HOMER — Gov. Bill Walker on Friday encouraged two diverse Homer audiences not to overreact or panic as the state makes some changes and figures its
way out of a budget deficit of more than $3 billion. Contrary to Alaska being on the rocks, as one BBC reporter said during a recent interview, Walker said, “We don’t have a wealth problem. We have a cash-flow problem. We have one hundred billion dollars in wealth. That’s phenomenal.”
Alaska’s savings breaks down to $55,000 per person in the state. But the state still faces some challenges.
“We have to be responsible when we deal with our cash-flow problem, so we don’t impact Alaska and Alaskans,” Walker told an audience of mostly senior
citizens and senior services providers gathered for the second Southern Peninsula Senior Summit Friday afternoon.
As his administration proposes changes to close the budget gap it will be sensitive to the needs of seniors and will not stop providing services to seniors, Walker said. He provided few specifics except to say Powerball, which would bring in only about $8 million annually, probably was not on the roster of proposed revenue options.
In an interview with the Homer News following the summit, he said his administration is still putting the final touches on a three-year financial plan designed to erase the budget gap. An administration meeting is planned for Sunday, followed by a five-hour Cabinet meeting Monday to work on the proposal. Plan specifics are expected to follow soon.
At the Friday night awards banquet for the Alaska Park and Recreation Association, which was wrapping up its 40th annual conference in Homer, Walker reminded the crowd that Alaska has seen tough times before.
“You’ve got to remember, you’ve got a governor and a lieutenant governor who, when we were born, the price of oil in Alaska was zero. So we’ve come up 47 dollars,” he said.
Before the seniors, Walker mentioned one of the challenges faced is explaining to Alaskans how it’s possible to have the largest permanent fund
dividend at the same time the state has its biggest deficit. “We still have some work to do to help people understand the difference between the dividend and the general fund and how our revenues come in,” he told the seniors.
In both of his Homer appearances, made with First Lady Donna Walker, and in an interview with the Homer News, the governor emphasized the way out of the deficit is for Alaskans to pull together. At the Senior Summit, he described a photo that Lt. Gov. Byron Mallot gave him following a trip to Metlakatla, in Southeast Alaska. The photo, taken in 1915, shows a lot of people standing around in raincoats, in a lot of mud.
Walker didn’t quite understand it a first, he said. The story behind the photo: In those days, if anyone needed to pull tree stumps out from anywhere, the whole town would show up to help. The title of the photograph is “Pulling Together.”
“That’s what we need to do. And that’s what we’re going to do. And that’s what we are doing. We are pulling together. My message on the financial side is: ‘Yes, we’re going to make some adjustments. Yes, there’s going to be a lot of concern about that, but we’re not going to stop being who we are,’ Walker told the seniors.
While in Homer, the governor covered a range of issues, including:
“I want to make sure that the jobs that are available in resource development are also tied to Alaskans. We provide hundreds of millions of dollars of credits as far as investment credits or credits for their exploration and I want to make sure that’s tied to local hire, our young people. It’s really a matter of Alaskans receiving training for that,” Walker said. He also said that he’d like to see money currently spent on consultants with Wall Street firms be spent in Alaska and with young people working with investment firms that have offices in Alaska.
“I remember giving a talk (soon after the first barrel of oil flowed into Valdez after completion of the oil pipeline) and saying if we invest our money right over the life of this pipeline we will celebrate the last barrel of oil with the same enthusiasm as the first barrel of oil,” Walker said. “We have not diversified our economy like we should have, so we’re sort of paying the price for it. We’ve tied our economy to one commodity price. I want to make sure when we develop our resources, we’re not just shipping off the raw material.”
“The cost of energy in Alaska is so high that sometimes young and old alike must leave the state in order to survive financially, the governor said. He mentioned opportunities that Norway has created because of its lower energy costs. People ship their raw material to Norway to be processed and then it leaves as a finished product, so they do the opposite of what we do. We have the resources. They have the low-cost energy, so we need to get the cost of energy down,” Walker said. Developing renewable energy will be critical to Alaska’s future, he said.
“We have to balance different developments and I’ve said this consistently if one development is going to eliminate the other, one resource going to eliminate the other, I’m going to go with the renewable resource, which certainly is with fish,” he said.
“We sometimes don’t think big enough. We wrap ourselves around the issue of the day and that’s important but we’ve lost our vision of what we want to be in 50 years. What kind of Alaska do we want to have in 50 years? That’s what we wrestle with. We have to deal with the here and now, while not taking our eye off the long term.”
Reach Lori Evans at lori.evans@homernews.com Homer News reporter Annie Rosenthal also contributed to this story.
