April 6, 2026

This week the House begins floor debate on Alaska’s FY27 operating budget (HB 263), which funds state government from July 1, 2026 through June 30, 2027. The budget we’ll be working on passed the House Finance committee last week and you can review the bill and successful amendments from the link below.

Alaska is managing roughly $15 billion this year—an extraordinary level of public investment—so even as we have tough budget debates to work through, I’m reminding myself and everyone impacted by the process, we should start from a place of opportunity and responsibility, remembering how much good this funding does for Alaskans, our businesses, and our future, and focus on using it wisely rather than framing it only as scarcity and conflict.

That said:

Like all budgets, it has two parts:
“Numbers” — what we fund (agencies, programs, services)
“Language” — how funds are used (transfers, reserves, dividends, and other directives)

You can review it here: https://www.akleg.gov/basis/Bill/Detail/34?Root=HB%20263#tab5_4

As we head into House action, expected to take about three days of long floor sessions before sending the budget to the Senate—I’m focused on three core principles:

1. Fund education responsibly
   At a minimum, provide one-time funding to keep up with inflation and maintain stability for our public schools—including local neighborhood schools and more than 60 charter and home/correspondence programs. My preference, however, is for more durable solutions, such as a BSA adjustment (HB 374) and/or stabilizing student counts (HB 261), along with funding for school bond debt reimbursement and critical maintenance.
2. Fully Fund FY27 Planned Expenses – No-surprises budgeting—and no mess for the next Governor
   Fully fund known, predictable costs (5 year average/trend or less!) —fire suppression, disasters, health obligations, benefits, and labor contracts—so we don’t pass an incomplete budget and return next winter for a large supplemental savings draw. Fund critical capital projects and necessary federal match funds.
3. Balance the budget and protect savings
   Use current one-time oil revenue responsibly. That means a balanced budget with a surplus set aside for volatility, fiscal notes on bills we’ve passed, future supplementals, and a responsible transition to the next administration. Target ~3% of UGF or about $200M. It also means being realistic about upcoming obligations such as SNAP/Medicaid and potential pipeline support, where we may not yet fully understand the total cost of one of the largest infrastructure projects in North America.

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There’s more we should be doing—but only when we’re willing to pay for it. We’ve exhausted over $20,000,0000,000 in savings while we avoided being fiscally responsible, enough that it would be generating $1,000,000,000 every year forever in a POMV account. It’s time we wake up from dreams and empty promises, and start being the responsible owner-state we were created to be.

Alaska needs long-term investments in a stronger economy, lower-cost systems, and smarter prevention that reduces further costs. Until we address our revenue gap, the priority must be discipline, stability, and getting the fundamentals right.

Ky