What others say: Legislature should prepare for work on state revenues

  • Sunday, November 27, 2016 8:16pm
  • Opinion

Don’t start spending the “other half” of your 2016 Alaska Permanent Fund dividend check yet. A judge last week ruled in favor of the state, finding that Gov. Bill Walker was acting within his authority when he vetoed part of the allocation for the annual disbursement to qualifying state residents. Undeterred, Alaska Sen. Bill Wielechowski, D-Anchorage, says he will pursue an appeal. But regardless of how the case is ultimately resolved, the state’s budget situation is untenable, and the new Legislature should waste no time in rectifying it.

The question of whether Gov. Walker has the legal authority to partially veto the dividend allocation is a good one, and resolving it is in the state’s best interest. While it’s hard to imagine the governor taking the step except in extreme circumstances, as happened this year, the dividend constitutes a massive outflow from state coffers. Knowing whether that sum is subject to the governor’s approval will affect future budget negotiations and could prompt an attempt by legislators to restrict or remove the governor’s ability to veto it.

If the state is ultimately forced to pay out the roughly $667 million the governor vetoed from this year’s dividend distribution, it would make quite a few Alaskans happy while at the same time worsening the state’s fiscal crisis by further depleting shrinking savings accounts. That’s why it’s imperative that the new Legislature end the failure of the prior Legislature during the past two years to make great progress toward a balanced budget. The obfuscation, foot-dragging and delay have already cost the state in jobs and in its credit rating. And while revenue measures such as restructuring the permanent fund’s earnings may not be especially popular, their necessity is obvious to anyone who takes a serious look at the state budget situation.

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

Gov. Walker and the Legislature have done what they can with cuts during the past two years, in keeping with the widely held notion that government is too big and needs to trim the fat. But after two years of cuts alone, there’s precious little fat to be cut that won’t affect essential state services such as education, transportation and public safety — and the budget gap is still gaping wide, with a deficit of more than $3 billion per year. Closing the gap through cuts alone is impossible. Closing it through revenue measures will be difficult but possible, and that’s why the new Legislature should act quickly. The first item on its list should be restructuring of permanent fund earnings to provide a steady stream of income to pay for services in the wake of declining oil revenues. This won’t solve the deficit on its own, but it will do more than any other single measure and will go far to preserve a dividend for residents. Absent such a change, the dividend will be mathematically eliminated in about two years.

The path to a balanced budget won’t be easy. One way or another it will involve Alaska residents paying our way as we haven’t had to before. But running a $3 billion deficit while residents receive $2,000 apiece per year and pay no personal state taxes would be considered lunacy by any government in the world. Our free ride has been over for two years, though the last Legislature didn’t acknowledge it through meaningful revenue action. The new Legislature, when it gavels in for session in January, should acquiesce to that reality.

— Fairbanks Daily News-Miner,

Nov. 20

More in Opinion

President Donald Trump and President Vladimir Putin of Russia at a joint news conference in Helsinki, Finland, July 16, 2018. (Doug Mills/The New York Times file photo)
Opinion: Mistaking flattery for respect

Flattery played a role in Trump’s One Big Beautiful Bill.

(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.

Deven Mitchell is the executive director and chief executive officer of the Alaska Permanent Fund Corp. (Photo courtesy of the Alaska Permanent Fund Corp.)
Opinion: The key to a stronger fund: Diversification

Diversification is a means of stabilizing returns and mitigating risk.

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

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