Dunleavy budget would exhaust all state savings except Permanent Fund by 2021

Gov. Mike Dunleavy introduced a reckless budget Wednesday afternoon in Juneau, one that would leave the state with no savings except the Permanent Fund by October 2021, then he ducked out of his own press conference.

After speaking for 11 minutes, Dunleavy said, “I’m going to run right now,” leaving it to the unelected commissioners and other staff members to answer questions. But they can’t speak for the governor or be held accountable for his irresponsible budget.

He is unwilling to talk about taxes, cutting the Permanent Fund Dividend or cutting state spending by hundreds of millions. But those are the ingredients for any fiscal plan and there is no time for delay.

Perhaps he thinks that he was so burned by the negative reaction to his February budget, that dumping the problem on the Legislature is an alternative that doesn’t require him to take a risk. Perhaps he thinks that proposing no taxes, no cut in dividends and no major spending cut in state government—other than the University of Alaska—he can remain aloof from the dirty work until the money runs out.

The Dunleavy budget would take $1.6 billion from the Constitutional Budget Reserve in the fiscal year that begins next July. The fund would have about $500 million left by July 2021, which would last until the fall of 2021. After that the state would either have to use Permanent Fund earnings or cut hundreds of millions from education, health care, etc.

Perhaps Dunleavy is hiding his real plan. Cliff Groh, who has studied state finances for many years, wrote on Facebook: “The Governor's real plan cannot and does not include the spending of savings only. A legislator told a group of people including me today that the Dunleavy administration is seeking to get legislators to introduce a bill to provide for a 4 percent sales tax and another bill to change oil and gas taxes (presumably to raise them on net).”

That would allow Dunleavy to say that it wasn’t his idea to enact a sales tax or change oil and gas taxes.

Perhaps Dunleavy doesn’t want to be governor at all. This budget increases the chances that the recall movement will gain strength. He is abrogating his responsibility.

As the 27-minute press conference was about to end, reporter James Brooks of the Anchorage Daily News asked a question that deserves a real answer: “What meeting did the governor have to go to? What meeting is more important than the budget?”

The real answer is that there was no more important meeting for the governor to attend Wednesday. Unless it was a funeral or the birth of a child, he should have stayed.

The governor's spokesman said, "He had another obligation. I'm sorry."

Alaskans need to know all about what is probably an imaginary obligation. Every news story about this budget rollout needs to include the details of the meeting that couldn’t have been delayed 15 minutes.

It was a sorry display from the state’s chief executive, after releasing a budget that puts the future of Alaska at risk.

What exactly is the Dunleavy plan for November 2021 when the state will start to need $1.5 billion or more in unsustainable annual withdrawals from the Permanent Fund? The Dunleavy plan to duck and cover doesn’t cut it.

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