Alaska lawmakers sent a letter to Governor Bill Walker this week urging measures to rein in budget items.
Incoming Senate President Kevin Meyer, a Republican from Anchorage and House Speaker Republican Mike Chenault of Nikiski signed the letter, along with the chairs of the finance committees for both chambers. The letter lays out suggestions such as a hiring freeze for all state departments, limiting agency travel and requesting department budgets for the first six months of 2015.
Senator Meyer says lawmakers only have 90 days to do their work and they’ve not seen the Governor’s plans.
“We’ve heard all kinds of things during the campaign that he wants to add to education and add to the Medicaid expansion but yet he wants to make 15, 16% across the board reductions, and I don’t know that those are accurate in today’s environment so we just want to see what his expectations are. It’s more of a courtesy thing, just that the sooner we can get this information, the better,” he said.
Meyer says ideas like a hiring freeze may not be possible in all departments, such as public safety or corrections but the desire is to get clarity from the Walker administration about what could be coming.
“A statement to that effect would help us send the message out to the general pubic that we have a major budget deficit that we’re serious about addressing and we want to incorporate everyone’s thoughts and ideas on it and especially the governor’s,” Meyer said.
Other ideas are to look at capital appropriations that are more than five years old to see if that money could be re-appropriated to other, more pressing needs. Meyer says Office of Management and Budget figures show between three and four billion dollars in capital projects that are encumbered but not yet spent.
As others have acknowledged, Meyer says Alaska has seen large fluctuations in oil prices in the past and as recently as the late 90s and early 2000s, there were deficits to be dealt with.
“In the past the problem, in recent years was production, the price was high, but now we have a problem with both price and production,” Meyer said.
He says lawmakers hope the gas pipeline project will stay on track so production can add to state revenue in a decade.
“Our gas looks good because it can replace coal in China and nuclear in Japan, but oil is always going to be around and countries like the Middle East and Russia will make sure that they’re around and as economies rebound in Europe and China, the demand is going to grow so I do see the prices will go back up but when is anybody’s guess,” Meyer said.
Governor Walker sent a letter today asking all commissioners to identify potential cuts to their departments by January 10th.
A statement from Walker’s office says in part that Walker shares the concern about a need for action, and that he and his team have been in nearly daily budget meetings for several weeks.