The Capitol Report
By Miles Baker
Associate Vice President Government Relations
January 26, 2018
Greetings from Juneau and welcome to the 2018 Capitol Report.
Last Tuesday, state lawmakers gaveled-in to begin the second session of the 30th Alaska Legislature. After a record setting 217-day session last year, legislators have a full agenda facing them in the coming months.
Your university team is hard at work in Juneau, and we encourage you to stay engaged as the session continues. In addition to advocating for the Board of Regents FY19 operating budget request, we will be working to reauthorize the Alaska Education Tax Credit, secure funding for deferred maintenance, and show policymakers the value university research adds to Alaska and our economy.
Throughout the session we’ll provide you with updates on happenings in Juneau, and keep you informed about what you can do to advocate for our university. We’ll also be enhancing the information and resources available on the UA Government Relations webpage at www.alaska.edu/state. Please check back on a regular basis, and feel free to contact us if you ever have any questions or comments.
Alaska’s fiscal challenges have compounded over the past several years and will require consequential decisions by lawmakers this session. For the seventh year in a row, the state’s general fund revenues have not been sufficient to cover annual operating expenses. Declines in both oil production and price reduced Alaska’s unrestricted general fund revenues from $9.5 billion in FY12 to just $1.3 billion this past year.
Large deficits over recent years forced dramatic reductions in state spending and drained $14 billion from the state’s savings accounts. Although oil prices and production levels have risen slightly, the state still faces a FY19 deficit of $2.5 billion. The state’s two primary savings accounts, the Constitutional Budget Reserve and the Statutory Budget Reserve, do not have adequate funds to cover this year’s deficit. Finding fiscal solutions to this issue will be the focus of the session. Governor Walker stressed the importance of fixing state finances in his State of the State address last week.
The governor also used his speech to emphasize to legislators the importance of the University of Alaska and laud its work:
“An excellent education system also requires a strong university system. Faced with unprecedented budget challenges, the University of Alaska has made drastic cuts. But under the capable leadership of the University of Alaska Regents and administration, the university continues to produce well-prepared graduates and excellent programs.”
Advocating for the university’s annual operating and capital appropriations is my most important task. As you know, our budget has been cut by $61 million (16%) over the last four years and we expect continued pressure from the legislature this year. The Governor’s operating budget proposal holds our funding at last year’s $317 million level, $24 million below the Board of Regents’ $341 million request.
For the second year in a row, the Regents have requested $50 million in capital funds to address the university’s $1 billion deferred maintenance/renewal & repurposing backlog. While the Governor did not request funding for the university in his FY19 capital budget, he has introduced the Alaska Economic Recovery Plan that would fund maintenance and public works around the state, including the university. The initial proposal is linked to a new 1.5% payroll tax.
This week legislative committees began to ramp up. Our university team was involved in hearings on economic and workforce development. We are the largest trainer of Alaskan workers, and university staff participated in hearings on the state’s Technical Vocational Education Program (TVEP).
The House has begun operating budget hearings. University President Jim Johnsen has met with the legislative leaders and will appear before the House Finance Committee this Monday January 29th at 1:30 p.m. to present the university’s FY19 operating budget. The following afternoon President Johnsen will appear before the university’s budget subcommittee at 4:30 p.m. You can stream both hearings online at www.gavelalaska.org or at akl.tv, or watch it on television on 360 North.
As we begin this legislative session, I’d like to thank you for all the time and energy you put forward on behalf of our university. This year I’m happy to announce Weston Eiler has joined the Government Relations office in Juneau. Weston previously worked for the Legislature for nearly 10 years, and will be an asset to us as we communicate our message to lawmakers. The two of us are here to bring our collective efforts together to advocate for our university. Our university is full of passionate and knowledgeable professionals who are ambassadors for UA and its mission. I hope I can continue to use you as a resource, and trust you will do the same.
Please let us know if you ever find yourself in Juneau or receive questions from legislators about the important work you’re doing. The university maintains its office in the historic Ebner Building just across the street from the State Capitol, and we’re here for you. I can be reached at:
227 4th Street