“This is ground zero on the capital budget,” says Pat Pitney, the new director of the Office of Management and Budget.
The capital budget submitted on Monday is largely made up of items that come with federal grant money. Only a few items — a couple of water treatment plants, a sewage project, a school project in Kivalina that the state is legally mandated to complete because of a lawsuit over rural education disparities — have no federal funding attached.
“This is an unendorsed budget,” says Pitney. “We haven’t had time to evaluate all of the projects. We did know we want to keep the transportation funds and those projects that rely heavily on matched funding.”
Rep. Steve Thompson, co-chair of the House Finance Committee, is also undecided on a target spending number. But the Fairbanks Republican expects appropriations to be substantially reduced from previous years, with critical projects for health and safety getting the most consideration.
“I don’t think people are going to be wanting to flex their muscles too much with the financial situation the state is in,” says Thompson.
Thompson adds that he wasn’t surprised to see the capital budget stripped mostly to projects with matching funds.
“I didn’t think there was going to be anything other than possibly federal grant match money,” says Thompson. “I’ve been warning people that’s what it was starting to look like prior to this coming out.”
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