Governor signs bill funding nearly $1B in capital projects, PCE & college scholarships

Gov. Michael Dunleavy signed legislation Thursday afternoon that will capture nearly

for construction projects across Alaska, but he cut nearly $35 million from the bill through line-item vetoes.

At a small signing ceremony at the Associated General Contractors of Alaska, Dunleavy defended his vetoes as necessary, but acknowledged he had modified some of his positions on some items after conversations with constituents.

"As a result of those discussions, there have been modifications to this budget," he said.

, passed by the Legislature in July, also contains a

provision that ensures 54 state savings accounts won’t be drained.

The governor vetoed millions in funding for social service programs that were included in the capital budget.

Foremost among the

were a $10 million cut in services for addiction treatment, and a $3.6 million cut for a homeless assistance program. In a note contained alongside the vetoes, the governor wrote "The State's fiscal reality dictates a reduction in expenditures across all agencies."

The note was the same for a $5 million cut in the Alaska Housing Finance Corporation for energy programs and weatherization. Along with three other cuts, AHFC will likely lose $11.1 million.

Also vetoed were two $2.5 million packages for the University of Alaska, one for deferred maintenance, and another for an earthquake monitoring program. Dunleavy wrote that in regards to the former, "the University should advance their efforts for property disposal," and in regards to the latter, wrote that the university should consider submitting the project for consideration in FY21, "If this is a priority project".

Meanwhile, some of the threatened accounts that were approved included the Power Cost Equalization Fund that helps rural Alaskans with their power bills and the Higher Education Investment Fund that provides scholarships to roughly 12,000 Alaskans. The governor had previously announced that that funding was safe.

The legislation Dunleavy signed also funds the tough-on-crime bill passed by the Legislature that acts a replacement for Senate Bill 91. The $10 million vetoed today for addiction treatment was originally passed as a compromise for the new crime bill.

SB 2002, containing the capital budget for FY2020, has funding for projects across Alaska. The capital budget is typically less controversial than the operating budget but it repeatedly failed to pass through the Alaska House of Representatives over the size of the Permanent Fund dividend debates.

The legislation is separate to

that contains a roughly $1,600 PFD and restores a vast majority of the governor’s vetoes.

HB 2001 was transmitted to the governor on Wednesday morning. He has until Aug. 30 to decide whether to sign the bill into law, allow it to become law without his signature, to veto the entire bill or to veto certain items within it.

Dunleavy said in a press release today in reference to HB 2001 that "we will be working diligently and quickly to make decisions shortly in order to inform Alaskans about programs and services contained in the budget."

Matt Shuckerow, the governor’s press secretary, says Dunleavy is reviewing the bill but not to expect many “add backs” into the budget.