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Senate approves fiscal 2004 operating budget

Posted: Wednesday, April 30, 2003

JUNEAU (AP) Senate Republicans signed off on a $2.3 billion operating budget Tuesday that restores some of the cuts in education proposed by Gov. Frank Murkowski.

It sets the stage for GOP leaders in the House and Senate to begin negotiations on a final fiscal 2004 spending plan that passes muster with the Republican governor.

But Democrats in the minority, who have largely been spurned during this budget process, vow to continue to push for funding in education and other areas.

The Senate restored millions in K-12 cuts first proposed by Murkowski and also increased the state's foundation formula using money from grants to districts. Democrats say it does not go far enough.

Sen. Kim Elton, D-Juneau, said education spending in the budget does not account for inflationary increases that erode the spending power of districts.

What has happened in the education budget is, we have essentially held the status quo,'' Elton said. What we are essentially doing is sliding backwards in the foundation formula.''

The Senate voted 12-7 in favor of the bill to fund the state operating budget for the year that begins June 30. Seven Democrats voted against the measure. Sen. Bettye Davis, D-Anchorage was absent.

With Republicans in control of both the Legislature and the governor's office, this year's budget debate has been driven by calls to cut state spending.

Murkowski initially proposed a $55 million reduction in the operating budget in an effort to draw less than $400 million from the state's dwindling reserve account.

Earlier this session, the House increased the governor's spending proposal by rejecting some of the most unpopular cuts he proposed.

The bill approved Tuesday trims additional state spending and makes several other changes that will have to be resolved in a conference committee between House and Senate budget negotiators.

Senate Majority Leader Ben Stevens, R-Anchorage, said voters told the Legislature to gain control if its spending. Until we do that, we are not living up to what we are supposed to do,'' Stevens said.

Some of the major budget areas include:

Education. The House restored some of the grants to schools Murkowski had proposed be cut. The Senate proposes a $159 per-pupil increase in the state's foundation formula by using the grants.

Both the House and Senate rejected the governor's plan to reduce the state's share of debt reimbursement to schools.

University of Alaska. Murkowski proposed a $10.3 million increase in university spending. The House cut it but the Senate added $9.5 million back.

Alyeska Central School. Murkowski proposed closing the state's correspondence school to save the $1.2 million cost of its summer school program. The Senate plan cuts the summer school program but leaves the school intact.

Longevity Bonus. Murkowski proposed ending the longevity bonus paid to eligible seniors to save about $44 million, touching off a firestorm from elderly Alaskans who receive it. Both the House and Senate rejected it.

Senate Republicans plan to craft legislation attempting to preserve the program for needy seniors, Senate Finance Co-chairman Gary Wilken Tuesday.

Senate Democrats also railed at the governor's plan to spend the $87 million Alaska Science and Technology Foundation endowment to balance state spending during debate on Tuesday.

A day earlier, Democrats offered several to use ASTF money to increase education spending and funding for other program reductions. All were rejected, mostly along party lines.

Eventually, the Legislature will require a three-fourths vote from lawmakers to balance the state budget with the $1.9 billion Constitutional Budget Reserve. For that, they need the support of Democrats, who have used their leverage in past years to win concessions.

But Democrats are in a tenuous spot this year, since the Republican governor also has line-item veto power to ultimately delete their spending priorities.

Previously, they could count on former Democrat Gov. Tony Knowles to back any budget deal. Senate President Gene Therriault, R-North Pole, said he doesn't favor any deal that increases state spending.

Unfortunately, the minority had a governor that would use that leverage ... on that blackmail provision,'' Therriault said. I'm not interested and they don't have a governor anymore.''



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