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Alaska's State Government Faces Big Budget Cuts


Alaska's government is facing budget cuts that puts spending per person at the lowest level in 45 years, cuts that most lawmakers have fought. The state's new Republican governor trimmed more than 40% from funding for the University of Alaska, as well as Medicaid, payments to seniors and help for the homeless. The governor is, instead, prioritizing a $3,000 check this year for every person in the state, as Andrew Kitchenman from Alaska Public Media and KTOO reports.

ANDREW KITCHENMAN, BYLINE: To understand this story, we've got to go back to 2014 when oil prices plummeted. That was bad news in Alaska where, without an income or sales tax, the state relies heavily on oil taxes and royalties. Lawmakers started cutting from the budget to save money. And then there was the Alaska Permanent Fund. The state's been setting aside some of its oil money every year into the savings account. Historically, the state has used the fund to give a check to every Alaska man, woman and child known as the Permanent Fund Dividend, or PFD. But when times got tough, the former independent governor cut that check from $2,000 per person to about $1,000. And that trend has continued until...


MIKE DUNLEAVY: My goal is to pay a full PFD and to go back and make sure that Alaskans get the PFD that was also cut.

KITCHENMAN: That's Mike Dunleavy. He was in the state Senate until last year when he ran for governor, and he was elected on a pledge to pay a full PFD. This year, Dunleavy vetoed nearly $400 million in state funding from the budget the legislature passed.


UNIDENTIFIED PROTESTERS: (Chanting) Save our state.

KITCHENMAN: Then this week, protesters gathered in Wasilla, the governor's hometown, where he'd called a special session with one item on the agenda - paying out the full PFD. The only lawmakers who showed up at a middle school in Wasilla were 21 Republicans aligned with the governor. More than 500 miles away, most of the legislature, including 13 Republicans, showed up in Juneau, the state capital. They wanted to override the governor's budget vetoes. Republican State Senator Natasha von Imhof says those cuts will put the state into a recession.


NATASHA VON IMHOF: You won't have a job if you work at the university or in construction. You might not have access to dental coverage or Head Start preschool for your kids or assistance to pay for heating fuel or any tuition money or even an actual university to attend for that matter.

KITCHENMAN: But they didn't have enough votes in Juneau to override the vetoes. The budget cuts have many Alaskans fearful about the state's future. Tina Tomsen is a gynecologist who attended a protest in Wasilla.

TINA TOMSEN: I think it will decimate the state's human infrastructure and be a disaster - increasing property taxes, increasing crime rates and decreasing our appeal for the young and vibrant community that we need to build.

KITCHENMAN: She doesn't want the spending cuts or a big cut to the PFD. She says the state can balance its budget if the major oil companies pay more taxes. With lawmakers so far apart physically and politically, it's not clear what will bring the groups in Wasilla and Juneau together. Republican Senator Mia Costello spoke in Wasilla.


MIA COSTELLO: We're continuing support of a future in Alaska that is based on the constitution and a viable, healthy community.

KITCHENMAN: Dunleavy-aligned legislators say they'll scale back some of the cuts once the legislature passes the full PFD. But this year's are just the first round. Next year, public education may be up for cuts. For NPR News, I'm Andrew Kitchenman in Juneau. Transcript provided by NPR, Copyright NPR.

Andrew Kitchenman
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