{"id":57799,"date":"2020-01-22T13:25:00","date_gmt":"2020-01-22T22:25:00","guid":{"rendered":"https:\/\/www.juneauempire.com\/news\/lawmakers-get-gloomy-budget-forcast\/"},"modified":"2020-01-22T18:28:44","modified_gmt":"2020-01-23T03:28:44","slug":"lawmakers-get-gloomy-budget-forcast","status":"publish","type":"post","link":"https:\/\/www.juneauempire.com\/news\/lawmakers-get-gloomy-budget-forcast\/","title":{"rendered":"Lawmakers get gloomy budget forcast"},"content":{"rendered":"
The House Finance Committee got a detailed walk-through of the governor’s proposed budget Wednesday morning, and the message was quite clear: the state cannot continue to spend like it is.<\/p>\n
“The governor has built in a $1.5 billion deficit,” said Rob Carpenter, analyst for the Legislative Finance Office.<\/p>\n
When Gov. Mike Dunleavy released his budget in December, he said he intended to pay a full statutory Permanent Fund Dividend of $3,170. That would require drawing the state’s Constitutional Budget Reserve savings account down to $540 million<\/a>.<\/p>\n But if the governor’s budget were to go through as planned, Carpenter said, this would be the last year the state would be able to draw from the CBR.<\/p>\n “The CBR is gone by (Fiscal Year 2022), Carpenter said. “In this scenario, the (Earnings Reserve Account) would be gone by FY30.<\/p>\n Carpenter said these were just projections and it was highly unlikely for such a scenario to actually occur, but his office was tasked with creating projections with the information available.<\/p>\n “If we do this and we end up with $500 million in the CBR, this will be the last time it will be sufficient to solve our budget issues,” Rep. Adam Wool, D-Fairbanks, asked. Carpenter told him that was a correct statement.<\/p>\n The largest part of the state’s spending was on the Permanent Fund Dividend, Carpenter told the committee, which draws roughly $2 billion from the CBR.<\/p>\n Carpenter provided the committee with a slide show containing graphs<\/a> with 10-year projections of state finances based on the governor’s budget. With lower dividends the state would be able to maintain the the CBR and not have to draw from reserve accounts.<\/p>\n