repository; $6.3 million for creation of a new private Chugach Region Archaeological Museum; $87,000 to replace a scoreboard for the private Seawolf Hockey Alliance; and $588,775 to the private Dimond Alumni Foundation to replace diving boards.
Many Alaskans — and visitors to the state — benefit from sports teams and museums. However, these should be financially supported by beneficiaries, not by the state’s pocketbook, which is not bottomless.
For contrast, two appropriations that will benefit the vast majority of Alaskans were $175 million for the Port of Nome and $200 million for the Port of Alaska. While the Port of Alaska is owned by the municipality of Anchorage, it handles goods bought by 90% of Alaskans. Projects enabling the Port of Nome to expand its capacity, meanwhile, are broadly beneficial because Alaskans are currently so reliant on the Port of Alaska. Creating capacity through multiple ports not only increases the available flow of goods, but also protects against unexpected problems at one or the other.
The governor vetoed some capital projects that clearly did not belong in the state’s budget, such as $300,000 for the construction of a private “Equity Center.” The requestor was a community-based advocacy group, meaning it should be financially supported by its community, not the government. The state government should not be paying for non-state-owned buildings regardless of the cause for which they are used. It is unfortunate that more pet projects were not eliminated on similar grounds.
Overall, state funds appropriated for the capital budget add up to more than $935 million. This is the largest share of state funds in the capital budget Alaska policymakers have enacted since 2014, and the federal government added another $2 billion. While many projects required state matches to claim the federal funds, the vast wave of cash allowed policymakers to sneak in their favored projects and increase the capital budget total.
Millions of dollars are being spent to fund localized community projects that should instead be funded by local support and private sources. Alaskans deserve responsibility and transparency, not waste and opacity.
Bethany Marcum is CEO of Alaska Policy Forum and recently served as one of Gov. Mike Dunleavy’s appointees to the Alaska Redistricting Board.
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