Budget subcommittees make recommendations

Budget subcommittees in the state House finished up their recommendations on the Fiscal Year 2020 state budget last week and public hearings were underway Monday and Tuesday. For the most part legislators rejected sharp budget reductions proposed by Gov. Mike Dunleavy.

The House Finance Committee debated the subcommittee recommendations earlier this week before advancing the budget to the floor of the House and then to the Senate.

Meanwhile the Senate has budget subcommittees at work on its version of the budget. By tradition the Senate waits for the House to finish its work before voting its spending plan.

A House-Senate conference committee will reconcile differences between the two versions.

Monday was the 70th day of the 2019 legislative session. Under a state law the Legislature must adjourn by the 90th day, or April 15, but lawmakers will push past that this year. The state constitution requires legislative work to be finished by the 120th day, however, which is May 15.

The Senate is also unlikely to adopt the governor’s draconian budget cuts but will probably approve a spending figure that is less than that okayed in the House. In a briefing to reporters last Friday Senate President Cathy Giessel, R-Anch., would not put a figure on the Senate’s budget target, or an amount of the Permanent Fund Dividend senators might seek.

Giessel did say the Senate is starting its work with the budget submitted the governor on March 13 and making adjustments to it. The House is beginning with the budget developed by former Gov. Bill Walker.

“We haven’t set a goal. The Senate is starting with the budget submitted by the governor and we are evaluating his cuts,” Giessel said. “We’re looking at fewer cuts spread over more years, or not cuts. But we have not yet set a number,” as a target.

Sen. David Wilson, R-Mat-Su, sat in on the briefing with Giessel, said he is getting a lot of emails from constituents who say they will accept a smaller PFD to shore up money for schools, public safety and other services.

“I represent a population base that wants a full ($3,000) PFD, and I’ve always supported that as well. But at the end of the day if a full-dividend isn’t possible a plan that splits they money drawn from Permanent Fund earnings 50-50, so that the peoples’ share is the same as that used for government, seems fair,” Wilson said.

The PFD and the budget total are related. Because there is only so much money available, a higher spending amount leaves only so much money available for the dividend. If spending is cut, more money is available for the PFD.

To achieve a $3,000 dividend that he is proposing, the governor introduced a budget that cuts the state operating budget by about one-fourth. Since both the House and Senate are unlikely to agree to reductions that are so deep, legislative leaders must convince Dunleavy to go along with a smaller PFD.

The governor can reduce the budget passed by the Legislature through his veto power but he can’t force lawmakers to approve a higher dividend. The state constitution gives the power to make appropriations to the Legislature.

Meanwhile, as the budget drama continues the Legislature is moving quickly on a bill that would make $133.4 million in state and federal money available for earthquake repairs. The Senate unanimously approved Senate Bill 38 on Monday, an emergency supplemental appropriation to authorize use of the money for road and building repairs.

The bill also contains $7.9 million for fire suppression. SB 38 now goes to the state House, which is expected to approve them measure.

In a related development, the Federal Emergency Management Administration, or FEMA, has notified the state that the deadline for filing disaster-assistance applications related to the Nov. 30 earthquake has been extended from April 1 to May 1.

The extension was welcomed by the governor. “The spring thaw may uncover earthquake damage to southcentral homes that has previously gone undetected, or will be exacerbated by thawing ground,” Dunleavy said in a statement. So far the state individual assistance program has received 14,594 applications and 6,653 requests have been filed under the federal program.