At first blush, it is easy to be disappointed in the Governor’s decision to veto funds vital to local governments during this public health and economic crisis. Instead of bolstering support at the local level, where municipal employees are often the first responders, the Governor’s vetoes thrust decision-makers into an uncertain and untimely process. We want to recognize and thank the Legislature for its work to ensure that those funds were in the final budget in the first place.
However, AML is also committed to working with the Governor to follow up on his commitment to replace many of these funds through the stimulus funding provided by the federal government. AML has been carefully following the federal process and are hopeful for what should be available to Alaska’s cities and boroughs.
While local governments in other states may have access to as much as 45% of the funds received by their states, we know that Alaska doesn’t meet the criteria for direct access. It’s left to us to work with the administration to ensure that local governments receive the help intended for them from the CARES Act, based on additional and unexpected expenses at the local level.
We are also advocating for a potential CARES Act 2 or Phase IV of stimulus funding at the federal level. Future Congressional legislation should be intended to secure smaller or rural local government relief that was overlooked in the original CARES bill. The specific details are still under discussion at this point.
We do not believe that now is the time to challenge these decisions, but to ensure that we can back the Governor up in advocating that the State be allowed to spend these funds as flexibly as possible, and in the interest of Alaskans and Alaska’s local governments. AML has worked with our members to identify where there are unanticipated expenditures, and potential impact to budgets that these and decreased revenues will have. There’s a strong case to be made for investment in Alaska’s cities and boroughs.
Unfortunately, this conversation comes at a time when local government officials are developing budgets for the next fiscal year. Uncertainty now means a very conservative approach that will have to be taken, even as we remain hopeful that the State can in fact assist in response to this public health and economic crisis. We appreciate the Governor’s office maintaining good communication throughout the crisis and for indicating every intention to support local governments.
With the release of the spring revenue forecast, it remains clear that the State will struggle with its ability to fund the essential services it provides, and its Constitutional and statutory obligations. AML has advocated for many years a sustainable fiscal plan and remains committed to working with the State toward that end, now more than ever.