Operating budget passes House with $759M deficit

By Rep. Louise Stutes, R-Kodiak

Dear Friends and Neighbors,

I hope this finds you well and in good spirits. I wanted to provide a short legislative update on recent work on the operating budget, meeting with the governor, AMHS update, Board of Fish appointments, fish related bills – two I am sponsoring, and the education bill introduced by the Governor.

2024 Operating Budget                                                                                                                          

The Fiscal Year 2024 Operating Budget passed the House with a budget deficit of $759 million, made up of the $584 million deficit and $175 million for the Base Student Allocation. Passing a balanced budget is challenged by Alaska’s limited sources of revenue: from oil to lower PFD investment earnings. The majority in the House did propose reducing the PFD to $2,600, yet there were few suggestions for a sustainable budget that reliably funds Alaska’s needs.

The proposal to spend $5 million to take over the Clean Water Act 404 permitting program currently performed by the EPA adds additional fiscal burden to the Operating Budget.


I’ve listened to members of the House Majority say “as a conservative,” and yet here we are with a budget with a massive deficit, while they think nothing of drawing our savings down to a dangerous amount to pay for it. With an unstainable budget it spotlights Alaska’s essential services of the university, K-12 education, deferred maintenance of schools, health care, public safety, and infrastructure projects. The Majority proposed to fill the deficit by tapping into Constitutional Budget Reserve savings account with a dwindling balance of $2 billion. This did not pass the House as it takes a three-quarter member vote.

The budget is now being taken up by the Senate and their version looks quite different. We will see where it all ends up when the two bodies meet to iron out the differences.

Meeting with Governor                                                                                                                                          

I am encouraged by the governor’s request for us to bring him a fiscal and tax plan. The governor unveiled a number of tax bill and PFD options, including splitting the POMV draw with 75% going to state services and 25% to the dividend, or a 50/50 split requiring deficit spending. He urged the Senate and House to come up with a preferred plan.

Alaska Marine Highway Operations Board                                                                                                   

I had the opportunity to attend the most recent Alaska Marine Highway Operations Board (AMHOB) meeting (on 4/24) and came away very encouraged. There is a new director for AMHS, Craig Tornga, who comes back to Alaska with years of marine transportation experience and is excited to be actively involved in rebuilding a sustainable marine highway system. It appears he has already been successful in creating a collaborative relationship with AMHOB and AMHS, which is critical in moving our system forward. I could go on and on here, as most of you know, but I will stop for now as he is new onboard and, as we all know, actions will speak louder than words, but we are off to a darn good start!

Board of Fish Hearings                                                                                                                                              

House Fisheries and House Resources Committees met to review the qualifications ofGerad Godfrey, of Eagle River, Mike Wood of Talkeetna, Greg Svendsen of Anchorage, as members of the State Board of Fisheries. I’m pleased with the nominees and my only concern is there is only one coastal representative and no-one from SE, which is a huge industry. When nominees are from Anchorage or the wider Anchorage area only, it seems centralized representation.

Area M                                                                                                                                                                   

I don’t support the Area M fisheries bill, SB 128, to temporarily close the commercial salmon fishery in the Alaska Peninsula, Aleutian Island and Atka-Amlia Island Areas. I believe it is not our role as legislators to make decisions on behalf of the Board of Fish, or be involved in allocative fishery issues. I feel it would destabilize boards and generate a culture of nominees not coming forward, fearing legislative interference.

HB 19

House Bill 19, the clean-up bill for an overlooked portion of Senate Bill 92, the so-called “derelict vessel bill” which passed in 2019, passed out of House Fisheries and now makes its way to House Finance.  The bill will streamline registration for active commercial fishing vessel owners. Those with valid certificate of documentation with the U.S. Coast Guard and a current Commercial Fisheries Entry Commission (CFEC) license would be exempt registering every three years with the Department of Motor Vehicles. Alaska Department of Fish and Game requires vessels to display their ADFG numbers on the outside of their boat for easy identification and reference. The bill would establish an annual $8 registration fee with the Alaska Commercial Fisheries Entry Commission (CFEC) and those who have paid the $24 DMV would be grandfathered out for the next two years.

HB 20                                                                                                                                                                         

House Bill 20 was heard in House Resources on Monday. The bill will help the deliberation process in the Boards of Fish and Game by allowing those with expertise in a given subject offer their comments before the board, but not vote.

Base Student Allocation                                                                                                                                          

The Senate is considering a one-time funding allocation of a $680 in the current version of the budget. This is outside the base student allocation. This was the number initially proposed in the House version of the budget.

Education Bill CSHB 105 at the request of the Governor

Passed out of the Education Committee on April 26. It is “an Act relating to parental rights in a child’s education; relating to access to school records; relating to sex education, human reproduction education, and human sexuality education; relating to school disciplinary and safety programs; and providing for an effective date.” The Senate has made it clear they will not be hearing this bill in the Education committee.

Public Testimony

Thank you to so many of you that spoke to committees in bill hearings of importance to you, your family, and communities. It is heartening to hear from our districts Legislative Information Offices in Kodiak, Cordova, and Seward of the tide of folks using their services to testify and let elected officials know about your needs and wishes.

Remember, I work for you!

Representative Louise Stutes serves Kodiak, Cordova, and Seward. She can be reached at 907-465-2487.