State Budget Announced

State budget director Pat Pitney answers questions about the state budget while Gov. Bill Walker listens during a news conference on Thursday Feb. 5, 2015. Amid a mult-billion shortfall, the state announced it would eliminate some 300 positions.

JUNEAU — Gov. Bill Walker’s operating budget cuts about 300 positions from the state’s payroll, with many coming from the University of Alaska system.

With much anticipation and under the cloud of a $3.6 billion deficit, the independent governor unveiled his budget to the public on Thursday afternoon, outlining sizable cuts to both programs and employees throughout state government.

“It’s one that hurts,” Walker said of the budget during a news conference. “We have roughly a $10-million-a-day deficit, we had to do something. We had to make some step forward.”

All told, the cuts amounted to a $240 million reduction in agency unrestricted general fund spending in the operating budget since last year, state budget director Pat Pitney said. That combined with cuts to the state’s capital budget amounted to a roughly $550 million reduction in spending since last year, she said at the news conference.

The fiscal 2016 budget submitted by Walker on Thursday replaces the one former Gov. Sean Parnell left behind, which had been the basis for much of the budget talks so far. 

While the cuts don’t balance the budget, they’ll help extend the life of the state’s limited savings a bit, Pitney said. 

“So we’re up to 55 days,” she said.

Every state department but three — Commerce, Corrections, and Fish and Game — lost jobs in the budget. Some like the Department of Education and Early Development lost as little as two positions, while others like the departments of Environmental Conservation, Natural Resources, Public Safety, and Labor and Workforce Development lost between 20 and 25 positions each. The Legislature and the Alaska Court System did not lose positions.

The University of Alaska System was hit the hardest in the raw number of jobs cut in the budget. The budget submitted on Thursday included 85 full-time position cuts with many of them coming from Fairbanks-area programs. All of those positions are currently unfilled.

According to the component summary, the UAF campus will lose three positions, research would lose 23 positions, the UAF Community and Technical College would lose nine positions and the Cooperative Extension Service would lose four positions. 

The University of Alaska Anchorage campus would lose 28 permanent full-time positions.

The cuts were put forward by the Board of Regents, Pitney said, and could change by the time the final budget is approved by the Legislature.

In recent years, much of the reduction in positions has come from eliminating vacant positions, thereby avoiding layoffs of existing positions. That won’t completely be the case this year.

About half of the 300 cuts to the statewide payroll will come from unfilled positions, Pitney said. The former University of Alaska Fairbanks vice chancellor said there are no easy cuts in the budget and this year’s cuts will affect people and programs.

“You look at the number of people working hard you don’t find many people not working hard,” she said. “There’s no painless reduction, it means you either do something completely different or you do less because you have fewer people to do the job.”

To that end, much of the budget talk on Thursday revolved around finding efficiencies and economies of scale by combining services.

A number of services were cut or reduced, but the full impact of the budget is still being unveiled as analysts, lawmakers and reporters sift through the hundreds of pages of budget documents released Thursday.

Cuts discussed on Thursday included the wholesale elimination of funding for community jails as well as a significant cut for the state’s health inspector program.

With little time to sift through the dump of budget documents, lawmakers generally withheld judgment on the details of Walker’s budget. Many were waiting to see what the accountants in the Legislative Finance Division had to say. 

Sen. Pete Kelly, R-Fairbanks, and a co-chair of the Senate Finance Committee, said he’ll be looking closely at the budget during the next few days both with the Legislative Finance Division and his own staff, and said it’ll likely be Monday before he can pass judgement on the governor’s work.

“I’m having that analyzed,” he said. “My concern is how much we are spending, what’s the impact on reserves and what’s the impact on general funds.” 

The House Finance Committee, which is co-chaired by Fairbanks Rep. Steve Thompson, will work first on the operating budget, but Kelly said he plans to set his finance subcommittees to work reviewing the budget as early as next week. 

Contact staff writer Matt Buxton at 459-7544. Follow him on Twitter: @FDNMpolitics.