Complicated Alaska budget crisis explained in simple terms

With the state facing a $3.5 billion budget deficit, Alaskans have been debating a complicated series of plans on how to fix the problem. How much state spending needs to be cut? Should we increase taxes or initiate new ones? How does the Alaska Permanent Fund fit into the situation? It's by far the biggest issue the governor and state legislators are dealing with in Juneau this year.

In recent months, Gunnar Knapp, professor of economics at the University of Alaska Anchorage and director of the Institute of Social and Economic Research, has been on a mission to educate Alaskans about the problem and potential solutions. He's given versions of a presentation about the budget crisis and Alaska's looming fiscal cliff to anyone who will listen, and has spoken to groups large and small.

We asked Knapp to make a shorter, somewhat simplified version of his presentation for a video audience.

[alyssashanks]

Thanks for this great explanatory video, Dr. Knapp.

[dennispettitt]

Being fairly new to the state, I have to say, this video appears to be an unbiased crash course! Unfortunately, it is 3 years old at this time... any chance of an updated version?

[moplum]

1. the constitution does not require we spend the equivalence of four lower 48 state budgets for education. Reduce Education costs. A simple audit would likely find an enormous amount of cost cuts available. 2. Health and social services could have been much lower but Sean Parnell refused medicade, medicare federal funding. Accept Federal Funding 3. Stop oil subsidies, SB21. 4. Generate new state income, lottery, marajuana tax, state sales tax. There now most of the budget is fixed. Ride the storm a short while OPEC will cut production to raise oil prices. Alaska will no longer have a dividend if the goverment gets hold of it to finance huge projects until its all gone.

[glenbiegel]

I believe cuts along with keeping all the earnings of the Permanent Fund in the savings accounts (no new deposits into the corpus) are the way to go right now. We should also have the cut to the Dividend checks on the table, and the new taxes also. Having these laid out for us to debate (not implement them), will help to focus our debate and ensure Alaskan's understand that they WILL have to pay for the government they are (or are not) getting.

[ardrrr]

Good job for Professor Knapp... now if he would break down for us those two huge items, Education/Development and Health/Social Services, you might have a real discussion on the spending. I wonder how all our corporations are contributing to those two budget areas... how much budget is returned to them. I don't know, should we have a corporation for 'everyone else'? From Prof. Knapp's charts, without cuts, raising all those tax revenues + taking practically all the dividends and savings might equal the deficit, just this year.

[terrysteward]

Cut environmental regulations and then bring in new logging, pulp mills, mining and other natural resource industries which would bring more money into the State.

[moplum]

Dr Steve Brule continued: the chart for 50 state tax burden is on line, anybody can look it up. I Have tried to post these charts and graphs but have not been able too. Only the excel code posts. The reason I brought up property taxes and schools is they are an extreme drain on BOTH budgets for a very small student population, WHY? To put in perspective four to five time the entire state budget of Colorado who has millions of students. The government is my servant and I want to know where all that money is going. I don't think anybody can say where it is all going. That is why I say there must be an audit. Example is there a need for three or four principals per school? Fully stocked libraries in each school when there is a local public lidrary? Why do the schools have furnishings that look like from the trump hotel? Thousands of dollars in original art works? Yes the constitution says art work but not 20 $15, 000 original paintings in the multipurpose room of each school.

[moplum]

Very good briefing on the budget. Two concerns I have as an Alaskan. 1. Fact, Alaska has the highest state government operating cost of all fifty states. Four times the the cost of approximately 2/3 of those states. We only have between 600, 000 and 700, 000 residents in this state. 2. You did not discuss how the Dividend was created. This is important, as it required all Alaskans to give up our oil mineral rights to be managed by the state. So all could benifit, not just a few leased mineral rights owners. Mineral rights are real property, I know I own mineral rights in Colorado, and treasure them as an important ownership for my family. The Dividend is owned now by all Alaskans not just mineral rights owners because Alaskans voted that into law. By the state taking the PFD instead of just managing it, the state has then taken the landowners mineral rights and oil dividend both. That is theft, it is a round about sleazy way to do it but it is theft. Cut government spending, period.

[invisibleforces]

"restructuring " is the same as "reorganization" check the legal def for
these words. Apparently the State of Alaska: a federal legislature
creature of statute(municipality) is
BANKRUPT and talk of "restructuring" the PFD is deceptive language to
non lawyers for saying they want to use the PFD to pay for the
bankruptcy of the State. This would be immoral. The people of Alaska
who own the PFD did not bankrupt the state, state employees bankrupted
the state. but they desire to use the people's fund to pay for their
horrible mistakes. These same immoral, irresponsible state employees
want to keep educating the children of Alaska under their guidance.
They want to make sure your children never learn basic commercial law
covering bonds and municipalities to keep them in darkness. and plunder
them into the future. SOA YOU"RE FIRED! GET EM OUTTA HERE!

[damienbell]

We need to stop giving raises to school districts, there in the 50% far as the kids test, it’s 2019 now and Dunleavy finally made the hard choices

[moplum]

Dr Steve Brule: eMail any of the Alaska state legislators, they all have a copy of this data. I got mine from my legislative representative Wes Keller. Im sure Wes Keller would send it to you. It is a bar graph the legislators are using this current budget meeting. It shows Alaska has the most expensive state government operating costs of all 50 states. We are also the highest taxed state in the Union. We are taxed at over 20% in property taxes: 2013 chart. Our property taxes out tax all other states income tax, sales tax, and property taxes combined. If you own or rent a place to live in Alaska you are the heaviest taxed of all 50 states. Makes me sick when people say it is time for us Alaskans to start paying our share of taxes! So schools hit the state budget the hardest, and Schools eat up 95% of property tax budget. AUDIT THE SCHOOLS. Where are all those billions going? We should only have approximately 350, 000 kids. Some of those are in private schools. See next

[U.S.SlaveOfficial]

he says drop from 25 years ago so how is price at the pump 4 times the price now than it was 25 years ago? hell this vids a few years old so make that 5+times the price then it was 28 years ago

[maloneth]

The obvious answer is that you have to do some of each.

[damienbell]

Wait why aren’t you able to pay the dividend, your saying you don’t have to, where in the pfd constitution does it say this, or you made it up, this is Bullshit till you said that