Dunleavy and ‘State of the State’:An upbeat governor defends his record in front of Legislature

Gov. Mike Dunleavy’s annual “State of the State” speech to the Legislature was upbeat, citing accomplishments of his administration despite the pandemic and other challenges.

The governor, who is is running for reelection in 2022, spoke to lawmakers last Tuesday, Jan. 25.

Here are highlights:

Finances

The state is in good financial condition. Dunleavy said he inherited a $1.6 billion deficit when taking office in 2018. “Thanks in part to our fiscal restraint over the past three years we’re on track for a budget surplus for the first time in a decade,” the governor said.

“My proposed budget for state spending in the next fiscal year is 7 percent less than the 2019 budget in place when I took office.”

Surpluses are projected this year and next even without one-time federal funds, Dunleavy said.

Rising oil prices had something to do with improved finances, he acknowledged. “In the last two years we’ve seen oil prices go from negative to nearly $90 per barrel,” he said.

“Our Permanent Fund is now worth almost $82 billion,” and its performance has helped the state smooth out highs and lows in oil revenues, and a multi-billion-dollar pension gap is virtually closed, which frees up revenue that can be devoted to core government responsibilities.

Understandably, the governor highlighted the upsides but didn’t mention big bumps of his first year in office when he slashed spending so deeply and quickly that it prompted a feisty recall campaign that, but for the pandemic, might have gathered more steam.

The governor backed off on the most drastic reductions, however, such as to the University of Alaska.

Crime

Thanks to justice-reform legislation, which happened early in Dunleavy’s watch as governor, crime dropped 10 percent in 2019 and 18.5 percent in 2020. Property crime rates are at the lowest rates since 1974.

Murder dropped 31 percent from 2019 to 2020. In 2020 vehicle thefts were down 54 percent in 2020 compared with 2017; burglary dropped 22 percent from 2019 to 2020; robberies were down 15 percent over the same period.

The crime reform measures were mainly a product of legislative initiatives but the governor provided important support.

The pandemic

Despite the huge stress of the pandemic, the state’s health care sector has shown resilience, Dunleavy said in his speech.

Alaska has led the nation in testing and vaccine distribution as well as distribution of therapeutics such as monoclonal antibodies, the governor said.

Resources were brought to bear to ease health care workforce shortages, he said, including bringing 500 temporary professionals to the state in fields from nursing to respiratory therapists.

Three new health care initiatives included work with the state Board of Nursing and hospital association to recruit and retain over 600 Certified Nursing Assistants; a $2.1 million grant to the University of Alaska Anchorage nursing school to train and graduate more registered nurses, and money requested to expand the University of Washington and University of Alaska medical training collaboration, or WWAMI, by 50 percent. WWAMI is an acronym for Washington, Wyoming, Alaska, Montana and Idaho, five states that are in the effort, which is led by the University of Washington School of Medicine.

Dunleavy and the chief state medical officer, Dr. Anne Zink, are also credited with having a calming influence on the public early in the pandemic through weekly televised briefings and question-and-answer sessions.

Despite criticism of his reluctance to push more aggressive initiatives, like mandates to wear masks and for vaccinations, Dunleavy defended his administration’s performance through the pandemic so far.

Although 1,039 Alaskans have died of COVID-19, of the 194,000 cases of infections identified to date nearly 99.5 percent survived, he said in his speech last Tuesday.

“We recognized early on that specific populations were more vulnerable to this virus than others, particularly our elders and those with underlying heath issues, and some residents of our remote communities with limited health care infrastructure,” Dunleavy said.

“By any measure, history will reflect that our actions helped us achieve some of the best outcomes in the nation,” in battling COVID-19, he said.

As to the criticism, “My administration will continue to defend Alaskans’ rights to make their own medical decisions about vaccines and therapeutics for themselves and their families in consultation with their doctors and pharmacists,” Dunleavy said in the speech.

Permanent Fund Dividend

Dunleavy closed his speech with a renewed pitch for his Permanent Fund Dividend, or PFD, plan, which would pay larger dividends.

“I agree with former Gov. Jay Hammond (who helped found the Permanent Fund) that the government should never take more from the Permanent Fund than is distributed to the people,” through the dividend, the governor said.

To that end, Dunleavy’s “50-50” plan would create a dividend that would distribute half through the PFD of the Permanent Fund’s annual contribution of its earnings to support public services. The proposal would add certainty to how much is distributed. Currently the dividend is funded ad hoc by the Legislature, leaving people, “wondering how we’ve come to a place where the PFD is nothing more than what’s left over after government takes the lion’s share,” of the Fund’s earnings, Dunleavy said.