Reality Check w/ John Tracy: Fixing Alaska’s budget gap
To listen to pundits, the state is in the throes of a fiscal crisis. I can give you 11 billion reasons why that isn’t true.
$11 billion is roughly the amount we currently have in the state’s savings accounts, not even counting the Permanent Fund. What we have is a budget gap, and yes, it’s serious.
First, some basics.
The state runs on a fiscal year, basically July to July. Alaska ended last fiscal year with a $2.7 billion deficit. Lawmakers filled that by all but emptying the Statutory Budget Reserve.
This year’s budget deficit is projected to be $3.7 billion, if oil prices stay as they are. Lawmakers filled that gap by emptying the Public Education Fund, and pulling almost $3 billion from the Constitutional Budget Reserve.
Think about it: in just two years, we will have drawn more than $6 billion from our savings accounts to balance the budget. And when next July rolls around, we’ll have around $7 billion left.
What that means, is if we do nothing, our savings will be gone sometime in 2018 — a little over 2 years from now.
The left wants to raise taxes again on the oil industry. The right wants to see deeper spending cuts. The fact is, neither would put a dent in the deficit. The Legislature’s own analysts say you could eliminate every state job, and still be nearly $2 billion short.
The Walker Administration is doing it’s best to convince Alaskans the state needs new revenues soon to close the gap before our savings are gone. That means taxes, or earnings from the Permanent Fund.
But that’s not likely to happen this year.
Lawmakers have been up front about saying they won’t discuss revenue options while they’re up for re-election.
To sum it up, we have more than $11 billion in savings, and more than $52 billion in the Permanent Fund.
A fiscal crisis — we don’t have one.
But without a plan, I can almost guarantee that in two years we will.
Next week, we’ll discuss options and I can almost guarantee, you’re not going to like any of those.
The viewpoints expressed by the author do not necessarily represent those of KTVA 11 News.
Reality Check w/ John Tracy airs Thursday at 6 p.m. & 10 p.m. on KTVA.
The post Reality Check w/ John Tracy: Fixing Alaska’s budget gap appeared first on KTVA 11.