The Senate unanimously approved a budget designed to restore college scholarships, keep intact a medical school interstate cooperative program and maintain a rural energy assistance.

Senate Bill 2002 also funds highway and road projects that generate matching federal funds that lawmakers say need approval by month’s end or risk losing access to that money.

“Alaska is a very large state and it is important that we maximize transportation dollars each year so that we can connect our communities to jobs, to schools, to each other and to our natural resources,” said Senate Finance Co-Chair Natasha von Imof, R-Anchorage, shortly before the Senate produced a 19-0 vote.

It’s the state’s capital budget and it needed revisiting in this second special session because efforts in the House to pass a fully funded budget failed in June.

It will again be up to the House to cast a final vote in coming days. The House adjourned Saturday until 1 p.m Sunday.

Shortly after the Senate passed SB2002 early Saturday afternoon, the bill was transmitted to the House and referred to the House Finance Committee.

The bill also features an effort to replenish several dozen funds depleted and shifted to a state savings account per the state constitution.

The familiar term is known as a “sweep,” and unless it’s answered with a “reverse sweep” from a super majority vote, the money remains in the Constitutional Budget Reserve.

Last month the Republican House minority held back the necessary votes to restore the swept funding after a vote for a $3,000 Permanent Fund dividend failed.

Unless each chamber can produce the three-quarter vote, nearly $2 billion worth of swept funds will no longer be accessible be a simple majority.

In a separate vote, the Senate unanimously supported the reverse sweep, bringing the state one-step closer to resuming its college scholarship program for 5,000 students among other programs.

House Minority Leader Lance Pruitt, R-Anchorage, didn’t commit to another vote against the reverse sweep but said he thought the bill wouldn’t feature other provisions like the reverse sweep.

“No one wants to jeopardize the federal fund match,” he said. “What they’ve done again is they’ve connected that match to other things, ultimately to a smaller PFD.”

Von Imhof identified some other funding she deemed crucial:

  • $250 million for supplemental costs like wildfire suppression currently underway statewide;
  • $12 million for village safe water and infrastructure;
  • $10 million for homeless grants.

Since the last capital budget vote taken on June 13, the dynamics of the state’s finances have changed dramatically.

On June 28, Gov. Mike Dunleavy announced $444 million in budget vetoes, including $130 million for the University of Alaska.

On July 12, Dunleavy’s office released a list of accounts he swept into the budget reserve, including several historically not swept, such as the higher education and Power Cost Equalization funds.

On Wednesday, Moody’s Investor’s Service issued a three-step credit rating downgrade to the University of Alaska, citing, in part, the “unprecedented” cuts.

Late Friday night, after the Senate Finance Committee passed the bill, Von Imhof said her office has received nearly 5,000 emails expressing concern over vetoes and the potential lost scholarships.

“I received a text message from a friend that said ‘I got this letter that says my daughter no longer has her scholarship money. She came back to Alaska to go to college here. And she’s loving it and doing well, and now what are we supposed to do?’ It’s July and they're getting this letter and she’s going to start school in a month.”

Correction: Gov. Dunleavy announced his vetoes on June 28, not June 23. This story has been updated.

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