Speaker of the House Bryce Edgmon, D-Dillingham, says effort will continue in the legislative session now underway to identify efficiencies that allow cuts to state outlays, but that the quality of programs and services could be compromised by further budget reductions in some areas.
“We are at a tipping point, where in most cases further cuts will simply set up government to fail, removing the value from the dollars we do spend,” Edgmon said in his legislative update newsletter of Jan. 19.
Edgmon noted that Alaska faces an unsustainable structural budget deficit this year’s being some $3.5 billion. “Savings in the Constitutional Budget Reserve, now less than $2.2 billion, are not sufficient to fill the gap and are also necessary to facilitate cash flow for government agencies,” he said.
Without the cash flow the budget reserve provides, every year the state would be forced to take out something like a series of expensive payday loans, he said.
The Majority Coalition that he leads as speaker of the house showed last year its willingness to make tough decisions needed to deal with the fiscal crisis and turn to a more prosperous future, he said. They offered the Senate a fiscal plan that fully balanced the budget while still assuring a Permanent Fund dividend for residents, strong education funding for Alaska’s children and sufficient resources to insure value in what state government does for its citizens, he said.
Meanwhile, the Senate flatly rejected the comprehensive plan the House sent them “and offered nothing in its place except measures that left chronic structural deficits, fiscal instability, and risk to the PFD going forward,” he said.
It is time, said Edgmon, for the Senate to finally offer a compromise.
