Voices of Alaska: Alaska budget myth vs. fact

  • By Diane Kaplan
  • Saturday, March 26, 2016 6:12pm
  • Opinion

By now, nearly everyone is concerned about the state’s budget deficit. Research by Rasmuson Foundation shows that most Alaskans support some level of budget cuts to make state government more sustainable, but where?

When asked, 41 percent of Alaskans say they don’t know where to cut. Six percent say cut across the board; another 6 percent say just cut somewhere. Six percent of Alaskans say cut education, while two percent say no education cuts. Yet education makes up nearly 27 percent of the state’s budget.

While some point to a ballooning state budget, in reality per capita expenditures for many state agency operations have remained stable during the past decade. Huge annual fluctuations are present in capital spending, debt and paying oil tax credits to companies that have earned them.

ADVERTISEMENT
0 seconds of 0 secondsVolume 0%
Press shift question mark to access a list of keyboard shortcuts
00:00
00:00
00:00
 

It’s understandable that legislators are struggling to make decisions on cuts. Looking more closely at the unrestricted general fund, which contains the day-to-day operations of state government and its programs, we can see that two-thirds of our state expenditures are for education and health. Alaska cannot make meaningful reductions in its spending if these two departments are off the table. Making cuts here is unpopular with some, and there’s no denying that some Alaskans will be negatively affected as a result.

While the survey answers didn’t unveil many specific suggestions, it did point to frustration about perceived waste and unnecessary spending. And as the various budget proposals in Juneau begin to take shape, Alaskans should know what we’ve already cut in order to make good decisions about where we can absorb more cuts in the future. Despite perceptions, real cuts with real impacts were made last year.

Below are some common myths about last year’s cuts:

Myth: The cuts made so far are superficial.

Reality: Lawmakers approved more than $350 million in cuts to the operating budget last year, which amounts to an almost 10 percent decrease.

Myth: The number of state employees has been cut only by leaving vacant positions unfilled.

Reality: According to the Office of Management and Budget, as of last October, state agencies employed 587 fewer employees than a year earlier. Those are real pink slips, not just empty chairs left vacant. Add in temporary workers, Alaska Railroad employees, and the university — the number more than doubles.

Myth: The University of Alaska budget has been shielded from budget scrutiny.

Reality: The university budget has been cut for each of the past three years and by $26.4 million last year alone. Student tuition continues to rise. Educational offerings continue to be condensed.

Myth: Alaska heavily subsidizes a ferry system that benefits few Alaskans.

Reality: A recent study by the McDowell Group found that every dollar the state invests into the Alaska Marine Highway System generates two dollars in economic benefit across the state. Last year’s $9.8 million cut has reduced service, including mothballing the two newest ferries and leaving Prince William Sound ports without service for six weeks.

Myth: Roads aren’t being plowed just to make it appear there have been big budget cuts.

Reality: Last year the Highways, Aviation and Facilities department was cut by $15.3 million, which eliminated 34 jobs and reduced allowable costs for overtime and supplies. This means roads receive less maintenance, and in severe weather, response times are longer.

Myth: Public safety is immune from cuts.

Reality: As a result of a $14 million cut, Alaska lost all but two highway patrol positions, eliminated cold case investigations and announced the closure of stations in Girdwood, Talkeetna and Yakutat. A dozen communities will lose trooper positions — cutting six troopers in Fairbanks, five in Soldotna, and nine in Wasilla. Rural communities saw a 64 percent reduction in the number of village public safety officer positions — leaving only 78 in the entire state.

Myth: The Department of Administration doesn’t provide essential services, cut there.

Reality: The department, which was cut by $11 million last year, houses agencies and services important to safety and Alaska’s economy. Alaska’s 30 public radio and four public television stations, which were cut by 16 percent or $800,000 last year, are the only source of information in many rural areas and are the providers of the Emergency Alert System.

Myth: Cuts to the state budget don’t harm small businesses.

Reality: One example of how small business and state spending are linked is support for tourism marketing. Alaska will spend $7.8 million less on tourism marketing this year than the year before. Because tourism is a major economic driver in communities throughout the state, actions that reduce the number of visitors will have a negative effect on the small businesses that rely on the visitor industry.

Myth: Education spending just keeps growing.

Reality: The Legislature cut education spending by $100 million last year, mainly in non-classroom programs aimed at enhancing student success like teacher mentoring, early literacy programs, STEM demonstration projects, online distance courses and subsidies for broadband to schools.

Myth: We cut a lot last year and no one noticed. It must have been fat!

Reality: The reduction in capital spending for roads and public facilities last year has resulted in layoffs and wage reductions for many in the construction industry. Some local businesses are projecting a 50 percent drop in work activity by 2018 if capital spending continues at the current level.

To get to a long-term, sustainable budget, we need to find more cuts and efficiencies, but cuts alone will not work. We must have a comprehensive solution that includes taxes, reduced oil tax credits, use of the Permanent Fund earnings and all of the other tools available to us. I encourage Alaskans to try to balance the budget themselves using the Plan4Alaska Budget Challenge, online at challenge.Plan4Alaska.com. While our situation is urgent, Alaska is in a great position to adjust the state budget to protect our economy and preserve our unique way of life.

Diane Kaplan is president and CEO of Rasmuson Foundation, which launched Plan4Alaska.

More in Opinion

(Juneau Empire file photo)
Opinion: Life is harder when you outlive your support group

Long-time friends are more important than ever to help us cope, to remind us we are not alone and that others feel the same way.

A silver salmon is weighed at Three Bears in Kenai, Alaska. Evelyn McCoy, customer service PIC at Three Bears, looks on. (Photo by Jeff Helminiak/Peninsula Clarion)
Opinion: Will coho salmon be the next to disappear in the Kenai River?

Did we not learn anything from the disappearance of the kings from the Kenai River?

Jonathan Flora is a lifelong commercial fisherman and dockworker from Homer, Alaska.
Point of View: Not fishing for favors — Alaskans need basic health care access

We ask our elected officials to oppose this bill that puts our health and livelihoods in danger.

Alex Koplin. (courtesy photo)
Opinion: Public schools do much more than just teach the three Rs

Isn’t it worth spending the money to provide a quality education for each student that enters our schools?

Gov. Mike Dunleavy speaks to reporters at the Alaska State Capitol on Thursday, April 17, 2025. (Jasz Garrett / Juneau Empire file photo)
Letter to the Editor: Law enforcement officers helped ensure smooth, secure energy conference

Their visible commitment to public safety allowed attendees to focus fully on collaboration, learning, and the important conversations shaping our path forward.

Laurie Craig / Juneau Empire file photo
The present-day KTOO public broadcasting building, built in 1959 for the U.S. Army’s Alaska Communications System Signal Corps, is located on filled tidelands near Juneau’s subport. Today vehicles on Egan Drive pass by the concrete structure with satellite dishes on the roof that receive signals from NPR, PBS and other sources.
My Turn: Stand for the community radio, not culture war optics

Alaskans are different and we pride ourselves on that. If my vehicle… Continue reading

U.S. Sen. Dan Sullivan (R-Alaska) delivers his annual speech to the Alaska Legislature on Thursday, March 20, 2025. (Jasz Garrett / Juneau Empire file photo)
Opinion: Sullivan, Trump and the rule of lawlessness

In September 2023, U.S. Sen. Dan Sullivan established his own Alaska Federal… Continue reading

UAA Provost Denise Runge photographed outside the Administration and Humanities Building at the University of Alaskas Anchorage. (courtesy photo)
Opinion: UAA’s College of Health — Empowering Alaska’s future, one nurse at a time

At the University of Alaska Anchorage, we understand the health of our… Continue reading

U.S. Rep. Nick Begich III, R-Alaska, address a joint session of the Alaska Legislature on Thursday, Feb. 20, 2025. (Mark Sabbatini / Juneau Empire file photo)
Opinion: A noncongressman for Alaska?

It’s right to ask whether Nick Begich is a noncongressman for Alaska.… Continue reading

Boats return to the Homer Harbor at the end of the fishing period for the 30th annual Winter King Salmon Tournament on Saturday, March 23, 2024 in Homer, Alaska. (Delcenia Cosman/Homer News)
Opinion: Funding sustainable fisheries

Spring is always a busy season for Alaska’s fishermen and fishing communities.… Continue reading

Gov. Mike Dunleavy holds a press conference on Monday, May 19, 2025, to discuss his decision to veto an education bill. (Jasz Garrett / Juneau Empire file photo)
Opinion: On fiscal policy, Dunleavy is a governor in name only

His fiscal credibility is so close to zero that lawmakers have no reason to take him seriously.

You're browsing in private mode.
Please sign in or subscribe to continue reading articles in this mode.

Peninsula Clarion relies on subscription revenue to provide local content for our readers.

Subscribe

Already a subscriber? Please sign in