Alaska budget fiscal year 2025 announced: Priorities and vetoes

Governor Mike Dunleavy signed the fiscal year 2025 budget on June 28, according to his press release — just in time for Alaska’s new fiscal year starting on July 1.

The total operating budget is approximately $12.2 billion. The capital budget is $3.5 billion. 

From what the legislature approved, this year’s operating budget was reduced by $105.7 million and the capital budget was reduced by $126.3 million because of line-item vetoes, according to the press release.

The Permanent Fund Dividend for Alaska residents was announced as $1,718 for 2024. This is a decrease from the proposed $2,270 in April according to an article by the Alaska Beacon.

Budget priorities for the year outlined in Dunleavy’s press release are education, energy, affordable housing and public safety.

K-12 as well as the university system received an increase in funding from the last fiscal year. These include $174.6 million for one-time increases of $680 to base student allocation per student and $7.3 million for student transportation.

According to a statement by University of Alaska president Pat Pitney, the University of Alaska was allotted $331.3 million from state funding and $934.5 million for its total operating budget. The University of Alaska’s operating budget is $22.9 million more than last year’s budget from the state.

The energy related projects emphasized in the press release were $10.5 million for the Renewable Energy Grant Fund, $23 million for Alaska Housing Finance Corporation Energy Efficiency Research and Energy Weatherization, and $11.1 million to University of Alaska Fairbanks’ Alaska Railbelt Carbon Capture & Sequestration Project. 

Affordable housing and the lack thereof has been a topic of much discussion in Anchorage. To help address the issue, the budget included $53.2 million to the Alaska Housing Finance Corporation. Alaska Addiction Rehabilitation Services received $2.8 million for residential expansion and the Denali Commission received $1.5 million. 

For public safety, $9.5 million was allocated for a replacement “patrol vessel for southeast Alaska;” $3.5 million for a village public safety officer; and $700,000 for education and research into missing and murdered indigenous people. 

The state has continued to see cases of missing and murdered indigenous people, according to an article by the Alaska Beacon.

Another large section of the operating budget is dedicated to state Department of Health services, with $35.7 million for behavioral health, $23.7 million for healthcare services, and $141.2 for public health.

As large parts of the state’s economy, $88.6 million was set aside for commercial fisheries and $5 million for tourism marketing.

When it comes to environmental services, the operating budget includes about $29.3 million for environmental health, about $15 million for air quality, about $23.9 million for spill prevention and response and about $30.3 million for water quality.

In the budget process, many of the requests for funding were vetoed to lower amounts. 

The University of Alaska’s requested $20 million for UAF’s research program were vetoed by $5.4 million, slowing their efforts to become a Tier 1 research university.

According to an article in the Anchorage Daily News, Dunleavy vetoed $500,000 of the requested $2 million for the Blood Bank of Alaska’s in-state donor testing lab.

According to the press release Dunleavy’s office gave regarding the budget,“The vetoes in the FY2025 budget resulted from a thorough evaluation and consistent application of the priorities of the Dunleavy Administration to grow savings and ensure fiscal stability.”

According to an article in the Alaska Beacon, “If the state spends less than it raises, that money will be deposited into the Constitutional Budget Reserve, a fund that was depleted over the past decade to balance the budget.”