Juneau – The Alaska House of Representatives Friday approved a Fiscal Year 2017 statewide operating budget that shaves 10-percent from the current year’s spending levels for day-to-day government services, a historic cut on top of last year’s equal reduction.

“Alaskans spoke clearly: cut first, then look at filling the remaining fiscal gap. That’s exactly what we’ve been doing, this year and last. We’re down 20-percent over the past two years,” said Rep. Mark Neuman, R-Big Lake, and the House Finance Committee’s Chair for the operating budget. “We’re downsizing government and stretching our reserves.”

The budget approved by the House, HB256, reduces “day-to-day” government expenses by 10-percent, and overall unrestricted general fund (UGF) spending by 7-percent. The Majority Caucus members on the House Finance Committee led more than 100 subcommittee meetings on individual state departments, heard from more than 370 Alaskans during public testimony, and focused for the session’s first 50 days on the budget.

“We are leaving no stone un-turned. We are thoroughly scrutinizing the core services, programs and functions of our government,” said Neuman. “With the current fiscal situation, much more work lies ahead as we continue to rethink the size, shape and functions of government.”

Fiscal Year 2017 House Operating Budget Totals

• $8.659 billion in all funds – $639 million less than last year and 30-percent less than FY15
• $4.084 billion in UGF for total operations, including the major formula drivers like education & Medicaid
• $1.835 billion in UGF for just agency operations, the record-tying 10-percent reduction in day-to-day costs

“We brought our costs down significantly this year,” said Neuman. “The more we reduce spending, the smaller our fiscal gap is between revenues and expenditures. The smaller the fiscal gap, the less we have to take from the Constitutional Budget Reserve (CBR) Fund, or the people of Alaska through one of the Governor’s proposed tax bills.

“Statutes also need to change to address state spending,” said Neuman. “As we reduce spending on government, we have got to reduce statutes and regulations. That’s how we continue to shrink government. Reduce the scope of work required by state agencies and government costs less.”

Neuman referenced major reform bills moving through the legislative process, like Medicaid reform, Permanent Fund restructuring and criminal justice reform and reinvestment. “Today marks another good step in reducing our costs and delivering on Alaskans wishes,” said Neuman. “I look forward to the Senate’s work and then Conference Committee.”

Detailed budget documents can be found athttps://www.legfin.akleg.gov/BudgetReports/LY2016/Operating/SelectBudget.php. [xyz-ihs snippet=”Adsense-responsive”]

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