22nd Alaska State Legislature
News from the Senate and House Majorities

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Sen. Dave Donley
State Capitol, Room 508
Juneau, AK 99801-1182
Phone: (907) 465-3892
Fax: (907) 465-6595

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Rep. Eldon Mulder
State Capitol, Room 507
Juneau, AK 99801-1182
Phone: (907) 465-2647
Fax: (907) 465-3518

State Budget Holds Line on New Spending
Plan Funds Alaskans' Priorities, Avoids Worsening Fiscal Gap

Released: May 15, 2002
Contact: Senator Dave Donley at (907) 465-3892
Representative Eldon Mulder at (907) 465-2647

(JUNEAU) The House today gave the Legislature's final approval to an operating budget Tuesday that holds the line on growth in government spending, while building for the future by expanding state investment in education, public safety and transportation.

The House concurred with conference committee changes to House Bills 404 and 403, the vehicles for the operating budget. HB 403 appropriates $2.28 billion from the general fund for the 2003 fiscal year, which starts June 30, 2002. The budget is about $1.5 million less than last year's spending plan, but is more than $166 million lower than the governor's proposed operating budget - a 6.8 percent difference.

"The budget is the state's major policy document, and our policy has been to resist pressures to expand overall government spending in the face of the imbalance between revenue and expenses," said House Finance Committee Co-Chair Eldon Mulder (R-Anchorage). "By holding the line on new spending and investing in our priorities, we can both educate the next generation of Alaskans and ensure there is a viable economy in Alaska for them to work in."

"We have held the line on general fund spending," said Sen. Dave Donley (R-Anchorage), co-chair of the Senate Finance Committee. "The Senate Majority has fulfilled its commitment to an operating budget which addressed crucial services while holding general fund spending to a lower level than last year."

"Given the systemic problems with Alaska's public financial system," Donley explained, "it is imperative that the state maintain fiscal discipline and resist new government spending."

In passing the budget bills, the House and Senate invested in the state's priorities:


  • Fully funds K-12 educational support programs at $678.8 million
  • Fully funds pupil transportation costs of $53.9 million, a substantial increase
  • Adds $10.8 million in Learning Opportunity Grants to provide a total of $23.3 million to help students and schools prepare for the high school exit exam and for educational benchmark tests
  • Adds $58.6 million in additional appropriations to the University of Alaska, including $10.3 million in general funds - the fourth year of increases for the University


  • Expands the state highways and aviation programs by $9 million, for a total of $86.8 million
  • Provides $6.2 million for transportation planning, a $300,000 increase
  • Approves $27.1 million for design and engineering services, a $3.2 million increase
  • Spends $31.8 million on construction and capital improvement projects, a $2.1 million increase
  • Adds $778,000 to the state's equipment fleet budget, for a total of $20.3 million
  • Boosts the international airport system with $2.3 million, to a total of $45.7 million

Public Safety

  • Increases Alaska State Trooper detachment budgets by $3.8 million, to $38 million
  • Boosts Fish and Wildlife enforcement by $300,000, to $11.8 million
  • Adds $535,000 to the Fish and Wildlife aircraft protection section for a total of $2.6 million
  • Increases fish and wildlife marine enforcement efforts by $60,000, to $3.2 million
  • Authorizes $3.1 million for the criminal investigations bureau, an increase of $74,000
  • Adds $35,000 to state search and rescue services, to a total of $368,000
  • Bolsters Alaska criminal records and identification services by $360,000, to $3.6 million

Social Services

  • Authorizes $257.7 million for state and federal shares of Medicaid services
  • Approves $18.1 million for foster care services, a $650,000 increase
  • Adds $1.6 million for subsidized adoptions and guardianships, for a $14.6 million total
  • Increases front-line social worker funding by $3.3 million, to $23.3 million
  • Dedicates $23.4 million to juvenile justice facilities, a $696,000 increase
  • Directs $4.5 million to tobacco prevention and control programs, a $3 million hike, plus $500,000 for enforcement of anti-tobacco laws and $1 million for Medicaid services to treat tobacco-related illnesses

In passing a budget that represents no general fund increase from last year's, the Legislature asked state departments to absorb increasing costs, such as growth in formula-driven programs, some federal mandates, and a third year of raises for state employees. But increases in priority areas were possible by maximizing revenue sources other than general funds.

"Once again we found ways to prioritize essential services, while rejecting the governor's requests for massive spending increases," Donley said. "The governor started the session wanting to put the Republican majority 'in a box' on the budget. He challenged us to find ways to reduce spending and that is just what we did."

The budget also includes provisions designed to improve accountability and efficiency. The continued missions and measures program establishes clear standards for what each state department should achieve, so the state can dedicate resources to government functions that work, and redirect them away from those that do not, Mulder said.

Likewise, state agencies will be required to track and report to the Legislature how much of their budget is spent in the first half of the fiscal year, to ensure agencies practice budgetary restraint, instead of overspending their budgets, then seeking supplemental appropriations to cover the cost.

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| Sen. Donley's Page | Rep. Mulder's Page |
| Senate Finance Committee's Page | House Finance Committee's Page |

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