Legislature(2011 - 2012)
2012-09-25 House Journal
Full Journal pdf2012-09-25 House Journal Page 2687 HB 284 The following letter was dated May 14 and received May 15, 2012, at 11:55 a.m.: "Dear Speaker Chenault: On this date, I signed with line item vetoes, the following bill passed by the second session of the Twenty-Seventh Alaska State Legislature and am transmitting the engrossed and enrolled copies to the Lieutenant Governor's Office for permanent filing: 2012-09-25 House Journal Page 2688 CONFERENCE CS FOR HOUSE BILL NO. 284 "An Act making appropriations for the operating and loan program expenses of state government and for certain programs, capitalizing funds, amending appropriations, and making reappropriations; and providing for an effective date." Chapter No. 15, SLA 2012 [Effective Date: See Chapter] Our Administration's goals are to promote economic opportunity and strengthen Alaskan families. The budget I presented for legislative consideration and the budget I sign today reflect those priorities. House Bill 284, as passed by the Legislature, contained appropriations for Fiscal Year 2012 and Fiscal Year 2013 totaling $12.0 billion, of which $6.6 billion is unrestricted general fund. The budget includes special appropriations for tax credits, revenue sharing, and direct deposits to the retirement system costs, and includes funding for public education, the university, public health and safety, transportation, resource development, and funding for State government programs, services, and grants. In addition, HB 284 saves for Alaska's future. HB 284 includes appropriations of $2.0 billion to the Statutory Budget Reserve, $1.1 billion to forward fund K-12 education in FY 2014, and $1.5 billion for inflation proofing of Alaska's Permanent Fund and Permanent Fund Dividends. Through line-item vetoes, I have reduced a limited number of appropriations in HB 284, totaling $54.1 million. The following describes the reasons for the vetoes, which are also detailed in the enclosed spreadsheet. Judicial Retirement System (JRS) - Let me be clear that we have met and will continue to meet our obligations to our retirees. The FY 2013 budget includes $613.9 million for the actuarially required payments for all of our systems - JRS, PERS, and TRS. These payments will continue. However, I have vetoed the additional lump sum appropriation to the judicial retirement system to pay down the unfunded liabilities of the system for several reasons. 2012-09-25 House Journal Page 2689 This appropriation would not fully pay down the current unfunded liability for JRS, which has now grown to $58 million. In FY 2008, the Legislature deposited $49 million into the JRS trust fund. Due to market volatility, the liability quickly returned. Unusual volatility continues to be a reality in the investment markets. Additionally, unless good reason exists to the contrary, we should address each of the State's retirement systems consistently. Rather than taking this $50 million off the table at this time for JRS alone, it is in Alaska's interest to further evaluate whether changes are needed with respect to how we address the unfunded liabilities of PERS, TRS, and JRS. We should continue to explore together the best ways of meeting our goals of maintaining the health of the funds and managing the State's costs over time. I am committed to working with you on this endeavor. Early Learning Coordination - This year, I have approved an increase of $3,867,500 for early learning programs - a 38 percent increase in funding over the current year. The enclosed chart illustrates the growth in early learning programs over the past four years. Funding for the line item designated Alaska's Statewide Pre- Kindergarten Program has increased from $1.7 million in the current year to $2.5 million in FY 2013, a 47 percent increase. We are also increasing Pre-K efforts by $2 million through the Moore settlement for Alaska's most vulnerable schools. Funding for Parents as Teachers (PAT) has been increased from $300,000 to $1,042,500 in the next fiscal year. I have reduced the fiscal impact for the newly approved pilot project created by passage of SB 182, to reflect a realistic start up for the program. PAT is a new program, and the three year pilot will provide the data needed to evaluate the success of the project, rather than allow explosive growth from the outset. In signing the budget, I also approved one-time funding for the North Slope Borough School District (NSBSD) for curriculum alignment, integration, and mapping. It is unusual for this type of project to be included in the operating budget, and it is not my intention to encourage school districts to seek designated grants. These projects are typically conducted with school district's foundation formula funding. However, I believe this project will provide valuable tools for other 2012-09-25 House Journal Page 2690 Alaska school districts, and I have asked the Department of Education and Early Development to work closely with the NSBSD to make this resource available to other districts as a condition of receiving State funding. Finally, I have deleted Sections 20(f) and 35 regarding implementation funding for the Alaska coastal management program initiative, contingent upon approval by the voters during the August primary election. Prefunding an unpassed initiative is inconsistent with historical practice. The Administration will request funding for program implementation, if necessary. Building on the success we were able to achieve this legislative session on the budget, I look forward to further refining our spending targets for both the operating and capital budget in the future. Sincerely, /s/ Sean Parnell Governor" Spreadsheets from the Office of the Governor, Office of Management and Budget, pertaining to budget vetoes accompanied the letter and are on file in the Chief Clerk's office.