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Senate Finance unveils $1.9 billion capital budget

Posted: April 9, 2014 - 10:10am

JUNEAU — The Senate Finance Committee unveiled a $1.9 billion capital budget Monday, which co-chair Kevin Meyer said was in keeping with the goal of a smaller state infrastructure budget.

One of Meyer’s other goals was to have the state finish projects it has started and to maintain Alaska’s existing infrastructure. To that end, the bill includes $37.5 million to finish the state library, archives and museum building in downtown Juneau and $45.6 million to complete the engineering building at the University of Alaska Anchorage campus.

The bill keeps at $10 million funding for the engineering building at the University of Alaska Fairbanks, include up to $5 million from outside sources, such as naming rights for the building.

Meyer, R-Anchorage, said he was persuaded by university officials and co-chair Pete Kelly, R-Fairbanks, that a greater need for UAF at this point was a new power plant to provide energy for the campus. Meyer said he expected that issue to be addressed in part in an updated version of the capital budget, expected later this week. Along with that, he expected intent language that there either be a power surcharge, so students understand the need to close doors or windows to keep heat from escaping, or a tuition increase.

Senate Finance earlier this month proposed legislation to raise the borrowing limit of the Alaska Municipal Bond Bank to help the University of Alaska with financing for the power plant project. That would be seen as the overall package to help the Fairbanks campus.

The bill includes $10 million of the $42.7 million Gov. Sean Parnell had requested for the Susitna-Watana hydro project. Parnell had requested $10 million for next year and the rest in his supplemental budget request for the current budget year for the project, contingent upon the Alaska Energy Authority, or AEA, securing land-access agreements for project-related field work.

AEA announced it had reached agreement Friday, and Parnell’s budget director, Karen Rehfeld, said the administration would ask the committee to reconsider providing additional funding.

Meyer, in an interview before the draft budget rollout, said the focus has been on pursuing a gas line project. “And there’s some belief that we don’t need to and can’t afford to do both big projects,” he said. “So I think we kind of want to keep Watana on hold, not moth-balled, but just kind of see where the gas pipeline goes.” He said there should be a better sense on that in the next year or so.

The Senate Finance draft is about $403 million less than the capital budget, including supplemental capital items, approved by lawmakers last session, according to the Legislative Finance Division.

Also Monday, after several hours of debate, the Senate passed a $9.3 billion state operating budget on a 16-4 vote. That spending package will now be the subject of a conference committee, consisting of House and Senate negotiators.

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