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Governor Dunleavy Restores Budgetary Discipline to FY22 State Spending Plan

Jul 1, 2021

July 1, 2021 (Anchorage, AK) – Governor Mike Dunleavy today announced line item vetoes totaling $215 million to the budget passed by the legislature that restores fiscal discipline, protects essential state services, maximizes the use of federal funds (CARES, CRRSA, ARPA) while preserving general fund dollars available for future state spending. The Governor also took the necessary step of vetoing the paltry $525 dividend decided by a legislative conference committee behind closed doors that Alaskans consider unacceptable when the permanent fund has swelled to a total value exceeding $81 billion.

“The budget that emerged from the legislative conference committee was not well received by the majority of Alaskans due to a perceived lack of transparency and an arbitrary PFD amount that doesn’t come close to assisting Alaskans who are still recovering from the pandemic,” said Governor Dunleavy. “We significantly reduced spending without cutting jobs while still making smart investments in public safety and maintaining all essential state services. In other words, it reflects the original intent of the budget my administration proposed earlier this year. Stabilize the economy and get Alaskans back to work without raising taxes.”

Here are some more highlights of the Dunleavy administration’s amended FY22 budget:

  • Increases funding for public safety and programs to reduce domestic violence and sexual assault.
  • Establishes an 18 month schedule for the Alaska Marine Highway System.
  • Protects education funding.
  • Funds the largest capital budget in seven years, creating jobs, infrastructure and economic opportunity.
  • Creates the Statehood Defense Fund to defend Alaska from federal intrusion to halt natural resource production and take away our Second Amendment rights.
  • Removes hundreds of unfilled and unneeded vacant positions in state government added by the House and Senate Finance Committees.
  • Preserves general fund dollars by asking local governments, school districts and other entities use the millions in federal relief funds they already have.
  • Directs the Alaska Mental Health Trust Authority to pay for new programs and services with its own assets – those programs were improperly funded with state revenue
  • Vetoes $2.0 million in per diem for the Alaska Legislature’s FY 22 budget. Lawmakers need to finish the work on protections for the permanent fund and the PFD before paying themselves.
  • The total FY 22 operating budget is $4.0 billion, a reduction of $450 million, or a 10% reduction from the FY 21 budget.

“The Legislature met its constitutional duty to avoid a shutdown, but we still have a lot of work to do because the budget remains incomplete. I look forward to sitting down with lawmakers during the upcoming special session to get Alaskans a fair and sizable PFD that reflects my 50/50 proposal, pass a constitutional amendment that, if approved by voters, will settle the PFD debate once and for all and see if they can muster the votes to pass the CBR reverse sweep so important programs like university scholarships are properly funded,” added Governor Dunleavy.



Click here for the OMB documents.


The FY 22 Budget FAQ, PFD FAQ, and the Total Federal COVID Funds In Alaska: March 2020-June 2022 fact sheet are attached.