State Budget Holds Line on New Spending
(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:
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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