- Associated Press - Thursday, February 12, 2015

JUNEAU, Alaska (AP) - Members of the House Finance Committee pushed back against parts of Gov. Bill Walker’s budget plan Thursday, questioning if some of the cuts he identified were truly reductions.

Among the areas of focus was Walker’s proposal to forward-fund education for 2017 at 90 percent. While work is underway on the fiscal year 2016 budget, the state has been forward-funding education to allow districts to plan.

Walker, in his State of the Budget address last month, proposed forward-funding at the reduced level, saying funding could be addressed next session after the completion of school funding studies due by mid-June. The studies were called for as part of an education bill passed last session. Walker’s budget director, Pat Pitney, reiterated that position Thursday.

But some committee members questioned the approach. Co-chair Mark Neuman, R-Big Lake, said there might be less money to work with next year, and he said lawmakers might want to prefund the full amount.

Legislative Finance Division Director David Teal said “short-funding,” as he referred to it, can make the deficit for next year look smaller. “And now more than ever I think it’s critical that you don’t fool yourselves or fool the public by understating the deficit,” he told the committee.

Members also questioned the administration’s decision to include in the budget program cuts reflecting projected savings attributable to Medicaid expansion, when the state has not opted for expansion yet. There were concerns, too, with the potential impacts on other agencies of a proposal to cut community jail contracts.

While Walker has made Medicaid expansion a priority, a number of lawmakers are worried about the future cost.

The state is facing projected deficits of about $6.9 billion between this year and next amid a crash in oil prices. Cuts alone aren’t expected to fill the gap, and the state plans to use savings to get by. Spending levels and oil prices will help dictate how long those savings last. The situation isn’t expected to be resolved this session.

Neuman said it would be very difficult to try to cut $1 billion from the budget within the confines of the 90-day legislative session because there is risk with that of simply chopping up government. Neuman said that’s not to say that it couldn’t be done. Neuman said the state will have to cut as much as it can this session - a number of lawmakers have said they’d like to see cuts deeper than those proposed by Walker - “but then the hard part comes,” essentially rebuilding a government that the state can afford.

He said in an interview that he wants a plan in place by the end of session for dealing with the deficit.

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