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Alaska lawmakers push back on proposed education cuts

February 18, 2019

JUNEAU, Alaska (AP) — State legislators pushed back Monday against Gov. Mike Dunleavy’s proposed cuts to public education amid an ongoing budget deficit.

Sen. Lyman Hoffman, a Bethel Democrat, called the proposed cuts unacceptable and questioned how districts would be able to absorb them. Sen. Natasha von Imhof, an Anchorage Republican, chided budget and administration officials for no apparent plan to help districts address costs, such as health care.

The Republican governor has proposed more than $300 million in cuts to K-12 school funding and early education programs. Other areas facing potential deep cuts include the University of Alaska system, the state ferry system and Medicaid.

Dunleavy also proposed changes in the collection of certain taxes that would benefit the state but affect local communities. Those include petroleum property and fishery-related taxes.

The Senate Finance Committee has been getting overviews of Dunleavy’s plan.

Sen. Click Bishop, a Fairbanks Republican, asked how cutting school spending would improve performance. Dunleavy’s budget office director, Donna Arduin, said the state has been draining its reserves and needs a balanced budget. Bishop said that was the wrong answer.

Von Imhof said this is what a budget looks like that calls for paying residents a full dividend from the state’s oil-wealth fund, the Alaska Permanent Fund. Dunleavy campaigned on a full dividend, after the payout the last three years was capped.

A law seeking to limit what can be taken from permanent fund earnings for government and dividends projects a $2.9 billion withdrawal for the upcoming fiscal year. Dunleavy has proposed $1.9 billion of that for dividends.

Von Imhof said the public has to decide if that is what it wants.

Alaska has no statewide sales or personal income tax, and Dunleavy has suggested a constitutional amendment that would let the public vote on any new or increased taxes. As a candidate, Dunleavy expressed support for the current oil-tax structure.

Critics of the law seeking to limit withdrawals from permanent fund earnings have said the lawmakers could just ignore that law. But some legislators have said they do not want to overspend fund earnings.

The Legislature began using permanent fund earnings last year after blowing through billions in savings and failing to come to agreement on further cuts or taxes.

In a Monday news conference, Senate Democrats said Dunleavy’s proposed education cuts raise legal and constitutional questions.

Senate Democratic Leader Tom Begich accused Dunleavy of leading from a “place of fear rather than a place of hope” and said many in the state capital do not take his spending plan seriously.

He said regardless of Dunleavy’s position on issues like taxes, lawmakers have an obligation to provide services to Alaska residents in a reasonable way.

Sen. Bill Wielechowski, an Anchorage Democrat, said he’s seeing openness from fellow lawmakers to exploring alternatives to deep cuts. Wielechowski has proposed changes to the state’s oil-tax structure.

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