Legislature(2015 - 2016)

2015-09-10 House Journal

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2015-09-10                     House Journal                      Page 1323
HB 2001                                                                                                                       
The following letter dated June 29, 2015, was received at 5:13 p.m.,                                                            
June 30:                                                                                                                        

2015-09-10                     House Journal                      Page 1324
"Dear Speaker Chenault:                                                                                                         
On this date, I have signed, with line item vetoes, the following bill                                                          
passed by the Second Special Session of the Twenty-Ninth Alaska                                                                 
State Legislature and am transmitting the engrossed and enrolled                                                                
copies to the Office of the Lieutenant Governor for permanent filing:                                                           
     CONFERENCE CS FOR HOUSE BILL NO. 2001                                                                                      
     "An Act making appropriations for the operating and loan                                                                   
     program expenses of state government and for certain programs;                                                             
     making appropriations for the operating expenses of the state's                                                            
     integrated comprehensive mental health program; capitalizing                                                               
     funds and repealing appropriations; making appropriations under                                                            
     art. IX, sec. 17(c), Constitution of the State of Alaska, from the                                                         
     constitutional budget reserve fund; and providing for an effective                                                         
     Chapter No. 1, SSSLA 2015                                                                                                  
     [Effective Date: See Chapter]                                                                                              
As passed by the Legislature, CCS HB 2001 contains appropriations                                                               
for fiscal years 2015 and 2016, totaling approximately $3.2 billion,                                                            
including $3 billion in unrestricted general funds. The bill includes                                                           
authorization for appropriations under Article IX, Section 17(c),                                                               
Constitution of the State of Alaska, from the constitutional budget                                                             
reserve fund. This is the second operating budget passed this year. The                                                         
first operating budget, (CCS HB 72(brf sup maj fld H)), contained                                                               
appropriations for fiscal years 2015 and 2016, but lacked the revenues                                                          
to fund the appropriations throughout the year. As a result, although I                                                         
signed the first operating budget (Ch. 23, SLA 15), it was with line                                                            
item vetoes.                                                                                                                    
The bill restores appropriations reduced through line item veto in Ch.                                                          
23, SLA 2015, authorizes additional appropriations, contains an                                                                 
Executive Branch-wide unallocated reduction of $29.8 million, and                                                               
includes an authorization for appropriations from the budget reserve                                                            
fund in an amount necessary to balance revenue and general fund                                                                 
appropriations (Article IX, Section 17, Constitution of the State of                                                            
Alaska). In addition, this budget includes an appropriation for salary                                                          
increases for covered and non-covered employees for the fiscal year                                                             

2015-09-10                     House Journal                      Page 1325
beginning July 1, 2015, and ending June 30, 2016. I am committed to                                                             
a responsible budget in these challenging fiscal times, yet also firm                                                           
that we must preserve services to maintain our economy and begin                                                                
developing a more stable revenue structure. Through line item veto, I                                                           
have made changes in CCS HB 2001 as outlined below:                                                                             
Section 8(b), page 64, lines 9 - 14, proposes that if the balance of the                                                        
oil and gas tax credit fund (AS 43.55.028) is insufficient to purchase                                                          
transferable tax credit certificates issued under AS 43.55.023 and                                                              
production tax credit certificates issued under AS 43.55.025 that are                                                           
presented for purchase, the amount by which the tax credit certificates                                                         
presented for purchase exceeds the balance of the fund, estimated to be                                                         
$700 million, is appropriated from the general fund to the oil and gas                                                          
tax credit fund (AS 43.55.028). I have reduced this appropriation to                                                            
$500 million, as it is apparent that the current oil and gas production                                                         
tax credit system is unsustainable. I support necessary incentives to                                                           
encourage oil and gas development, but in this challenging fiscal year,                                                         
we will continue to fund credits, but at a slower pace until a more                                                             
sustainable credit system is developed or our financial situation                                                               
improves. Compared to fiscal year 2015, this tax credit funding delay                                                           
of $200 million is in line with the reductions to other state budget                                                            
components. The capital budget is $476 million less than in fiscal year                                                         
2015, and agency operating budgets were reduced by $412 million.                                                                
I look forward to continuing to work with the Legislature to creatively                                                         
address our financial situation and continue to provide for economic                                                            
growth and development in the state.                                                                                            
Bill Walker