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Alaska state budget and finances

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Alaska budget and finances
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General information
Budget calendar:
Annual
Fiscal year:
2015
State credit rating:
AAA (as of 2014)
Current governor:
Bill Walker
Financial figures
Total spending (state and federal funds):
$11.6 billion (estimated for 2014)
Per capita spending:
$15,733 (estimated for 2014)
Total state tax collections:
$5.1 billion (2013)
Per capita tax collections:
$6,962 (2013)
State debt:
$29.8 billion (as of 2014)
Per capita state debt:
$40,714 (as of 2014)
State budgets and finances
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Total state expendituresState debtTax policy in Alaska
Note: This page utilizes information from a variety of sources. As such, the currency of the information varies somewhat. The information presented on this page reflects the most recent data available as of February 2015.
Between fiscal years 2013 and 2014, total government spending in Alaska decreased by approximately $500 million, from $12.1 billion in fiscal year 2013 to an estimated $11.6 billion in 2014. This represents a 4.5 percent decrease. The cumulative rate of inflation during the same period was 1.58 percent, calculated using the Consumer Price Indices for January 2013 and January 2014. As of 2014, financial services firm Standard and Poor's had assigned Alaska a credit rating of AAA.[1][2][3]
In fiscal year 2014, total estimated spending in Alaska amounted to $11.6 billion. Alaska also had the highest state debt per capita in the nation at $40,714.

Spending

Definitions

The information below comes from the National Association of State Budget Officers (NASBO). These spending figures are broken into three broad categories in order to facilitate comparison between the states.[3]

  • State funds: State funds include general and other state-based funds. A general fund is "the predominant fund for financing a state's operations." Other state funds are "restricted by law for particular governmental functions or activities."
  • Federal funds: Federal funds are "funds received directly from the federal government."
  • Total spending: Total spending is calculated by adding together the totals for state and federal funds.

These figures exclude spending from the sale of bonds.

2014 expenditures

See also: Total state expenditures

The table below breaks down estimated spending totals for fiscal year 2014 (comparable figures from surrounding states are included to provide additional context). Figures for all columns except "Population” and “Per capita spending" are rendered in millions of dollars (for example, $2,448 translates to $2,448,000,000). Figures in the columns labeled "Population” and “Per capita spending" have not been abbreviated.[3]

Total estimated spending in Alaska amounted to $11.6 billion, lowest among its neighboring states. However, estimated per capita spending was the highest at $15,733.

Total estimated state spending, FY 2014 ($ in millions)
State State funds Federal funds Total spending Population Per capita spending
Alaska $8,620 $2,971 $11,591 736,732 $15,732.99
Oregon $20,175 $8,090 $28,265 3,970,239 $7,119.22
Washington $25,171 $9,102 $34,273 7,061,530 $4,853.48
Per capita figures are calculated by taking the state's total spending and dividing by the number of state residents according to United States Census estimates.[4]
Source: National Association of State Budget Officers

Spending by function

See also: State spending by function as a percent of total expenditures
Breakdown of spending by function in FY 2013.
Source: National Association of State Budget Officers

State spending in Alaska can be further broken down by function (elementary and secondary education, public assistance, etc.). Fiscal year 2013 information is included in the table below (information from neighboring states is provided for additional context). Figures are rendered as percentages, indicating the share of the total budget spent per category.[3]

In 2013 Alaska dedicated the largest single portion of its budget to transportation at 19.5 percent. The bulk of its budget was dedicated to expenditures classified as "Other."

State spending by function as a percent of total expenditures, FY 2013
State K-12 education Higher education Public assistance Medicaid Corrections Trans-
portation
Other
Alaska 13.7% 9.2% 1.1% 12.2% 3.3% 19.5% 41%
Oregon 14.3% 1.1% 0.7% 21.4% 3.9% 6.1% 52.6%
Washington 23.4% 14.3% 0.9% 11.9% 2.7% 8.9% 38%
Source: National Association of State Budget Officers
Note**: "Other" expenditures include "Children's Health Insurance Program (CHIP), institutional and community care for the mentally ill and developmentally disabled, public health programs, employer contributions to pensions and health benefits, economic development, environmental projects, state police, parks and recreation, housing and general aid to local governments."[3]

Spending trends

From 2009 to 2013, the portions of the Alaska state budget dedicated to K-12 education, Medicaid and transportation all increased. See the table below for further details (figures are rendered as percentages, indicating the share of the total budget spent per category).[3][5][6][7][8]

Spending by function from 2009 to 2013 (as percentages)
Year K-12 education Higher education Public assistance Medicaid Corrections Transportation Other
2013 13.7% 9.2% 1.1% 12.2% 3.3% 19.5% 41%
2012 13.4% 9.3% 1.1% 11.6% 3.0% 16.8% 44.8%
2011 11.0% 8.3% 0.9% 9.3% 2.5% 11.9% 56.2%
2010 14.6% 8.6% 1.2% 12.0% 3.2% 17.0% 43.4%
2009 10.0% 7.5% 0.9% 7.5% 2.3% 14.9% 57.0%
Source: National Association of State Budget Officers
Note**: "Other" expenditures include "Children's Health Insurance Program (CHIP), institutional and community care for the mentally ill and developmentally disabled, public health programs, employer contributions to pensions and health benefits, economic development, environmental projects, state police, parks and recreation, housing and general aid to local governments."[3]

Revenues

2013 revenues

See also: State government tax collections by source

The table below breaks down state government tax collections by source in 2013 (comparable figures from surrounding states are also provided to give additional context). Figures for all columns except "Population" and "Per capita revenue" are rendered in thousands of dollars (for example, $2,448 translates to $2,448,000). Figures in the columns labeled "Population" and "Per capita revenue" have not been abbreviated.[9]

Alaska does not have a state income tax or statewide sales tax. Alaska's total revenue collections in 2013 amounted to $5.1 billion, lowest among its neighboring states. Its per capita revenue collections were the highest among its neighboring states at $6,962.

State tax collections by source ($ in thousands)
State Property taxes Sales and gross receipts Licenses Individual income taxes Corporation net income taxes Other taxes Total 2013 population Per capita collections
Alaska $99,598 $249,586 $135,720 N/A $630,941 $4,016,966 $5,132,811 737,259 $6,962.02
Oregon $19,893 $1,369,266 $923,123 $6,260,161 $459,744 $128,700 $9,160,887 3,928,068 $2,332.16
Washington $1,939,883 $14,647,173 $1,359,685 N/A N/A $720,303 $18,667,044 6,973,742 $2,676.76
Source: Tax Policy Center, "State Tax Collection Sources 2000-2013," June 20, 2014
Alaska tax collections by source in 2013.
Source: Tax Policy Center

The table below lists 2013 tax collections by source as percentages of total collections. In Alaska, taxes falling into the category of "Other" accounted for 78.3 percent of total collections.[9]

State tax collections by source (as percentages)
State Property taxes Sales and gross receipts Licenses Individual income taxes Corporation net income taxes Other taxes
Alaska 1.94% 4.86% 2.64% N/A 12.29% 78.26%
Oregon 0.22% 14.95% 10.08% 68.34% 5.02% 1.40%
Washington 10.39% 78.47% 7.28% N/A N/A 3.86%
Source: Tax Policy Center, "State Tax Collection Sources 2000-2013," June 20, 2014

Current fiscal year budget

See also: Historic Alaska budget and finance information

Fiscal year 2015

DocumentIcon.jpg See budget bill: S.B. 119 (Capital Budget), H.B. 266 (Operating Budget), H.B. 267 (Mental Health Budget)

Governor Sean Parnell announced his fiscal year 2015 budget proposal on December 12, 2013. Under the governor's proposal, total state spending for fiscal year 2015 would have equaled approximately $12.4 billion, including $1.26 billion in K-12 education spending.[10]

On May 28, 2014, Parnell signed into law three separate budget bills -- one for state operations, one for capital projects and one for mental health programs -- totaling approximately $12.8 billion. The enacted budget included an additional $300 million for K-12 education over fiscal year 2014 expenditures.[10][11]

State debt

See also: State debt

According to a January 2014 report by the nonprofit organization State Budget Solutions, Alaska had a state debt of approximately $29.8 billion. Its state debt per capita was $40,714. The report revealed that state governments faced a combined $5.1 trillion in debt. The obligation amounted to $16,178 per capita in the nation.[12]

Total state debt, 2014
State Total state debt State debt per capita Per capita debt ranking
Alaska $29,780,396,000 $40,714 1
Oregon $86,678,268,000 $22,229 8
Washington $89,579,477,000 $12,988 32
Sources: State Budget Solutions, "State Budget Solutions' Fourth Annual State Debt Report," January 8, 2014

Public pensions

See also: Alaska public pensions and Alaska public employee salaries

A 2012 report from the Pew Center on the States noted that Alaska's pension system was funded at 60 percent at the close of fiscal year 2010, well below the 80 percent funding level experts recommend. Consequently, Pew designated the state's pension system as cause for "serious concern."[13]

Taken together, the funding ratio for the state's pension systems decreased from 74.2 percent in fiscal year 2006 to 54.7 percent in fiscal year 2012, a decrease of 24.7 percentage points, or 33.3 percent. Likewise, unfunded liabilities increased from approximately $3.4 billion in fiscal year 2006 to more than $8 billion in fiscal year 2012.[14][15][16][17]

Credit ratings

See also: State credit ratings

Credit rating agencies, such as Standard and Poor's, assign grades to states that take into account a state's ability to pay debts and the general health of the state's economy. Generally speaking, a higher credit rating indicates lower interest costs on the general obligation bonds states sometimes sell to investors in order to finance large-scale undertakings (e.g., road construction and other public works projects). This in turn results in lower interest costs, thereby lowering the cost to taxpayers.[18][19]

The table below lists the Standard and Poor's credit ratings for Alaska and northwestern states from 2004 to 2014. Standard and Poor's grades range from AAA, the highest available, to BBB, the lowest.[20]

State credit ratings, 2004 to 2014
State 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004
Alaska AAA AAA AAA AA+ AA+ AA+ AA+ AA AA AA AA
Oregon AA+ AA+ AA+ AA+ AA AA AA AA AA- AA- AA-
Washington AA+ AA+ AA+ AA+ AA+ AA+ AA+ AA+ AA AA AA
Source: Stateline: The Daily News Service of The Pew Charitable Trusts, "Infographic: S&P State Credit Ratings, 2001-2014," June 9, 2014

Federal aid to the state budget

See also: Federal aid to state budgets

State governments receive aid from the federal government to fund a variety of joint programs, such as Medicaid. Federal aid varies considerably from state to state. For example, Mississippi received approximately $7.7 billion in federal aid in 2012, which accounted for more than 45 percent of the state's general revenues. By contrast, Alaska received roughly $2.9 billion in federal aid in 2012, just under 20 percent of the state's general revenues.[21]

The table below notes what share of Alaska’s general revenues came from the federal government in 2012. That year, Alaska received approximately $2.9 billion in federal aid, nearly 20 percent of the state's total general revenues. Figures from surrounding states are provided for additional context.[21]

Federal aid to state budgets, 2012
State Total federal aid ($ in thousands) Federal aid as a % of general revenue Ranking
Alaska $2,860,509 19.97% 50
Oregon $7,830,552 36.04% 13
Washington $9,743,127 28.59% 37
Source: United States Census Bureau, "State Government Finances: 2012," accessed February 24, 2014

Stimulus

According to Recovery.gov, the official government website for the Recovery Accountability and Transparency Board, under the American Recovery and Reinvestment Act, Alaska received $2,030,660,000.00 in federal funding between February 2009 and June 2013.[22]

Budget process

The state operates on an annual budget cycle, with the fiscal year beginning July 1 and ending June 30. The sequence of key events in the budget process is as follows:[23][24]

  1. Budget instructions are sent to state agencies in July.
  2. Agencies submit their budget requests to the governor in October.
  3. Agency budget hearings are held from September through November.
  4. The governor submits his or her proposed budget to the state legislature by December 15.
  5. The legislature adopts a budget by a simple majority in April.

The governor is required by statute to submit a balanced budget. Likewise, the legislature is required by statute to pass a balanced budget.[24]

In Alaska, the governor has line-item veto and item veto of appropriations authority.[24][25]

Agencies, offices and committees

The following standing committees in the Alaska State Legislature deal with budget and finance matters:

  1. Finance Committee, Alaska House of Representatives
  2. Finance Committee, Alaska State Senate

The Alaska Comptroller serves within the Alaska Department of Revenue, Treasury Division. The comptroller is appointed by the governor and is a nonpartisan office. Some of the duties of the position include reporting on the state's finances and investments, developing and monitoring the treasury's budget, and advising the Deputy Commissioner of the Department of Revenue.[26]

The Alaska Revenue Commissioner is the head of the Alaska Department of Revenue. The commissioner is also appointed by the governor and is a nonpartisan office. Some of the duties of the position include overseeing the department in its mission, holding hearings and conducting investigations related to tax laws, and maintaining the state's public school trust fund.[27]

Studies and reports

U.S. PIRG "Following the Money" report

See also: "Following the Money" report, 2014

The U.S. Public Interest Research Group, a consumer-focused nonprofit organization based in Washington, D.C., released its annual report on state transparency websites in April 2014. The report, entitled "Following the Money," measured how transparent and accountable state websites are with regard to state government spending.[28] According to the report, Alaska received a grade of F and a numerical score of 43, indicating that Alaska was "failing." in terms of transparency regarding state spending.[28]

Budget background

Alaska does not have a state income tax or statewide sales tax. 82% of Alaska’s estimated state revenues for 2010 are from oil taxes, royalties and fees.[29] Alaska has the lowest tax burden of all 50 states.[30]

Budget and finance ballot measures

Voting on
state and local
government budgets,
spending and finance
State finance.jpg
Policy
Budget policy
Ballot measures
By state
By year
Not on ballot
See also: Spending and finance on the ballot and List of Alaska ballot measures

Ballotpedia has tracked the following ballot measures relating to state and local budget and financial matters in Alaska.

  1. Alaska Budget Powers of Legislative Interim Committees, Proposition 2 (1978)
  2. Alaska Budget Reserve Fund, Measure 1 (1990)
  3. Alaska Limitation on State Budget Appropriations, Measure 4 (1982)
  4. Alaska Mineral Revenue Fund, Proposition 2 (1976)
  5. Alaska Permanent Fund Advisory Question (1999)
  6. Alaska State Budget Appropriations, Measure 1 (1986)
  7. Alaska State Debt for Student Loans Amendment (2016)

Recent news

This section displays the most recent stories in a Google news search for the terms "Alaska budget."

Some of the stories below may not be relevant to this page due to the nature of Google's news search engine.

Alaska state budget and finances - Google News Feed

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See also

External links

Additional reading

References

  1. Bureau of Labor Statistics, "CPI Detailed Report Data for February 2014," accessed April 9, 2014
  2. InflationData.com, "Cumulative Inflation Calculator," February 28, 2014
  3. 3.0 3.1 3.2 3.3 3.4 3.5 3.6 National Association of State Budget Officers, "State Expenditure Report: 2012-2014," accessed February 18, 2015
  4. United States Census Bureau, "State and County QuickFacts," accessed February 23, 2014
  5. National Association of State Budget Officers, "State Expenditure Report, 2009-2011," accessed February 24, 2014
  6. National Association of State Budget Officers, "State Expenditures Report, 2010-2012," accessed February 24, 2014
  7. National Association of State Budget Officers, "State Expenditure Report, 2009," accessed February 24, 2014
  8. National Association of State Budget Officers, "State Expenditure Report, 2008," accessed February 24, 2014
  9. 9.0 9.1 Tax Policy Center, "State Tax Collection Sources 2000-2013," June 20, 2014
  10. 10.0 10.1 National Association of State Budget Officers, "Summaries of Fiscal Year 2015 Proposed and Enacted Budgets," July 11, 2014
  11. State of Alaska, "SLA2014 Enacted Fiscal Summary," accessed September 22, 2014
  12. State Budget Solutions, "State Budget Solutions' Fourth Annual State Debt Report," January 8, 2014
  13. "Widening Gap Update: Alaska," June 18, 2012
  14. "National Guard and Naval Militia Retirement System Actuarial Valuation Report as of June 30, 2012," accessed October 28, 2013
  15. "Public Employees' Retirement System Actuarial Valuation Report as of June 30, 2012," accessed October 28, 2013
  16. "Teachers' Retirement System Actuarial Valuation Report as of June 30, 2012," accessed October 28, 2013
  17. "Elected Public Officers Retirement System Actuarial Valuation Report as of June 30, 2012," accessed October 28, 2013
  18. Stateline: The Daily News Service of The Pew Charitable Trusts, "Infographic: S&P State Credit Ratings, 2001-2012," July 13, 2012
  19. Bankrate, "The 6 states with the worst credit ratings," September 27, 2012
  20. Stateline: The Daily News Service of The Pew Charitable Trusts, "Infographic: S&P State Credit Ratings, 2001-2014," June 9, 2014
  21. 21.0 21.1 United States Census Bureau, "State Government Finances: 2012," accessed February 24, 2014
  22. Recovery.gov, "Stimulus Spending by State," accessed April 15, 2014
  23. National Conference of State Legislatures, "State Experiences with Annual and Biennial Budgeting," updated April 2011
  24. 24.0 24.1 24.2 National Association of State Budget Officers, "Budget Processes in the States, Summer 2008," accessed February 21, 2014
  25. NCSL, "Gubernatorial Veto Authority with Respect to Major Budget Bill(s)," accessed March 2, 2014
  26. Workplace Alaska, "Job Class Specifications, Class Title: State Comptroller," accessed August 14, 2013
  27. Alaska Legal Resource Center, "Alaska Statutes 43.05.010," accessed June 6, 2011
  28. 28.0 28.1 U.S. Public Interest Research Group, "Following the Money 2014 Report," accessed April 15, 2014
  29. Reuters, “Alaska sees $1.25 billion budget gap on oil price drop,” February 19, 2009
  30. Tax Foundation "Monday Maps: State and Local Tax Burdens vs. State Tax Collections" May 2010