Southeast Spotlight:
budgets, health care, and capitol creep

Dear Neighbors,

As we work our way through session, we have been fortunate to be able to visit with many constituents and advocacy groups.  Thank you to those of you who have contacted us and come by our office.  We appreciate hearing from you.  Here’s where we find ourselves on the 35th legislative day.

Rep. Kito and the Juneau Delegation meet with Youth Advocacy Group.

Budget, What Budget?
This year, we find ourselves in a very difficult situation with low oil prices that have resulted in a budget deficit of $3.5 billion in General Fund dollars.  For the last several weeks, I have been attending budget subcommittees for the departments of Transportation, Education and Commerce.  The committees have been asking many questions about reducing spending.  This is especially troubling when the reductions concern our Marine Highway System and Mt. Edgecumbe High School (MEHS).  

When the question was raised about the necessity of the state continuing to operate MEHS,  I felt it was important to remind committee members of the importance of the school, and its role in creating opportunities for students around the state.  Thank you to everyone who called or emailed with words of support.

In the Transportation subcommittee, we heard concerns about the high cost of the Alaska Marine Highway System (AMHS).  This is an important lifeline for all of Southeast Alaska, and essential transportation for those who rely on it.  The current fiscal climate is putting pressure on AMHS funding.  Governor Walker did restore funding to make sure already sold tickets could be honored for the upcoming summer season, which also provides for full service to continue through this summer.  The discussion on AMHS will continue, and it will be important to work with southeast communities and AMHS to make sure the system is operating as efficiently as possible.  Our roads, airports, and ferry system provide essential transportation services to our state, and I will continue to work to support those services.  

40,000 more Alaskans with Health Care
Governor Walker recently announced more detailed plans for the expansion of Medicaid. This decision is necessary for the future of Alaska health care.  Medicaid expansion will result in a net savings of over $6 million in General Fund dollars in the first year of expansion.  Even when we have to pay 10% of the costs, the state will be spending more than $3 million less in General Funds to keep the program functioning.

Health care costs in our state are higher than elsewhere in the US: in 2010, we spent $7.5 billion on 710,000 Alaskans, or roughly $10,600 per Alaskan in health care expenses.  Health care costs are higher now.  That is too high, and we will need to work on lowering health care costs for all Alaskans.

The high cost of health care in Alaska is due to a number of factors – including a higher cost of living, competition for a limited number of health care professionals, isolated communities, and smaller markets.  While these factors are difficult to control, one factor that we can impact is the size of the market: if we can increase the size of the insured pool, we should be able to start bringing costs of our health care down. The more people covered in a health care system, the more widely distributed (and lower!) the costs.  This can be started through expanding the Medicaid program and providing 40,000 more Alaskans with health care.

Rep. Kito tries out the captain’s chair on the R/V Sikuliaq during a tour of the vessel while it was in Juneau.

Capital Creep
After the recent announcement by the Alaska Public Office Commission (APOC) Board to close the APOC office in Juneau, the Juneau delegation sent a letter to Governor Walker requesting immediate reconsideration of that decision. 

The Juneau office is the focal point for lobbyist reporting and regulation.  Legislative lobbying occurs primarily in the capital city, and it makes sense that the staff with oversight responsibilities for lobbying should be physically located in Juneau.  It also appears as though the APOC budget proposal will result in an increase in administration and a reduction of the agencies ability to provide public services.  APOC also regulates campaign activities, and much of the reporting activity occurs online.  Because of the magnified detrimental effect of losing jobs in smaller communities such as Juneau, I think it would be more sensible to relocate the entire APOC office to Juneau.

Rep. Kito addresses the Alaska Professional Design Council.

The decision to move the Juneau APOC offices is another example of the phenomenon of Capital Creep – the movement of jobs away from the capital in Juneau.  Capital Creep needs to monitored and jobs leaving the capital city for other parts of the state need to be carefully scrutinized.  I urge you to share your thoughts with both my office (465-4766) and the Governor’s (465-3500).

Announcements & Reminders
1. Recruitment for Alaska Permanent Fund Corporation (APFC) 2015 summer internships is underway.  All program information can be found on the APFC website here: http://www.apfc.org/home/Content/aboutAPFC/internIndex.cfm.

2. Apply online for your 2015 Permanent Fund Dividend – Deadline is March 31. If you haven’t yet done so, please don’t forget to apply for your 2015 Permanent Fund Dividend. You can apply online at http://pfd.alaska.gov or call the Permanent Fund Dividend office at 465-2326 to find your nearest location to fill out the application by hand.

With Regards,

Sam Kito III