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Legislature failed to resolve state's financial problems

Posted: Tuesday, May 27, 2003

The just-concluded first session of the 23rd Alaska Legislature, though it consists of hard-working politicians who approved several sound pieces of legislation, should nevertheless be remembered for a single act: failing, like so many Legislatures before it, to resolve the state's long-term financial problem.

Gov. Frank Murkowski, in remarks just hours before the Legislature was set to adjourn, said legislators' unwillingness to approve a sales tax indicates that they want spending reduced further. Alaskans, the governor noted, elected these senators and representatives and therefore support his cuts.

In stating he will indeed follow through with his original budget plan, the governor said Tuesday that the message from the public is clear.

The governor's original budget proposals brought cries of complaint from seniors, educators, parents, social service organizations and local governments. It brought groans from tourism marketing associations, university students and staff, and arts groups. If he follows through with his threatened vetoes of items in the budget sent him by the Legislature, the total trimmed from state spending for fiscal 2004 will be roughly $200 million.

The Legislature seemed to be a better listener, choosing to reject most of the governor's cuts and some of his small taxes and instead send him a budget larger than he requested.

That isn't stopping the governor, though. Alaskans now face the prospect of his program vetoes over the next weeks because of a collision of events:

Neither the governor nor the Legislature will consider an income tax the fairest and easiest way to help close the coming year's budget gap and later ones that are expected to approach $1 billion.

Knowing that, some House members put forward a sales tax an idea loaded with the problems of unfairness, harm to local governments and added cost to businesses. The idea failed and no other one was considered as the House and Senate restored programs the governor recommended be cut.

So, the state will find itself with no significant new revenue to close the 2004 gap and still meet the governor's self-imposed limit on how much can be drawn from the budget reserve.

To the governor, it is crystal clear: The situation indicates support for cuts. Heeding that obvious call, the governor said there will be more reductions next year, perhaps up to $250 million of them. ''We are going to downsize government, make no mistake about it.''

Senators and representatives will soon be back in their home districts. While in Juneau, some expressed a desire to spend part of their summer educating the public about the state's fiscal affairs.

Perhaps the governor should spend the summer traveling to each district. Maybe he'd get an education.

The Fairbanks Daily News-Miner

May 22



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