Dear Friends and Neighbors,

Last week, Governor Walker released his long-awaited plan to fix the state’s budget deficit. It is a good start. The Governor also released a preliminary budget proposal for next year. Named the “New Sustainable Alaska Plan” or “NSAP,” the goal is to close Alaska’s multibillion dollar deficit by 2018. What do you think of the Governor’s plan?

As a legislator, the plan and some responses to the plan raise important questions:

• In light of our budget deficit, is this proposal a responsible action plan for Alaska?
• Should the legislature look at both revenue and budget cuts, or should the legislature only consider budget cuts in the 2016 legislative session?
• Should we withdraw over $3 billion from our state savings and “kick the can down the road” to 2017? Or should we take action in the upcoming session?

As the January session approaches, I always want to hear from you on the Governor’s long-range fiscal plan and any other subject of concern.

Governor’s Fiscal Plan:

The Governor’s plan includes a shift in the permanent fund as part of the Permanent Fund Protection Act (PFPA), which the Legislature first learned about during the most recent special session. The PFPA would turn the Permanent Fund into an endowment-like fund that uses oil income to generate annual revenue from investments for the state. 

A graphic illustrating Governor Walker’s proposed fiscal plan.

In addition to the Permanent Fund Protection Act, the Governor’s plan includes several new taxes: income, oil and gas, oil and gas tax credit reforms, mining, fishing, alcohol, tobacco, tourism, and motor fuel.

The budget proposal for fiscal year 2017 includes $100 million in new spending cuts that range from $2 million in pre-kindergarten grants to $750,000 for public radio.

Alaska faces another $3.5 billion deficit, if not more, this year. Oil prices remain low – this morning Brent crude oil was $36/barrel. The Governor’s plan generates almost $1 billion in new revenue and leverages another $3.2 billion in revenues from Permanent Fund investments. As a state, continuing to live off of our savings, such as the Constitutional Budget Reserve Fund, is not possible in the long term because those saving will be gone in two years.

The Governor’s plan is not perfect, but it is a starting point. Charles Wohlforth recently wrote about the challenge that we face. And I attended a meeting hosted by Commonwealth North of business leaders and lawmakers. The consensus from the business community is the state cannot look only at cuts this legislative session. When a business is facing fiscal challenges, it does more than cut costs, it also looks at ways to increase revenue. When families face financial challenges, they look for work opportunities to increase income and look to save money. Our state is facing great fiscal challenges this legislative session; we need a responsible action plan for Alaska.

Harvesting Alaskan Christmas Trees:

It’s that time of the year! The Department of Natural Resources has provided multi-agency maps and information for Christmas tree harvest areas in Southcentral and Interior Alaska, as well as tips for cutting and caring for a Christmas tree. The maps are available online at dnr.alaska.gov/commis/pic/christmastree.htm, or by calling the DNR Public Information Centers at 269-8400 in Anchorage or 451-2705 in Fairbanks.

A photo of the US Capitol Christmas tree from our own Chugach State Forest!

The Alaska Division of Forestry allows Alaska residents to cut Christmas trees on unrestricted state lands. The maximum tree height is 15 feet and the limit is one tree per household.

Here are some other considerations regarding cutting of Christmas trees on state lands:

• Properly identify land ownership where you intend to cut your tree. If you have any questions, consult your local area forestry office.
• The Division of Forestry does not maintain forest roads. Anyone traveling on forest roads should have tire chains, a shovel, tow strap and warm clothing in the event they become stuck.
• Christmas trees cut on state land are for personal use only and may not be sold.
• Cut trees as low to the ground as possible.
• Cutting trees in tree plantations is prohibited.
• Please do not litter and be courteous to other tree cutters and residents who live in the area.

As always, please let us know if you have suggestions or concerns.

Sincerely,

    Rep. Matt Claman

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