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Lawmakers differ with Dunleavy on state budget

Alaska Gov. Mike Dunleavy said he was proud of his proposed fiscal year 2023 budget, but lawmakers worry the governor is not thinking about the future.

Dunleavy said during his state of the state address that Alaska’s financial situation has improved since he took office, when the budget deficit was $1.6 billion.

“Thanks in part to our fiscal restraint over the past three years, we’re on track for a budget surplus in the current fiscal year for the first time in a decade,” Dunleavy said Tuesday. “Based on current trends, we could see revenue in the current year increase by more than $281 million over the fall forecast and by $466 million in the upcoming fiscal year.”

State revenues are based in part on oil prices, which have increased, but those prices may not hold, lawmakers said.

Senate Minority Leader Tom Begich said in response to Dunleavy’s address that basing a budget on the stock market and the volatile price of oil “is not a sustainable plan for our next generation.”

“It was this governor who attempted to dismantle the university system, cut public education funding and put the state fiscal burden on local taxpayers in his first budget,” Begich said. “We are all encouraged now by a budget that rejects that vision. But if we don’t work toward a sustainable and comprehensive fiscal plan, the Alaska that we all cherish will become even more divided by partisan and election politics.”

Republicans also are questioning Dunleavy’s proposed budget.

“I think we need to look further forward than fiscal year 2023,” Sen. Bert Stedman, R-Sitka, said at a recent meeting of the Senate Finance Committee. “We’re fortunate today to have higher oil prices, and we may not be so fortunate six months from now or a year from now, or two years from now.”

Stedman, who co-chairs the committee, questioned the use of federal relief funds in the fiscal year 2022 and fiscal year 2023 spending plans.

Dunleavy’s proposed budget includes $375.4 million of discretionary funds from the American Rescue Plan Act for revenue replacement. An additional $37.4 million is set aside for operating investments, and $72 million is allocated for capital projects.

Stedman asked whether some of the money could be saved and said there was the possibility “we walk our state into significant taxes and huge deficits.”

This article was originally posted on Lawmakers differ with Dunleavy on state budget

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