JUNEAU — Gov. Mike Dunleavy’s cost-cutting budget proposal may make it more difficult for Alaska’s congressional delegation to deliver federal money to Alaska, U.S. Sen. Lisa Murkowski said Tuesday during her annual visit to the state Capitol.
Alaska’s two U.S. senators normally stay away from legislative issues when they deliver their annual addresses to the Alaska Legislature, but Murkowski obliquely and directly addressed aspects of the governor’s planned $1.8 billion budget cut.
In a news conference following her address to the Legislature, Murkowski said it “absolutely” is more difficult for her and the other members of Alaska’s congressional delegation to obtain federal funding if the state doesn’t pitch in.
“If we’re not willing to invest in ourselves, why would we expect anyone else to invest?” she said.
According to figures from the Office of Management and Budget, Dunleavy’s budget reduces spending by $1.8 billion. With less state funding, many programs become eligible for less federal funding.
Without that state cash — and particularly at a time when the governor is considering a boost to the Permanent Fund dividend — Murkowski said it becomes more difficult to unlock federal coffers for Alaska.
“When I try to make the case for additional money for very basic things — water and sewer — what I’ll hear is, ‘Well, wait a minute, how much is that free money that you give away to Alaskans every year?’" she said. “What I say is, we were actually smart and responsible in saving and investing the revenues that we received from our finite resources, so good on us.”
Murkowski did not say whether she supports or opposes the governor’s budget but said it’s now time for the Legislature to play its role in the process.
“Here in Alaska, we’ve got a Legislature that is going to be dealing with some very difficult and very challenging issues, but I think the Legislature needs to recognize its role and stand up to its role as the appropriators,” she said after her address.
Sen. Donny Olson, D-Golovin, asked Murkowski her opinion on Dunleavy’s proposal to divert petroleum property taxes from local governments to the state.
“At first blush, the proposal is concerning to me,” Murkowski said of the idea.
She said encouraging North Slope development is difficult enough without adding additional obstacles.
“I would discourage anything that creates division among Alaskans over the value of our natural resources,” she said. “The state’s going to have to decide this, but we’ve got enough opposition coming at us from outside the state to develop our own resources.”
Murkowski said she supports the proposal to build a trans-Alaska natural gas pipeline and hopes the Dunleavy administration will continue to seek a federal permit for it. The pipeline project’s permit application is being considered by the Federal Energy Regulatory Commission.
“Going through the FERC application process is not a cheap undertaking,” she said. “It will be very difficult to come back to it later.”
Murkowski said she is concerned about budgetary changes that could reduce Medicare and Medicaid payments to doctors who serve patients under those state-federal programs. The governor has proposed cutting Medicaid services by more than $700 million, according to figures from the Office of Management and Budget.
If doctors are paid less, they might be unwilling to take Medicare or Medicaid patients.
“It would be a pretty tough scenario around this state if providers were to say, I can’t do Medicare and I can’t do Medicaid,” Murkowski said.