Looking out for business ...: a report from the Alaska State Chamber of Commerce--the voice of Alaska business.
Alaska's fiscal gap could be almost $1 billion in 2006 and could more than double that by 2014 according to recent Legislative Finance projections. If so, this means that the fiscal gap Alaska faces will likely be a lot bigger than most people think. It also means we must not wait any longer to face this issue head on. Now is the time for the Legislature to develop a balanced, comprehensive, long-range fiscal plan for the state.
The recent Conference of Alaskans identified various solutions to our current situation. Although many different approaches are being debated, the Alaska State Chamber of Commerce (ASCC) believes Alaskans are unified in their assessment of the problem. Everyday more and more Alaskans are coming to understand the negative effect fiscal uncertainty is having on Alaska's quality of life, investment climate, economy and job market. Despite the temporary good fortune of higher than expected oil prices, decisive action must be taken now.
We understand that decisions regarding different source of revenue will be both practically and politically difficult to make. ASCC feels that following the general steps, as prioritized below, will lead to a fiscal plan that will make the most sense for Alaska:
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Budget Discipline: Alaska must adjust to the reality of lower revenues just as a family or business would ... by controlling spending. Reasonable spending controls should be incorporated into any long-lerm fiscal plan. We are concerned that if revenues are made available first by imposing new taxes, fiscal discipline could be compromised. Fiscal discipline should be maintained as the cornerstone of fiscal plan.
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New Uses of Permanent Fund Earnings: ASCC believes appropriating a portion of the earnings from the Permanent Fund to help support state...
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