Lawmakers need to resolve budget gap now, so keep the pressure on

Watching the budget debate in Juneau is painful and confusing! The one thing that is very clear is that the Legislature must solve our fiscal problem this session or push Alaska into serious recession. We must agree now on how to fund state government in a sustainable way. We cannot rely on our savings account (the Constitutional Budget Reserve) to save us one more year because then it will be depleted, and we will be out of time to develop a sustainable revenue system.  And we must agree on a level of services that will be affordable and enable our state to continue to be a good place to live.

The operating budget passed by the House offers the best option.

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Legislation passed by the House would restructure the Permanent Fund so that it will sustainably provide revenue of, initially, about $1.7 billion AND continue to pay the Permanent Fund dividend, initially $1,250 annually. Another bill adopted by the House would also establish an income tax that would raise about $700 million annually when fully implemented. These two sustainable sources of revenue would cover most of the gap between the costs of government services and existing revenues such as income from oil that would be left after the restructuring of the Permanent Fund.

Importantly, it is the addition of the income tax that makes it possible to adequately fund education both at the local level and at the university. Education is one of the most important services government must provide in a democratic system of government. A democracy can only survive if its voters are educated. I fear that those who would slash education funding are doing the bidding of large corporations and extremely wealthy donors who are motivated by self-interest. (Read the book "Dark Money"!)

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A broad-based sales tax is a possible alternative to an income tax, but I believe an income tax is fairer. Alaska has the distinction of having less income inequality than almost all of the other states. That is another foundation of democracy and it is made possible here by our unique PFD. But because we now need to use some of the earnings of the Permanent Fund to pay for government services, the PFD must be reduced from its recent high levels. That hits those at the bottom of the income scale hardest. An income tax will hit those most able to pay harder than those at the bottom, thus creating a fair system.

In contrast, a sales tax would hurt those at the lower end of the scale hardest thus putting a very heavy burden on those who are already struggling to make ends meet. In addition, many municipalities already have a sales tax.

We have only a few weeks left in this fiscal year. The Legislature must complete its work before June 30 or government will shut down. We must keep the pressure up on our legislators! Keep those messages to legislators and letters to the editor coming!

Helen Nienhueser is retired from Alaska's Department of Natural Resources, a board member of Alaska Common Ground, a graduate of Harvard's Kennedy School of Government, and co-author of "55 Ways to the Wilderness in Southcentral Alaska."

The views expressed here are the writer's and are not necessarily endorsed by Alaska Dispatch News, which welcomes a broad range of viewpoints. To submit a piece for consideration, email commentary@alaskadispatch.com. Send submissions shorter than 200 words to letters@alaskadispatch.com.