FAIRBANKS — Gov. Mike Dunleavy revealed massive cuts to K-12 education, the University of Alaska, and health and social services in his amended operating budget released during a news conference Wednesday morning in Juneau.
After cuts to almost every area of state spending except public safety, Dunleavy's proposed operating budget is $1.3 billion less than the proposed budget for fiscal 2020 that former Gov. Bill Walker left for him in December.
Dunleavy has repeatedly said he would present a budget that would eliminate the projected $1.6 billion deficit without drawing on savings. The other $300 million is to be made up in additional revenue by removing the ability of local governments to tax oil and gas properties, meaning the oil and gas companies would pay those taxes to the state instead.
"It’s going to touch all Alaskans no matter where they live and what they do,” Dunleavy said.
Based on those budget cuts, Dunleavy noted Wednesday morning that approximately 600 full-time state positions will be cut.
Here is an overview of some of the major areas of reduction:
University of Alaska and K-12
The University of Alaska is facing a cut of more than $134 million from fiscal 2019's appropriation of approximately $327 million. The governor's amended budget funds the university at just over $193 million. A cut of that scale would mean doubling tuition across the board or eliminating approximately 1,300 full-time positions, according to UA President Jim Johnsen.
“Our largest cost drivers are education and health and social services," Dunleavy told reporters at Wednesday's announcement. "Moneys they receive this year are going to be much less than they saw last year.”
Even after seeking to pull $20 million in supplemental funding for school districts across the state in the current fiscal year, Dunleavy has proposed nearly $325 million of further cuts to education and early childhood development.
The governor's budget proposal eliminates all funding for early childhood grant programs such as Head Start and eliminates all funding from the Alaska State Council on the Arts.
His budget also cut $280 million from the Department of Education's per-student funding, referred to as Base Student Allocation.
Health and social services
The budget for the Department of Health and Social Services is being cut by nearly $365 million.
Dunleavy told reporters he was not planning to fully repeal the Medicaid expansion approved by Walker in 2015, but he noted that further discussions were in the works. Dunleavy's budget cuts $271 million from state Medicaid services.
The Alaska Psychiatric Institute is looking at a nearly 25 percent cut in funding. That comes just days after the Dunleavy administration announced its intention to privatize the institute through a for-profit company called Wellpath. The company, which has been cited hundreds of times for inmate neglect and incidental death, is set to get approximately $1 million a month from the state.
Behavioral health evaluation and treatment is set to be cut by more than 26 percent.
Tribal assistance programs will be eliminated. So will the Senior Benefits Program, which issues financial assistance to low-income Alaskans over the age of 65.
Department of Corrections
The Department of Corrections budget faces a decrease of just over $32,000.
Dunleavy's budget included, however, an increase of more than $17 million in out-of-state corrections contracts. This increase follows a memo signed my Senate Democrats requesting that the Dunleavy administration clarify budget manager Donna Arduin's ties to private prison businesses.
Arduin noted in Wednesday's news conference that the state plans to move 500 prisoners out of state to private prisons. Another item in the department's budget includes an increase of $130,000 in inmate transportation.
Department of Public Safety
Dunleavy has proposed to cut the Department of Public Safety budget by just over $26 million from what Walker had proposed in his fiscal 2020 budget.
The governor has cut the $21 million budget increase Walker proposed for the Alaska State Troopers, essentially keeping troopers at current funding levels.
Dunleavy has also flat funded the Council on Domestic Violence and Sexual Assault. Walker had proposed a nearly $14,000 increase to the council. Alaska has the highest rates of sexual assault in the country.
Department of Transportation
Dunleavy proposal cuts the Marine Highway System funding by nearly 75 percent, with talk of possible privatization.
The budget also cuts funding of nearly 247 rural airports the state owns and operates.
All other materials associated with the governor's budget can be found at www.omb.alaska.gov/html/budget-report/fy2020-budget/amended.html.
Contact staff writer Erin McGroarty at 459-7544. Follow her on Twitter: @FDNMpolitics.