For Immediate Release
Contact: Cassandra Stalzer, 907-334-0520
Anchorage, AK – The majority of Alaskans believe the state cannot cut its way out of a $3.5 billion revenue shortfall, and that new revenue must be part of the solution, according to a poll released today by Rasmuson Foundation.
The “Alaska Attitudes on the State Fiscal Climate” survey also reveals that tapping the excess earnings of the Permanent Fund and capping the amount of the annual dividend were the most popular revenue options.
And while Alaskans want to see more efficiencies in the state budget, by a 2 to 1 margin, they would rather pay sales or income tax than experience deep cuts to essential public services.
Rasmuson Foundation has spent the past two weeks sharing the results of the poll with the Governor and legislators prior to its public release today.
“These results show that Alaskans are ready to have the difficult deliberations about the sustainability of our state,” said Rasmuson Foundation Chair Ed Rasmuson. “And now our elected leaders need to lead. The Governor and Legislature have the unenviable responsibility to make decisions that are going to be unpleasant, but necessary.
“If we rely on oil to fund 85 percent of the state’s budget, we are three years away from a financial cliff that threatens our very standard of living. Even if oil prices move back toward $100 per barrel, and right now prices are less than half that, by the end of 2019 the state will be broke. We need common sense solutions and bipartisan leadership to put our state back on the path of fiscal sustainability,” said Rasmuson.
The “Alaska Attitudes on the State Fiscal Climate” survey examined voter opinion about the budget shortfall facing Alaska. The poll was commissioned as part of the Foundation’s effort to engage and educate the public about the state budget and the need for a balanced and sustainable fiscal plan.
“For the past 60 years, Rasmuson Foundation has invested more than $250 million to improve the quality of life in our state,” said Rasmuson Foundation President Diane Kaplan. “If we don’t find an acceptable solution, and quickly, we could see much of that improvement erode.
“This survey shows the majority of Alaskans want to use all the tools we have to close this gap. And current economic conditions show that we can’t wait until next year to get started,” said Kaplan.
The poll examined public opinion on the fiscal deficit and solutions to help stabilize the state budget including budget cuts, a broad-based tax, sensible use of excess Permanent Fund earnings, a cap on yearly permanent fund dividends, and a fine-tuning of oil production tax credits.
The poll was conducted by Strategies 360 and interviewed 1,206 registered voters in Alaska and carries a margin of error of +/-2.8%. Interviews were conducted July 13 – 21, 2015. It found:
• Nearly 90 percent of voters know about the budget shortfall facing the state with a majority of those polled ‘extremely’ to ‘fairly’ concerned about the shortfall.
• A majority of voters would prefer to see new revenue included as part of any solution to address the budget shortfall.
• Just 25 percent of residents believe that the state’s budget shortfall should be solved ‘only’ or ‘mostly’ through spending cuts.
• 61 percent of voters believe that the state’s economy would be negatively impacted if the state only relied on savings and spending cuts and did not raise new revenue to address the shortfall.
In order to help close the budget shortfall, voters said they would be willing to support a number of revenue proposals, including:
• Introducing a statewide sales tax.
• Putting a cap on the yearly amount of Permanent Fund dividends
• Using a portion of excess earnings from the Permanent Fund to fund public services and programs
• Reducing oil development tax credits offered by the state
The full poll, which includes additional questions and findings, is attached.
Dependent on tax revenue from the oil industry, which has been declining, Alaska currently faces a budget shortfall of about $3.5 billion annually. To make up this shortfall and to cover spending needs, Alaska has been relying on reserve funds since 2013 – accounting for more than $13 billion. At this rate, state reserves will be depleted by 2020.
To help address Alaska’s fiscal deficit, Foundation Chairman Ed Rasmuson convened a group of respected individuals in May to develop recommendations to members of Governor Walker’s transition team calling elected officials to adopt a long-term state fiscal plan.
As part of this effort, the Foundation announced that it would launch a statewide effort to talk with Alaskans, to share facts and options and to explain the urgency of the state’s fiscal situation.
About the Foundation
The Rasmuson Foundation was created in May 1955 by Jenny Rasmuson to honor her late husband E.A. Rasmuson. The Foundation is a catalyst to promote a better life for all Alaskans.