Hello from Juneau,
This week the State House passed the operating budget,
House Bill 57
, by a narrow caucus-line vote. The Democrat-led majority increased the Governor's requested agency spending, ignored cost-saving amendments, and will force income taxes and the unprecedented draw of $4.2 billion from the Permanent Fund Earnings Reserve.
This budget does not reflect the reality of shrinking revenues and a growing budget deficit.
In fact, the House majority budget increases the Governor's budget by $8.3 million.
Alaskans should know the state's financial situation is at a tipping point. Honest conversations about using the Permanent Fund Earnings Reserve or enacting an income tax are critical now. We face difficult choices, however, with a projected $2.8 billion deficit, budget reductions are not optional, they are a requirement. Well over 100 amendments to reduce government spending were introduced by Republicans on the House floor, all but one were voted down by the Democrat-led majority.
The House Republican Caucus introduced
House Bill 192
in session on Wednesday. This is a practical, long-term fiscal plan that calls for a spending cap, phased budget cuts over four years, and the use of Permanent Fund Earnings, not the principal, within a sustainable and structured framework that protects and grows the fund.
I remain committed to reducing the budget, using earnings from the Permanent Fund ahead of any broad-based taxes, and helping lead Alaska toward a healthy economic future. We will keep you posted on our progress.