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GOP majority rejects minority budget amendments

Posted: Thursday, March 16, 2000

JUNEAU (AP) -- Republicans in the House used their superior numbers Wednesday to block money for the University of Alaska, aid to local government, rural power subsidies and international trade development.

The House Finance Committee's proposed operating budget for the fiscal year that begins July 1 includes nearly $2.17 billion in spending from the state's general funds, about $26 million less than the current year, according to the Legislative Finance Division.

The Legislature's GOP majority hopes to cut $30 million as a response to the state's budget gap. Gov. Tony Knowles had proposed a $100 million increase, mostly aimed at education and child protection programs.

In a debate that ran late into the night, minority Democrats unsuccessfully offered more than 20 amendments aimed at restoring that spending, including a $16.9 increase for the University of Alaska.

''It's a minor investment in assuring that this state meets the challenges that are coming in the next century,'' said Rep. Tom Brice, D-Fairbanks.

Both Republicans and Democrats argued for the increase, saying it was essential to prevent Alaska students from fleeing Outside for school.

''We can continue to export brain talent to the Lower 49, or we can improve our university system to keep it here,'' said Rep. Hal Smalley, D-Kenai.

The amendment failed 16-20, with three majority Republicans joining 12 Democrats and dissident Republican Vic Kohring to vote yes.

However, money for the university is expected to remain an issue as the budget moves to the Senate, and House Finance Committee Co-Chairman Eldon Mulder described its allocation as ''a work in progress.''

''We're looking at trying to find another way, another means to find another source of money for the university,'' said Mulder, R-Anchorage. Several proposals for getting more money to the university are pending in the Legislature, mostly aimed at endowing it with large tracts of state land.

A bid to restore $3.4 million cut from the aid the state sends to local governments came the closest to adoption. Local officials have protested ongoing cuts to the program, saying they simply shrug the state's financial problems off on local taxpayers.

''When you cut municipal assistance, you raise local taxes,'' said Rep. Ben Grussendorf, D-Sitka.

The Legislature cut the program by one-third last year, to about $32 million, but $3.4 million of that money came from a one-time source, Mulder said.

One Republican noted that municipalities have gotten used to an unusual level of support from the state, which provides many services handled locally in other states.

''We contribute far more as a state to local services than any other state,'' said Rep. Andrew Halcro, R-Anchorage.

The amendment failed 18-18, perhaps displaying the vulnerability of this year's smaller majority. The Democrats were joined by Anchorage Republicans Ramona Barnes and Pete Kott, both members of the majority, and all four of the dissident Republicans.

Bethel Democrat Mary Kapsner appealed to urban lawmakers to approve another $9.5 million from the general fund to pay for Power Cost Equalization, the subsidy the state pays to offset high electrical rates in the Bush.

A proposal to pay for the program with income from the National Petroleum Reserve Alaska lease sale has bogged down in a conflict with another program that gets first crack at the money.

Kapsner spoke longingly of Anchorage's nickname -- the City of Lights.

''I wish that I could represent even one community that could call itself the city of lights, or the village of lights, or the town of lights,'' Kapsner said. ''It's just too expensive.''

The amendment failed 16-18 after Mulder again said that a fix for the program was in the works. Mulder criticized the North Slope Borough, which has proposed so many projects eligible for NPRA money that money will likely not be available for power subsidies.

''It's going to require the North Slope Borough to give up its wish list so we can fund a necessary program,'' Mulder said.

Rep. Reggie Joule, D-Kotzebue, came to the borough's defense, saying Mulder's proposal ''pits one part of rural Alaska against another part of rural Alaska.''

House Minority Leader Ethan Berkowitz tried to restore money for the state's trade development offices in Japan and Korea, which are slated for closure.

''If we cut trade offices, we're going to wind up cutting trade, and if we cut trade we're going to do some grievous harm to Alaska businesses,'' said Berkowitz, D-Anchorage.

Bunde described the offices as a luxury the state can no longer afford.

''Some of us might consider this just a subsidy,'' Bunde said.

The House also rejected amendments to restore $19 million in state support for local school districts. The formula the state uses to calculate school aid automatically cut some districts in response to dropping enrollment and increasing local property values.

Another proposal to increase grants to improve school quality by $7.5 million was also defeated. A bill pending in the Finance Committee would accomplish the same goal.

Debate was expected to last far until early Thursday. A final vote on the measure was scheduled for Thursday.



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