Methods of funding state's public works budget considered

What others say

Posted: Wednesday, April 27, 2005

In the continuing debate over the public works budget for the coming fiscal year, legislators and the governor have been in general agreement that the time is right for Alaska to have a fairly substantial one.

But reaching agreement on how to pay for it has had viewpoints as far apart as proposed harbor repairs in Southeast and school renovations in the Northwest Arctic.

Legislators shouldn't — and by most accounts won't — let this opportunity pass for making a major investment in infrastructure. The items proposed so far touch on most every region of the state and make fixes and upgrades to past projects while also building for the future, especially in preparatory work for construction on the hoped-for natural gas pipeline from the North Slope.

With only three weeks remaining in the legislative session, House and Senate, Republicans and Democrats, and the governor himself, have yet to settle on a method of paying for the extensive work list. Progress is reportedly being made, but all of the most-discussed options would do the state well.

... Gov. Frank Murkowski began the session by proposing a $1.4 billion capital budget, which contains nearly $800 million in federal money among its many funding sources and is heavy on transportation projects. DOT, including all funding sources, gets about 58 percent of the money in the governor's budget.

But the governor's proposal, Senate Bill 46, contains his controversial idea to provide some of the money by issuing bonds to support some of his transportation projects and to pay them off by spending the interest earned from a special pot of lawsuit settlement money — known as the Amerada Hess funds — that is held in the Alaska Permanent Fund.

That idea, however, hasn't excited enough lawmakers, many of whom seem to fear punishment from voters if they agree to use this pot of Amerada Hess money — even though the money is doing nothing now, is not considered as earnings on the main permanent fund, and is not a factor in dividend calculations for legal reasons.

So, regrettably, cross that funding idea off the list.

The Senate, meanwhile, recently approved a $300 million-plus partial capital projects bill that is almost exclusively related to education, both for the K-12 and University of Alaska and provides more in that regard than the governor's bill, which is still needed to meet the rest of the state's construction needs. But that idea ... suffers from an ailment similar to that afflicting the governor's proposed capital budget: It would use money associated with the permanent fund, in this case, the earnings of the main fund.

... So strike that fine idea from the list, too.

... Alaska has an opportunity to take advantage of its present financial situation to have a construction budget that includes the Republican and Democratic goal of paying for all of the Department of Education's major maintenance projects, provides for the governor's transportation aims, allows for expansion and upgrades at the University of Alaska, and more.

At this time, and with the days ticking by, Alaskans and their elected officials in Juneau should be open to all of the stated funding sources.

— Fairbanks Daily News-Miner,

April 24

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