Protecting Your Rights: Serving Sand Lake, Spenard and Turnagain

December 16, 2021

Dear Friends and Neighbors,

Yesterday, Governor Dunleavy released his proposal for the operating, capital, and mental health budgets for Fiscal Year 2023, which begins on July 1, 2022. The proposed budget is influenced by higher estimates for oil revenue, significant aid from the federal government, and a dividend based on the governor's proposed POMV withdrawal from the Earnings Reserve that would be split 50-50 between funding dividends and funding essential state services.

Governor Dunleavy Releases FY2023 Budget

The governor has proposed a budget for FY23 that largely flat funds essential services and adds two dividend payments totaling approximately $3,775 per person. The governor's budget proposal includes a supplemental 2021 dividend of $1,215 (costing $795.6 million) and a regular 2022 dividend of $2,560 (costing $1.7 billion) for a total of $3,775 per person. Paying $3,775 in dividends will cost a total of roughly $2.5 billion. The governor also proposed a capital bond for voters to approve that includes borrowing up to $310 million to upgrade the state’s roads, bridges, airports, and other infrastructure.

The FY23 operating, mental health and capital budget totals $4.6 billion in Unrestricted General Funds (UGF), $912 million in Designated General Funds (DGF), $792 million in Other State Funds, and $4.6 billion in federal funding. The proposed FY23 budget remains largely unchanged from the current fiscal year. The governor's proposed operating budget for FY23 (not including the dividends) is $4.9 million more in Undesignated General Funds (UGF) than FY22.

The governor did include some reductions in his FY23 proposed budget, including reductions to the Department of Transportation and Public Facilities, State Retirement payments, the Department of Military and Veterans Affairs, and minor reductions to other state agencies. Additionally, the governor once again proposed splitting the Alaska Department of Health and Social Services into a state Health Department and a state Department of Family and Community Services.

The following are some of the spending increases in the governor's FY23 proposed budget:

Increases University of Alaska budget by $4 million to stabilize state general fund operating support and $22.8 million in one-time American Recovery Plan Act (ARPA) funding for specific areas of investment
$24 million for the Department of Public Safety, including adding Troopers and VPSOs
Fully funds school bond debt reimbursement (funded at $79 million)
Fully funds K-12 education

It is important to remember that an incremental rise in the price of oil, changes in the stock market, and one-time funding from the federal government do not fundamentally change Alaska's financial challenges and leave us with upwards of $700 million in deficit spending. We need a responsible action plan that strengthens our economy, supports essential services, improves public safety, and moves Alaska forward.

Public input will be critical. Please email Rep.Matt.Claman@akleg.gov or call our office, (907) 269-0130, with any questions or concerns. You can also contact Governor Dunleavy. You may reach his office via email at this web page or via phone: 465-3500.

Department of Revenue Releases Fall 2021 Revenue Sources Book

The Fall 2021 Revenue Sources Book includes the Department’s fall forecast of oil price, oil production, and state revenue, and incorporates the most recent information about revenue collections, oil markets, investment markets, and federal funding.

Unrestricted General Fund (UGF) revenue, before accounting for the transfer from the Permanent Fund Earnings Reserve, is forecast to be $2.7 billion in fiscal year (FY) 2022 and $2.6 billion in FY 2023. The Permanent Fund is expected to transfer $3.1 billion to the General Fund in FY 2022 and $3.4 billion in FY 2023.

Compared to the Department’s Spring 2021 forecast that was released March 2021, the Alaska North Slope oil price forecast has increased to $75.72 per barrel for FY 2022 (an increase of $14.72 from the Spring 2021 forecast of $61.00 per barrel) and $71.00 per barrel for FY 2023 (an increase of $9.00 from the Spring 2021 forecast of $62.00 per barrel). The Alaska North Slope oil production forecast has also increased by 27,100 barrels per day (from 459,700 barrels per day to 486,700 barrels per day) for FY 2022 and 23,600 barrels per day for FY 2023. Driven by this improved outlook for oil price and production, the Unrestricted General Fund (UGF) revenue forecast has increased by $1.0 billion for FY 2022 and $0.8 billion for FY 2023.

For more information, visit: tax.alaska.gov/.

Infrastructure Investment and Jobs Act

The bipartisan infrastructure bill signed into law by President Biden is expected to have a tremendous impact on Alaska. The State of Alaska expects to receive:

$3.4 billion to improve highways and $225 million for bridge replacement and repairs over five years.
$1 billion over five years to improve the Alaska Marine Highway System, and $250 million for a low-emitting ferry pilot program.
$52 million over five years for an electric vehicle charging network in the state. Alaska will also have the opportunity to apply for the $2.5 billion in grant funding dedicated to EV charging in the bill.
$3.5 billion for the Indian Health Service to build sanitation facilities, bringing water and sewer to communities that have never had piped water before.
$1.5 billion to help provide rapid-permit broadband coverage across the state, including providing access to the at least 107,600 Alaskans who currently lack it. 203,000 (29%) of Alaskans will also be eligible for the Affordability Connectivity Benefit, which will help low-income families afford internet access.

Click here for an Alaska specific fact sheet.

Mark Your Calendar: Virtual Pre-Session Constituent Meeting

Please join me virtually to discuss the upcoming legislative session before we return to Juneau.

When: Wednesday, January 12 from 6:00 – 7:30 PM

Where: Zoom details will be shared in advance of the meeting.

Redistricting Update

The Alaska Redistricting Board submitted their final map, which includes the state's 40 House districts and subsequent Senate district pairings, in November. The final board vote was 4-1 in favor of the final map. This marked the start of a 30-day litigation window that closed last week. A total of five cases were brought forward against various components of the final map. These cases have been combined into a single case and the first hearing is on December 20, 2021, in Anchorage.

Since the 1970s, every census redistricting map in Alaska has been subject to litigation. The hope is that these cases are heard and tried swiftly, as the 2022 Election Cycle is nearing. The Alaska Redistricting Board has been meeting this week in order to organize for the legal proceedings. Below, read about each of the cases brought forward:

Calista Corporation and two Southwest Alaska Residents: argues that a House district incorrectly excludes Hooper Bay and Scammon Bay and incorrectly placed Tyonek into a southwest district.
Matanuska-Susitna Borough: argues that House districts in the Mat-Su exceed the ideal population level and cross municipal and natural boundaries. Exceeding population levels in districts means that some areas are under-represented.
Three Anchorage Residents: argues that the Senate districts that join East Anchorage neighborhoods with Eagle River are improperly drawn and illegal.
City of Valdez: argues that the House district that combines Valdez with Mat-Su is improperly drawn and does not follow logical economical pairings.
City of Skagway: argues that the House district that combines Skagway with Mendenhall Valley in Juneau is improperly drawn and asserts that Skagway has closer ties to downtown Juneau, which is in a separate House district.

Community Events

Mark your calendars for this upcoming event:

Zoo Lights 2021/2022

Light up your winter by visiting the Alaska Zoo on Zoo Lights evenings.

Zoo Lights Rates:

Ages 3 and up are $12/person for members and $17/person for non-members. Ages 2 and under are free.

First responders (healthcare, police, fire, military) and their immediate families will have free zoo entry (daytime and Zoo Lights) from now through January 1st, 2022. See the ConocoPhillips Alaska Share the Gratitude page for more information.

When: December 17 – January 2 from 5:00 – 8:00 PM, with last entry through the gate at 7:30 PM.

Where: The Alaska Zoo, 4731 O’Malley Rd.

For more information, visit the event website.