Homer Alaska - Business

JUNEAU — Gov. Sean Parnell's $100 million deferred maintenance proposal is unlikely to pass the Legislature by next week's target date, and his administration is partly to blame, a Republican state lawmaker said Monday.

Rep. Bill Stoltze, co-chairman of the House Finance Committee, said Parnell's administration has been unable to get its budget together. He said some departments lacked adequate descriptions of how money would be used and not all projects were for maintenance.

Parnell set a March 1 target date for lawmakers to pass his proposal — so work could begin by summer — during last month's State of the State address.

Parnell spokeswoman Sharon Leighow said Monday that Management and Budget officials last week provided additional information on projects. She called a March 1 passage an "aggressive timeline" but said Parnell would still like to see his plan approved as soon as possible.

Stoltze said that at the very least, he expects deferred maintenance projects to be included in an overall capital budget. But there's likely to be sharp debate over how big that infrastructure pot gets — and on what projects money is spent. Stoltze said city managers, nonprofits and others have requested about $3.5 billion for local projects.

Parnell has proposed capping capital spending at about $400 million, excluding projects like a crime lab for which there's separate legislation. Members of the Senate's bipartisan majority have interpreted this as giving them about $100 million for community projects, a figure that doesn't sit well with lawmakers who say they held back on capital requests last year amid budget concerns.

Overall, Parnell has proposed a budget of about $10.5 billion for the fiscal year that starts July 1.

Rep. Mike Hawker, the finance co-chairman, hopes to have the committee version of an operating budget by Monday — and hopes to have it on the House floor around March 10. While Parnell has said he limited state agency operating growth to about 2 percent, Hawker said it's far higher than that when factoring in entitlement programs like Medicaid and public schools.

He said lawmakers are in a delicate but familiar situation, having to ask themselves if their "appetite for spending" has exceeded their ability to sustain spending levels. Oil would have to average $74 a barrel throughout the next fiscal year to break even with what Parnell has proposed, said Hawker, R-Anchorage. And there are costs that still must be accounted for, he said, such as yet-unresolved collective bargaining agreements with labor unions.

There won't be arbitrary cuts, Hawker said.

"But the objective is to absolutely minimize the growth of government to meet our essential needs without unnecessarily expanding any activity," he said.