Rep. Ben Carpenter
Alaska House of Representatives, District 8

Bill Highlight HB 194 Executive Budget Act

Sponsor Statement

Alaska’s government spends twice as much as other states, but its policy performance is abysmal. When national rankings of performance metrics in key social and economic areas are released, we often come close to the bottom.

Alaska’s economic growth is the worst in the nation. Employment is second worst in the nation. More than seventy thousand more people have left Alaska for other states than have moved here from other states. Education test scores have been consistently at the bottom, violent crime is high, university four-year graduation is almost non-existent. We are doing something wrong.

Pouring more money into our problems is not working. Alaska’s spending per capita is the highest in the nation. Our debt per capita is 7th highest. We have the 10th highest welfare dependency and fewer education choice options than the majority of states. Florida spends a quarter of what Alaska does and Florida scores very high on its policy outcomes. If you don’t believe the data, believe the 1.6 million people who have moved to Florida from other states over the last ten years.

Our performance-based budgeting statute should help us with our inverse relationship between inputs and outcomes, but it has not. The Alaska executive budget act requires the Governor and state agencies to use performance data in its budgeting process and to provide such information to the legislature for its budget deliberations. The Executive Budget Act is vague and has not produced a results-based state budget. Data provided by executive departments is insufficient for program evaluation, planning and budgeting.

HB 194 amends the executive budget act requirements of the executive and the legislature for results-based budgeting to clearly identify service, program, and financial goals. It requires the Governor’s budget to be organized by program and service of each agency and include financial, program, and service cost and measured results for each.

HB 194 requires the legislature, through the legislative budget and audit committee, to set the program and financial goals that must be used by the executive in formulating its budget and requires the legislature to review the budget in the same manner. HB 194 requires the Governor to ensure that each agency complies with the service or program measurements and achieves the desired results identified by the legislature.

Requirements in the law should be realistic if they are to be taken seriously, so HB 194 changes the Governor’s budget submission deadline for a newly elected governor from December 15 to January 15 and requires the Governor’s budget to include projections for three succeeding fiscal years rather than ten succeeding years.

HB 194 adds a new section of the Executive Budget Act to require the Governor to submit alternative budget plans for the next fiscal year, and projections for the next three succeeding fiscal years, based on both the average price of crude oil for the past ten years and $70 price per barrel for Alaska crude oil.

HB 194 adds a new section of law that creates a consensus estimating process. Consensus estimating conferences are created in the legislature for economic and demographic forecasts, revenue estimates, and expenditure estimates for education, criminal justice, social services, and retirement costs. Conferences produce “official information” that must be used for the budget. Requires the proposed expenditures in the budget not to exceed official estimated revenues for the succeeding fiscal year. Additionally, operating expenditures may not exceed official estimates of recurring revenue.

HB 194 adds special impact estimating conferences that can be requested by the Speaker of the House or the President of the Senate to evaluate a legislative proposal. The “official information” from a special impact conference will serve as a fiscal note.

HB 194 requires state agencies to report semi-annually the results of the measures set by the legislature and achievement of program, service, and financial goals.