House panel restores some money, denies more

Posted: Wednesday, March 08, 2000

JUNEAU (AP) -- The House Finance Committee restored $1 million to alcohol and drug abuse programs and nearly $1 million to the Department of Transportation on Tuesday but rejected pleas to undo cuts to state parks, tourism development and international trade support.

The biggest loser as the committee wrapped up its work on state agency operating budgets for the coming fiscal year was the Department of Community and Economic Development.

A subcommittee had made deep cuts in the department's tourism and international trade offices, and attempts to restore that money in the full committee failed.

The cuts to international trade will close trade offices in Japan and Korea and eliminate nine of the division's 12 employees, said Deputy Commissioner Jeff Bush. The two countries are Alaska's biggest trading partners, accounting for more than 70 percent of the state's exports, said Bush, whose job was also threatened by the cuts.

An attempt to restore $916,700 to the division's budget failed 5-6, with two majority Republicans joining the three minority Democrats in support.

''We're going to lose a lot of business development as a result of this retreat from this particular marketplace,'' said Rep. John Davies, D-Fairbanks.

Rep. Eldon Mulder, the co-chairman of the committee, said he had conducted an informal survey of the state's largest exporters and found little dependence on the state offices.

''It's a wonderful luxury to have in times of prosperity,'' said Mulder, R-Anchorage.

The Republicans who control the Legislature want to cut the budget by $30 million as a response to the gap between state spending and normal revenue. Minority Democrats denounce the cuts as an inadequate response and call for a long-term solution to the budget gap such as an income tax.

The committee later restored $70,000 for a single general trade specialist and $111,700 for a deputy commissioner.

The subcommittee also cut $441,000 from the department's tourism planning and development program, virtually eliminating it, Bush said.

The cut was an aftershock from a bill passed last year that will transfer the state's tourism marketing effort to a contract with a private trade association.

As part of the agreement when the bill passed, the agency was supposed to get an increase of about that much money to pay for development and planning and to oversee that contract, Bush said. Instead, the subcommittee denied the increase and transferred the money into the contract itself.

An attempt to transfer the money back failed 5-5, the closest vote of the day.

Most attempts to put money into the budget failed by wider margins.

Davies' attempt to increase the Department of Environmental Conservation's food service inspection program by $358,800 failed 4-6. Davies argued the money is needed to increase the frequency of inspections that now happen less than once a year.

''I just think that's an unacceptable position to be in,'' Davies said.

Republicans argued that the program needs to improve with its current budget.

''I will not support throwing more money at this broken program,'' said Rep. Bill Williams, R-Saxman, who headed the department's subcommittee.

A proposal to restore $280,000 to the Department of Natural Resources to keep parks open also failed 4-6. The department estimates the cut will force the closure of 15 to 20 percent of the state's parks.

''I don't understand why we're proposing to cut this,'' Davies fumed. ''These are places that families can go and do some fishing.''

Rep. Con Bunde categorized the parks as a luxury.

''While we have lots of needs, I guess this falls in the wants area,'' Bunde said.

Maintenance of state roads and airports apparently qualified as a need. Faced with the impacts of about $2 million in cuts to the Department of Transportation, the committee used a money-shuffle.

The switch took $600,000 in general funds from the Department of Corrections. That money was replaced with $600,000 from the forfeited Permanent Fund dividends of imprisoned felons.

The committee also allowed the department to raise $350 million from tolls on the new road to Whittier. A subcommittee had recommended keeping the tunnel into Whittier closed to save money.

But department Commissioner Joe Perkins planned to open the road anyway, and threatened to cut maintenance to rural roads and airports to make up the difference.

''I don't like any of these cuts, but in our priorities, these are the ones that should go,'' Perkins said.

Another swap restored $1 million of a $1.5 million to the Department of Health and Social Services' grants to alcohol and drug abuse programs. Money from the state's mental health trust was diverted to pay for Medicaid, freeing up $1 million for the alcohol and drug abuse programs.

Subcommittees last week handed in agency budgets totaling $2.11 billion -- $23.5 million less than the current fiscal year and $105 million less than Gov. Tony Knowles has requested, according to the Legislative Finance Division.

However, three major issues have not been decided: the University of Alaska, state aid to local governments, and newly negotiated state employee contracts.

Davies withdrew an amendment to increase the university budget by $16.9 million after Mulder promised to work for an increase later in the budget process. He also withdrew an amendment to pay for nearly $23 million in state employee pay increases after Mulder said he wanted more time to study the contracts.

The budget is expected to go before the full House next week, where minority Democrats will try again to amend it.



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