Press Release - Constitutional Spending Limit 10.6.15
Published on: Mar 4, 2016
Transcripts - Press Release - Constitutional Spending Limit 10.6.15
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Fiscalresponsibility calls for review of constitutional spending limits.
Anchorage, October 6, 2015 Republican House Candidate Myranda Walso calls for citizens and public
officials to revisit the constitutional amendment restricting government spending.
In late 1982 the Alaskan people took a stand.Citizens,fearing that state government wasgrowing out of control,
passed a referendum and constitutionalamendment limiting state spending. This spending limit became law in
fiscalyear 1984,and put a ceiling on the state budget. Adjustmentswere built in to account for changesin
population, price,and inflation. Since then,over the past three decadeswhatever good the limit did has been
rendered completely ineffective and failed to ensure responsible,restrained spending from our legislature.
The spending limit placed a ceiling on appropriations,benchmarked at $2.5 billion in the base year.Exempt
from that were debt service,Permanent Fund dividend payments,voter-approved capitalexpenditures,and
supplementary Permanent Fund appropriations.The limit also specifies that at least 33% of appropriations must
go towards capitalexpendituresand loans.Currently,the spending limit is not in any way a realconstraint
because the rising ceiling has greatly outstripped revenues. This gap represents the amount of revenuesthat
would be required from newsourcesto keep state spending aligned with the ceiling as defined by the limit
In the coming years,public sector demands forproviding basic services in education,health and human
services,protection,etc. willcontinue to grow with the economy.However,we only have revenues to fund a
smallfraction of governmentprograms. We musthave a long term fiscalplan in place,which takesinto account
the depletion of our resourcesand ensuresAlaskanshave a reliable long-term funding stream in place for
government operations and obligation. In order to make that outcome more likely,we can and must lower the
spending limit ceiling to an effective and substantiated level. This can reduce and delay the revenue gap,giving
us time to craft a wellthought out plan moving forward.
A lower spending limit would help the state both live within its means and ensure in good fiscaltimes we save
adequate reservesfor future occasions. Without a meaningfulconstitutionalamendment in place that limits the
amount of state generaland capitalfund expenditures,there is absolutely no guarantee thatthe state willreduce
However,this willnot eliminate the revenue gap problem,only postpone it. It does give Alaskanssome comfort
thought that our governmentis carefulto utilize public funds wisely,and reduce the inefficiencies and
questionable spending of state funds that hasplagued public spending for decades. Eventually,a spending
restriction holding annualappropriations at or even below the levelof sustainable revenue generation ensures
we alllive within our means and avoid future crises.
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