Bigger PFDs means bigger budget cuts across the board

Published: Dec. 21, 2018 at 6:37 PM AKST
Email This Link
Share on Pinterest
Share on LinkedIn

One of the promises Gov. Mike Dunleavy made over the course of his campaign was a bigger Permanent Fund Dividend check for Alaskans. Now, just weeks away from the next legislative session, Dunleavy and his team are racing to deliver a budget that delivers those bigger PFDs as promised. Dunleavy's first crack at a FY2020 budget proposal carved out $1.94 billion for PFDs — around $3,100 per eligible Alaskan.

Bruce Tangeman is the newly sworn in commissioner of the State Department of Revenue. This week, Tangeman sat down to discuss the possibilities being considered to find room in the budget.

"Gov. Dunleavy knew coming in that this was gonna be a big challenge," Tangeman. "His whole point all along has been that government is too big."

According to Tangeman, we can expect widespread cuts to state spending plans in fiscal year 2020.

"There will be significant reductions in the size of state government. Everything is on the table. All the departments will be giving at the office this year for sure," Tangeman said.

The commissioner also explained that the biggest cuts will come from departments that are the biggest drivers of state spending.

"Certainly Medicaid is the biggest one," said Tangeman.

It's still likely that the current budget will undergo major adjustments between now and the start of the new legislative session in January. The governor's final amendments are due by the 30th day of legislative session.

"You'll start to see the governors fingerprint's on the budget by mid-February," Tangeman said. "That being said, once we get into session, it might take us down some different paths depending on what the priorities are from the legislature. They clearly have a big say in what's going to to take place as well."