LEGISLATURE, CONTINUED from PAGE 10
do with $2 billion-plus in federal pan- demic relief aid pouring into the state from Washington, D.C. Most of the fed- eral aid money comes with few strings attached and only a timeline that ex- penditures must be made by the end of 2024. Some funds, like a $112 million allocation for capital, or construction, projects, have no timeline. $1 billion of this comes directly to the state, but its spending must be detailed in an appropriation bill passed by the Legislature and signed by the governor. Under terms set by Congress, the rest of the “American Rescue Plan” for Alaska goes directly to Alaska municipalities, school districts and other entities. Senate President Peter Micciche, R-Kenai, has recommended that the $1 billion to the state be appropriat- ed over two to three years, with per- haps $500 million approved for FY 2022. Some of this will likely go to re- place state revenues lost in 2020 when COVID-19 hit as well as to pay costs agencies incurred dealing with the pandemic and which were not com- pletely compensated for in two previ- ous packages of federal aid in 2020, including the CARES act. Municipal governments will likely so the same with money coming to them. However, the Legislature and local governments have a lot of latitude in what they can do with the money, and substantial investments in infrastructure like water and sewer, transportation fa- cilities and broadband are expected. A lot will also go to catching up on deferred maintenance. Since 2016, when oil prices plummeted, Alaska governors and legislators have conditioned them- selves to austere budgets that included hundreds of millions of dollars in cuts to annual spending, layoffs of hundreds of public employees, and a dearth of state capital spending that has allowed a dan- gerous $2.7 billion backlog of deferred maintenance to build up in schools, the university and public buildings. Alaska’s economy has suffered from the cuts in oil activity last spring and the collapse of the state’s summer tourism season a few months later, as well as a contraction of the state’s gen- eral economy — restaurants, recreation and retail — as municipal governments ordered lockdowns and put the clamps on socializing.
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Photo taken pre-COVID
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Tim Bradner is editor and publisher of the Alaska Legislative Digest
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The Alaska Miner
April 2021
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