Budget Signals Emerge From State Senate Majority’s First Press Conference

 

The Alaska State Senate Majority held their first press conference today. You can watch it in its entirety below.

If you don’t have a half-hour of free time to watch the whole thing, here are our CliffsNotes version of what was said.

The Budget

Senate President Pete Kelly said, ”The spending limit, the budget reductions, and we will evaluate the use of the [Permanent Fund] earnings reserve, but we are not going to act on the earnings reserve until there is a spending limit in place and proven reductions. I think that is something we all agree on.”

That gives you a good idea of where this caucus is setting the lines for budget negotiations. They are more than willing to pass something along the lines of last year’s Permanent Fund reform bill SB 128, but only if they get a spending cap to go with it.

Oil and Gas Tax Credits

In response to a question of oil and gas tax credits, Senate Majority Leader Peter Micciche said, “We have a couple of operating tenants and one of them is no category of spend is beyond evaluation.” Kelly, however, said nothing could be done that would reduce the amount of oil flowing through the trans-Alaska oil pipeline.

It sounds like there is some disagreement on this issue within this caucus.

Little Mention of the Economy

While there were passing references to oil production, there was little mention of Alaska’s overall economy and no recognition that the state is now undeniably in recession. That is surprising given that any method of closing the multi-billion dollar state deficit will surely cause even greater drag on already faltering state economics.

It’s also odd that the press conference would have so little talk about the Alaska economy when earlier in the day the caucus sent out this press release about how the Senate Labor and Commerce Committee will be holding extensive hearings on the subject over the next two weeks.

Here is the full press conference: