Alaska Legislature Passes Budget with Increased School Funding and $1,300 PFD

Alaska Legislature Passes Budget with Increased School Funding and $1,300 PFD

Members of the House Minority leave the chamber after passing the budget
Members of the House Minority leave the chamber on Thursday, May 18, 2023, after passing the budget. (Lex Treinen/Alaska Public Media)

The Alaska Legislature has reached a budget agreement on the first day of the special session. This deal includes a remarkable $174 million increase in funding for public schools, as well as a $1,300 Permanent Fund dividend for residents. The agreement comes after a failed attempt to pass the budget during the regular session, when the House adjourned without even voting on the Senate’s proposed budget.

Negotiations and Local Projects

Senate leaders engaged in negotiations with the House late into the night and throughout the day. Ultimately, the budget deal incorporated an additional $34 million for various local projects, specifically catering to the House members. Senate President Gary Stevens, a Kodiak Republican, mentioned that the budget deal was greatly influenced by the list of capital budget requests provided by the House Majority. Consequently, the majority of projects in the budget were derived from this list.

The budget caters to multiple important initiatives. It allocates funds for a new roof for the Palmer Library and addresses issues such as the Mary Avenue storm drainage system in Anchorage and harbor float replacements in Dillingham. Additionally, it assigns $7.5 million for child care grants and the same amount for a new program that will enhance local medical care options.

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Senate Finance Co-Chair Bert Stedman introduces an amended budget on the Senate floor as House Minority members watch.
Senate Finance Co-Chair Bert Stedman (R-Sitka) introduces an amended budget on the Senate floor as House Minority members watch. (Lex Treinen/Alaska Public Media)

Positive Implications for Alaska

The passing of this budget is a significant achievement for Alaska. House Rules Chair Craig Johnson, an Anchorage Republican, expressed his satisfaction by stating, “It’s a good day for Alaska. Our communities will be taken care of. They’ll have public safety, fire protection, they’ll have road graders this winter.”

However, due to the intense focus on the budget during the last few weeks of the regular session, several high-profile bills did not receive attention and were not passed. One such bill aimed to reform involuntary commitment laws for mentally incapacitated individuals, while another sought to implement a program to pump greenhouse gases back into the ground.

Lessons Learned and Future Productivity

Senate President Gary Stevens acknowledged the lessons learned from this legislative session and expressed his desire for increased productivity in future sessions. “The lesson is: follow the schedule,” Stevens said, emphasizing the need for all members of the Legislature to adhere to the predetermined session timeline. Similarly, House majority leaders have taken note of the challenges faced during this session and have committed to better preparation and improved efficiency moving forward.

Permanent Fund Dividend Disputes

Throughout the regular session, the House and Senate were divided over the size of the Permanent Fund dividend (PFD). The House proposed a dividend of $2,700, more than double the ultimately passed amount of $1,300. However, House leaders were unable to gather sufficient votes to tap into savings in order to pay for the larger dividend. The final budget includes a provision to pay an additional $500 if oil prices exceed predictions.

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Legislative staff bring copies of an amended budget from the Senate to House floor
Legislative staff bring copies of an amended budget from the Senate to House floor on Thursday, May 18, 2023. (Lex Treinen/Alaska Public Media)

Legislative and Public Response

While some representatives expressed disappointment with the final size of the PFD, they acknowledged the importance of compromise. “Would we have liked it to be higher? Well, absolutely,” said Rep. DeLena Johnson, a Republican from Palmer. “But you know, you can sometimes only get to meet in the middle.”

The budget bill received overwhelming support in both the Senate and the House, with the Senate voting 15-1 in favor and the House voting 26-14. All members of the House Minority voted in favor, while the Republican-dominated Majority was divided. Majority Leader Cathy Tilton, R-Wasilla, voted against the bill. Notably, this budget is the first to pass through concurrence instead of going through a conference committee between both chambers since 1982.

Governor’s Decision and Future Discussions

The budget now awaits the governor’s approval, as he has the power to veto the bill. Governor Mike Dunleavy, currently on a charity bear hunting trip, has not made any public comments about the budget. However, it is expected that he will call a special session in October to discuss new tax initiatives.

This budget agreement serves as a significant step forward for Alaska, ensuring increased funding for public schools and providing a substantial Permanent Fund dividend to its residents. It signifies the Legislature’s commitment to addressing important local projects and prioritizing the needs of Alaska’s communities. With valuable lessons learned from this session, both the House and Senate are poised to enhance their productivity and better serve the people of Alaska in future sessions. If you want to explore more about Alaska’s beautiful landscapes and adventure opportunities, check out East Coast Paddle Sports.

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