Alaska House committee budget plan would provide less relief, save more than Dunleavy proposal

Alaska House Finance Committee members listen to a presentation on the committee proposal for how to spend American Rescue Plan Act funds on April 23, 2021, in the Alaska State Capitol in Juneau, Alaska. (Photo by Andrew Kitchenman/KTOO and Alaska Public Media)
Alaska House Finance Committee members listen to a presentation on the committee proposal for how to spend American Rescue Plan Act funds on Friday, April 23, 2021, in the Capitol. (Photo by Andrew Kitchenman/KTOO and Alaska Public Media)

The Alaska House Finance Committee proposed a very different plan from Gov. Mike Dunleavy on how to spend $1 billion in federal aid.

The draft committee plan released on Friday would free up roughly $410 million by using American Rescue Plan Act funds to replace state revenue. That money could be spent on permanent fund dividends; roads and other capital projects; or other items. 

The committee will consider changes to the draft proposal next week.

The proposal would provide grants totaling $80 million for local governments, $30 million for businesses and $30 million for nonprofits to offset money lost due to the pandemic. It also includes money $42 million to offset lost cruise-ship taxes.  

Roughly 30% of the $1 billion in federal rescue money would be held for next year. 

Dunleavy had proposed spending much larger amounts than the committee in relief for the tourism industry, other businesses and infrastructure, and replacing a much lower amount in state revenue — $139 million. 

The committee included its plan for the federal money in its overall draft proposal for the state operating budget that begins in July, which it also unveiled on Friday. That proposal is similar to what the governor proposed, except it doesn’t include funds for PFDs. 

The Legislature set the dividend amount shortly before the end of the session the last two years. Under the state constitution, the session must end by May 19. 

Committee members can propose amendments to the budget on Monday, April 26. When the committee is done with the budget, the full House will consider it. The Senate is working on its version of the budget.