Juneau -- The House Finance Committee late Friday passed out House Bill 50, the State Operating Budget.

"This bill recognizes the cold, hard facts of life, that lower oil prices and declining production have led to lower revenues and higher deficits for the State of Alaska," said Representative Eldon Mulder (R-Anchorage), Committee Co-Chair. "We've gone over departmental operating budgets from nineteen subcommittees and produced a budget that, we believe, gives Alaskans the biggest bang for every buck they will spend over the next year on State government. Declining revenues left us no other option."

"We want to thank the subcommittee chairs, their members, and staff, who have spent literally thousands of hours producing this prudent and responsible budget," said Representative Gene Therriault (R-Fairbanks), Committee Co-Chair. "While it makes some very significant reductions, it also fully funds programs we felt required it and increases funding in selected areas."

House Bill 50, the House Finance Committee Operating Budget, reduces State spending by almost $40 million over last year's Operating Budget. It appropriates $2.1 billion in State General Funds to run State government in Fiscal Year 2000, which runs from July 1, 1999, to June 30, 2000.

"To paraphrase Abraham Lincoln: 'You can please all of the people some of the time and some of the people all of the time, but you cannot please all of the people all of the time,'" said Representative Con Bunde (R-Anchorage), Committee Vice Chair. "While some people are not going to be pleased with what we've done, I believe the overwhelming majority of Alaskans who take the time to study and understand it will see that this budget does a good job of allocating what resources we have at our disposal."

House Bill 50, the State Operating Budget, now moves to the full House, which is expected to begin its consideration of the measure Monday.

Broadcasters note: Audio comments are available on the Majority Actuality line, 1-800-478-6540
= Eldon Mulder, 91 K = Gene Therriault, 50 K

House Finance Committee Report:

• FY 00 GF Budget Recommendations
• Departmental Highlights

Notes:

1. Numbers are in $1,000's
2. Includes all General Funds
3. In the Department of Education AHFC Funds are counted as General Funds in both FY 99 and 00
4. Allocations include formula programs
5. Education Foundation Formula is fully funded
6. Produced by the House Finance Committee 4/9/99 8:58 p.m.

Administration

• Fully funded Office of Public Advocacy, Public Defender and Leasing. This is the first time in many years these programs have not been short-funded.
• Increased funding for the Pioneer Homes by $1.85 million to address the growing population of ADRD residents in the Homes. This will provide for 37 CNAs and 10 nurses.
• Public Radio was fully funded and a new appropriation of $89,000 for AIRRES, the reading service for the blind, was added to the budget. This service allows blind, disabled, elderly and shut-ins to live more independently by providing them with local, state and national news and events.
• Public TV funded
• Senior Services were fully funded at the Governor's requested level.

Community and Regional Affairs

• Focused on modest expansion of Child Care Assistance and Headstart.

Corrections

• Inmate population growth required additional funding for out of state contracts and associated increases in inmate health care.
• Reductions were found by eliminating non-essential positions and general belt-tightening in areas not critical to the department's mission.
• The subcommittee created a new federally funded Food Preparation Apprenticeship Program that will provide inmates with a highly marketable skill that can be used when they return to their communities.
• Funds were allocated to address the department's multi-million dollar deferred maintenance backlog.
• After addressing the department's most critical needs, the subcommittee was able to keep the budget nearly $4 million below the governor's request.

Commerce and Economic Development

• Funded five new Data Processing personnel that will enable the Department to offer more services on-line and improve internal efficiencies.
• Implemented a cost allocation plan that will help the Department in its efforts to gain federal approval of administrative holdback rates on federal grants.

Court System

• The Alaska Court System was fully funded at the FY 99 level. An additional increment of $200,000 added to cover recognized maintenance and operation costs.

Environmental Conservation

• Directed the department to create efficiencies totaling $213,000 in General Funds without ending core DEC services. D.E.C.
• Deleted non-essential, extra Public Information Officer (PIO) position ($68,899).
• Approved $249,000 in Drinking and Clean Water funds to effectively audit, account and loan money for low interest drinking water projects throughout the state.
• Approved $352,000 in Capital Improvement Project receipts to manage the increased federal funds for the Village Safe Water program. These funds will start 21 additional projects to provide safe water in rural communities.
• Authorized $1,150,000 of Federal receipts to gather baseline data for accurate permit decisions in the future.

Fish and Game

• Funded Department at FY 99 level, including "belt tightening."
• With cooperation from the Department, reductions in service will be minimized and efficiencies implemented.

Health and Social Services

• Fully funded the Adult Public Assistance program at the requested level.
• Increased the Child Care Benefits program.
• Increased funding for the Foster Care, Subsidized Adoptions, and Residential Care programs.
• Continued funding for 28 new Front Line Social Workers added in the previous year's budget.
• Increased the funding for Youth Corrections facilities.
• Increased funding to the Community Developmental Disabilities Grants.
• In cooperation with the Alaska Mental Health Trust Authority, secured funds for an additional $999,200 in the areas of Foster Care Special Need Training, Residential Child Care Training, Project Succeed to get children into permanent homes, and for Village Based Substance Abuse and Mental Health Services. The $825,400 from the Trust Authority helped to secure $173,800 in federal funds.

Labor

• Restored significant funding for OSHA to protect public employees.

Law

• Statehood Defense essentially remained at FY 99 level.
• Sufficient funding is in place for the Dept of Law to address the proposed BP-ARCO merger and other oil & gas litigation.

Military and Veterans Affairs

• The Department budget was held at the FY 99 level including the Governor's "belt tightening" measures.
• Important programs such as the Alaska National Guard, Youth Corps and Disaster Planning and Control are all maintained at their current level. DMVA (Continued)
• Veterans Services to provide continued funding for Veterans Outreach programs. $7.9 million in general funds for the Department brings an additional 24.1 million federal dollars into the states economy.

Natural Resources

• The Oil & Gas Development fully funded to FY 99 levels, allowing lease sales and other division activities to continue.
• Mining fully funded to FY 99 levels.
• Restored the $92,000 for the Citizens' Advisory Commission on Federal Areas eliminated in the Governor's proposed budget.
• Budgets for Agriculture programs increased slightly due to federal fund increases.
• State Parks funding remained constant compared to FY 99.

Public Safety

• Fish and Wildlife Protection increased at the Governor's request to support 87 Fish and Wildlife Protection Troopers.
• Funding for Trooper Detachments increased by over $1 million from the FY99 budget. This will fully fund 240 troopers.
• Funding for Laboratory Services increased by $172,500 to provide for two DNA Criminalist positions. This will facilitate the exchange of DNA evidence between law enforcement agencies and will speed closure of certain crimes.

Revenue

• Reduced funding for the Department by $586,000 in General Funds. The cuts reflect savings from the merger of two divisions and a funding source change that will allow CSED to maximize its use of federal funds and decrease its dependence on State General Funds.
• Approved $20,000 for the Alaska Mental Health Trust Authority's welfare-to-work program. This will allow AMHTA to hire two 6-month Welfare-to-Work interns.
• Reduced the Alaska Permanent Fund travel budget by $300,000. This money will go toward dividends in the future.

Transportation and Public Facilities

• Funded the normal spring opening of the Taylor and other roads/highways.
• Funded the costs to keep the Valdez hospital open at the Harborview facility.
• Approved transfers that allow weigh stations to operate longer hours and provide for increased vehicle inspections, translating into safer roadways.
• Approved various transfers which helps DOT&PF become more efficient (i.e. created contract appeals & statewide procurement component)

University of Alaska

• Budget increase of $5.6 million.