Dunleavy, 050819 AKAGO, AGO FY20

Docket Nº:AGO FY20
Case Date:May 08, 2019
The Honorable Michael J. Dunleavy
No. FY20
Alaska Attorney General Opinion
May 8, 2019
         The Honorable Michael J. Dunleavy          Governor          State of Alaska          P.O. Box 110001          Juneau, AK 99811-0001          Re: FY20 Education appropriation          Dear Governor Dunleavy:          You have asked for a legal opinion on whether an appropriation of future revenues for K-12 education spending for fiscal year 2020 included in an appropriation bill enacted in 2018 was consistent with the requirements of article IX of the Alaska Constitution.          I. SUMMARY AND SHORT ANSWER          It is the opinion of the Department of Law that the appropriation is unconstitutional because it contravenes the annual budgeting process required by the Alaska Constitution and it is an improper dedication of funds. Over 25 years ago, the Alaska Supreme Court held that the Alaska Constitution mandates an annual budgeting process—"the constitutional framers believed that the legislature would be required to decide funding priorities annually on the merits of the various proposals presented."1 Less than two years ago the Court again emphasized this annual budgeting process in the legal dispute over whether the permanent fund dividend must be appropriated each year—"[a]bsent another constitutional amendment, the Permanent Fund dividend program must compete for annual legislative funding just as other state programs."2 As detailed below, we believe last year's appropriation for FY20 K-12 education spending improperly binds a future legislature and future governor in contravention of the annual budgeting process and violates the constitutional prohibition against dedicating state revenues. Absent an appropriation for FY20 K-12 education in the budget bills passed this legislative session, the only appropriation for education will be one that is unconstitutional in the view of the Department of Law.          II. DETAILED ANALYSIS          A. The FY20 operating budget and education spending.          The FY19 operating budget bill included an appropriation for education spending in FY20.3 Although the legislature’s action in this regard has been referred to as “future funding,” the more appropriate description of the legislature’s action is “future appropriating.”4 In essence, in FY19 the legislature future appropriated future FY20 revenue for education in FY20. The three FY20 operating budget submissions (November 30, December 15, and February 15) all included a proposed appropriation for FY20 K-12 spending as well. The legislature, however, did not include these appropriations in the versions of the operating budget recently passed by each house.5 Although the legislature has the opportunity to include an appropriation for FY20 K-12 spending in other appropriation bills pending in the legislature, it has not done so as of the time of this opinion.          B. An annual budget has been the norm and Alaska law recognizes an annual budget process.          The Alaska Constitution, court decisions, and historical practice demonstrate that Alaska has a well-established annual budgeting model. The Alaska Constitution mandates that the governor submit a budget “for the next fiscal year” that sets forth “all proposed expenditures and anticipated income of all departments, offices, and agencies of the State.”6 The legislature, in turn, has the responsibility to determine how much to spend and on what, and to pass appropriations bills authorizing that spending.7          The Alaska Supreme Court at various times has described an annual budget process in which legislators consider the competing demands for state funding. For example, the Court has stated that the legislature and the governor have a “joint responsibility . . . to determine the State’s spending priorities on an annual basis.”8 The Court, in its recent Permanent Fund dividend decision, pointed out that “[a]bsent another...

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