Budget bills are signed by Walker, but he vetoes the Knik Arm Crossing and a vitamin D study

 Gov. Bill Walker signs Alaska's FY19 budget into law, June 13, 2018. (KTUU)
Gov. Bill Walker signs Alaska's FY19 budget into law, June 13, 2018. (KTUU) (KTUU)
Published: Jun. 13, 2018 at 2:08 PM AKDT
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Gov. Bill Walker used his line item veto to kill off a $2.5 million appropriation for the Knik Arm Crossing and a $500,000 vitamin D study promoted by Rep. Paul Seaton, a Homer Republican who has insisted sun-starved Alaskans could benefit from ingesting the vitamin.

The $2.5 million from the bridge project will return to the general fund from the capital budget. It would have allowed the project to reawaken from the dead after Walker had killed off the project in prior years, but would not come close to paying its billion-dollar price tag, Walker said.

On May 8, the Alaska Senate approved $4.5 million for the bridge, but the final capital budget, a product of the House Finance Committee, listed $2.5 million for it.

In any event, now it’s zero.

The vitamin D study, in the operating budget, might be redundant — a study of the vitamin is already underway in the Yukon-Kuskowim area, said budget director Pat Pitney. If that study shows more research is needed, Seaton’s proposed statewide study can be put in a future budget, she said.

Walker signed the budget bills and Senate Bill 26, a bill that provides for a fixed 5.25 percent draw from the Permanent Fund earnings reserve for the next three years, in a lunchtime ceremony Wednesday. The ceremony took place in the Alaska Native Science & Engineering Program building at the University of Alaska Anchorage. Walker said he chose the venue because education funding was a key component of the budget bill and because of the link between the young students at ANSEP and the future of the Alaska Permanent Fund, which he says is assured by the limited draws in SB 26.

Walker noted that the operating budget was 2 percent higher than the one he submitted to the Legislature in December. But Walker said he was fine with the additions, since they paid for more education, public safety and a $1,600 Permanent Fund dividend, larger than he originally contemplated.

“I support those increases and I certainly will not be making any veto adjustments to any of those,” Walker said.

As if to make that point, his office forwarded a June 8 statement from the bond rating agency Standard and Poors, which said SB 26 and its use of “the state’s vast Permanent Fund earnings” for government caused it to change its outlook for Alaska from “negative” to “stable.” While the S&P outlook doesn’t change the cost of borrowing for the state, it could be a sign that credit agencies see improvements.

“The outlook revision is the first significant, positive news from one of the major credit rating agencies since Alaska’s fiscal crisis began in 2014,” the governor’s office said in a prepared statement. “S&P, Moody’s, and Fitch Group all downgraded Alaska’s credit in response to gridlock over how to solve to a budget deficit that peaked at $3.7 billion after oil prices plummeted.”

“Our fiscal woes are behind us,” Walker said at the budget bill signing.

In addition to the students, a handful of members of Walker’s cabinet were present along with opponents of the Knik Arm bridge. The opponents said they weren’t told about the veto, but guessed it was coming based upon their invitations.

Are they happy?

“Of course we are,” said Government Hill resident Stephanie Kesler, a former community council president who lives on a knoll that would be above the bridge and its eastern access. “I think the governor did the right thing.”

Walker vetoed two other items in the budget, but he and budget director Pitney said they were technical in nature and would have no practical effect.

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