One promise I made to Alaskans was to present you with a permanent fiscal plan, one where we tackle our economic challenges and start bringing fiscal responsibility to Juneau. Combined with a series of legislative proposals and constitutional amendments, a major element of that commitment is addressing the state’s out-of-control spending.<\/p>\n
This year we’re presenting the Legislature with an annual budget that takes an open and straightforward approach. Rather than starting with the bloated budgets of the past and asking ourselves “where do we cut,” we did exactly what Alaskan families and small businesses are forced to do when faced with financial hardship. We started from the ground floor and built an annual budget where the amount we spend aligns with the amount we bring in; an approach that built a budget up, rather than reducing a budget down.<\/p>\n
[University of Alaska officials expect major budget cuts<\/a>]<\/ins><\/p>\n As we’ve all seen, for too long politicians haven’t been honest when it comes to the numbers and the seriousness of our fiscal woes. We’ve seen misleading figures, confusing budget tactics; we’ve relied on massive amounts of savings and Alaskan’s PFD’s to grow the size and reach of government — all while never seriously tackling the issue of spending. Today I’m here to say: those days are over. We can no longer spend what we don’t have and we can’t pretend otherwise.<\/p>\n The economic outlook Alaska faces today is dire. After burning through nearly every dollar in the state’s savings account – over $14 billion over the last four years – we are faced with another billion and a half dollar deficit, and less than a year in reserves. The gradual glide path approach, which lawmakers called for repeatedly since the rapid decline in oil prices, never came to fruition. Oversized budgets and outmatched spending continued with little recourse.<\/p>\n [No-bid contract for psychiatric institute raises questions<\/a>]<\/ins><\/p>\n In building this budget, my team and I worked across government to identify efficiencies, duplications and cost savings to restore the core principles of government responsibility. We built a balanced budget where expenditures do not exceed revenues; a budget that shows Alaskans the realities of where we are and the tough choices that have to be made. We looked for logical constraints on government and built a budget based on these core tenets:<\/p>\n • Expenditures cannot exceed existing revenue;<\/p>\n • The budget is built on core functions that impact a majority of Alaskans;<\/p>\n • Maintaining and protecting our reserves;<\/p>\n • The budget does not take additional funds from Alaskans through taxes or the PFD;<\/p>\n • Sustainable, predictable and affordable.<\/p>\n