Payroll taxes, pensions, oil revenues
Gov. Sean Parnell, wearing a cheerful maroon sweater, spoke to a standing room only audience at the Chugiak-Eagle River Chamber of Commerce luncheon Dec. 18 at Bear Mountain Grill.
He opened with good news.
“The unemployment insurance trust funds are solvent, so your taxes are going down as employers and employees to the tune of around $90 million,” he said, to applause.
He continued with reports on the economy.
“The track we’re on is a good one,” he said.
He mentioned next year’s budget, which will be based on lower revenues due to declining oil prices.
“The naysayers on SB 21 were quick to say, ‘See, we told you so. We told you the newer tax reform would result in lower revenue,’” he said.
Yet, he added, we’re seeing the benefit of new investments plus better protection of Alaska’s treasury.
He moved on to the unfunded pension liability.
“It’s not a sexy topic,” he said.
The state’s pension systems were changed in 2006, yet almost $12 billion is still owed on those systems. Annual payment on that debt continues to escalate, he said, and this year’s operating budget contained a payment of $630 million.
“Every year we wait, we spend more and squeeze the budget more,” he said.
He suggested taking $3 billion from the state’s savings and paying down the debt, resulting in fixed payments of around $500 million for the next 25 years.
“We will realize real savings, real quick,” he said.
Parnell answered questions from community and chamber members, touching on topics such as distance education, Alaska Performance Scholarships and educational core standards.
Then someone asked a biggie: A question on Parnell’s decision to not accept federal Medicaid expansion.
“The allegation is that there are 43,000 individual who don’t have health care because they have no coverage,” he said. “Yet, the more I dug into that initial conclusion, the more I found out how false it is.”
According to Parnell, about 17,500 of those numbered as uninsured are eligible under Alaska Tribal Health System.
“I began to dig deeper and realized we pay tax dollars for community health centers,” he said. “Our kids are going into debt for that already.”
The expansion, he said, would offer relief for the healthcare system but not for “people like us” who were losing health insurance and paying higher health insurance premiums.
Parnell said he’s working to address gaps between primary and emergency care.
“This is not a bumper sticker,” he added.
The mood lightened with a question on the gas pipeline status.
“I’m cautiously optimistic that you’ll see progress forward,” he said. “It’s pretty exciting.”
The luncheon ended with everyone, including Parnell, belting out a rather off-key but still very joyous rendition of “Jingle Bells.”
Contact Cinthia Ritchie at 694-2727 or email@example.com.