State Government

Gov. Mike Dunleavy’s fiscal plan is taking a beating as lawmakers and the public take a closer look at the proposal. Last week, dozens of Alaskans called into a hearing to voice their particular displeasure with the governor’s proposal to institute a statewide sales tax.

Now, the governor is changing course a bit. In an interview with Alaska Public Media on Friday, Dunleavy offered to put the tax plan on ice for now.

“Let’s all agree. Take more time on the taxes. I’m all in on that,” Dunleavy said. “Let’s get the first several components in law and a constitutional amendment sent out to the people of Alaska.”

In the interview, Dunleavy defended his tax plan, which would hike some oil and gas taxes, modernize corporate income taxes, and, most prominently, create a statewide sales tax of 4% in the summer and 2% in the winter. All of the changes would be temporary, set to automatically repeal in the 2030s, and corporate income taxes would vanish entirely in 2031.

The sales tax would be by far the largest revenue-raiser, bringing in $700 to $800 million annually.

Dunleavy pitched it as an effort to extract more revenue from people who live outside of Alaska. When a panel of economists from the University of Alaska Anchorage’s Institute for Social and Economic Research looked at the options the state has, they found a sales tax, especially one with a higher rate in the summer, would bring in a greater share of its revenue from nonresidents than other options, like an income tax.

The governor also argued that a sales tax would be countercyclical. When gas prices are low, and state oil income is correspondingly low, people might be more willing to travel and spend money in Alaska, he said, pointing to Texas and Saudi Arabia as examples.

“It stabilizes the ups and downs of oil, and so it stabilizes your fiscals,” Dunleavy said. “That’s what this is about.”

But House Speaker Bryce Edgmon, an independent from Dillingham, said it was clear from public testimony that Alaskans were not prepared to pay a sales tax.

“You cannot do broad-based taxes or any significant measures without, No. 1, having the general public somewhat in alignment,” he said at a news conference on Friday.

Without Dunleavy’s tax bill, what’s left in the governor’s fiscal plan?

Whether a willingness to delay tax changes will make the rest of the plan more palatable, however, is uncertain.

The tax bill, filed as House Bill 284 and Senate Bill 227, is by far the most controversial part of Dunleavy’s fiscal plan, but even without it, the remaining elements still face skepticism from leading lawmakers in the state House and Senate.

Those include:

• Capping the growth of state spending at 1% each year, not adjusted for inflation (House Bill 275 and Senate Bill 223)
• Tasking a legislative committee with performing “sunset reviews,” evaluating government agencies every six years and requiring a vote on whether to continue or end the agency’s work (House Bill 274 and Senate Bill 222)
• A multipronged constitutional amendment related to the Permanent Fund, which would combine its two accounts into one, cap the annual draw at 5% and set aside half of that 5% draw for dividends (House Joint Resolution 30 and Senate Joint Resolution 23)

Dunleavy argued that passing those measures would build trust with voters — and potential taxpayers — that tax money would be spent responsibly.

“Once you put in rules to control the spending,” he said, “the spending, if you need it, will then make sense to Alaskans, and it can be controlled.”

He cast the final year of his term as the last chance to get those sorts of measures into state law and the Constitution, even challenging this reporter to a $500 bet that the measures would not pass once Dunleavy left office. (This reporter is not allowed to bet on the news and declined the bet.)

Does any of it stand a chance of passing?

House Speaker Bryce Edgmon said in an interview that he was willing to negotiate with the governor’s team but expressed skepticism about the remaining elements of the plan, including the limit on government spending. Inflation in recent years has run above 2%, and costs in rural communities disconnected from the road system have risen even faster, Edgmon said.

“We have so many needs on the operating side of the budget, the capital side of the budget, that to limit to a 1% increase going forward into time, assuming we continue to grow as a state, bring more residents in that make everything more expensive, that seems unrealistic,” Edgmon said.

Some minority Republicans are also skeptical — House Minority Leader DeLena Johnson, a Palmer Republican, told the Alaska Beacon the measure didn’t go far enough, calling it a “spending beanie” that could easily be overcome with a majority vote and the consent of a future governor.

Another minority Republican, Fairbanks Rep. Will Stapp, said the constitutional amendment setting aside half of the state’s investment income for dividends would be unsustainable, even if the tax plan passed. Dunleavy’s proposal, if it were in effect next fiscal year, would dedicate $2 billion in otherwise unrestricted state funds to dividends.

“I fail to see how enshrining a liability that outstrips the amount of revenue I’m raising in taxation creates anything but more instability and a need for more taxes,” Stapp said at a House Finance Committee meeting on Thursday.

Key senators have also balked at the idea of placing the dividend in the state Constitution, including Sitka Republican Sen. Bert Stedman, who co-chairs the Senate Finance Committee, though Senate President Gary Stevens, Republican of Kodiak, said he believed there was room to negotiate with Dunleavy on the amendment.

In response, Dunleavy fired back at Stapp.

“Representative Stapp is the liability,” Dunleavy said, “because he wants to spend the people’s PFD.”

Dunleavy said the amendment was an effort to prevent lawmakers from balancing the budget by reducing dividends, as lawmakers have for approximately the past decade. That’s akin to a regressive tax, hitting low-income earners the hardest, according to the economists’ presentation.

“It should always be more difficult,” Dunleavy said. “If not, you’re going to end up with what we’ve had here over the decades, spending every single penny we can find.”

Despite their opposition to Dunleavy’s plan, lawmakers do not appear ready to counter the governor’s proposal with one of their own.

For now, Edgmon said he hoped this year’s debates would at least help Alaskans understand that, with dwindling savings and uncertain revenue, why taxes might be necessary to balance the state’s budget in the long term.

“The one message that we hope will emerge from all this is that, look, Alaska, we have a structural deficit,” Edgmon said. “We need new revenues. And so that conversation, I think, is going to be really valuable.”

Leading members of the Alaska House of Representatives said Friday that Gov. Mike Dunleavy’s ambitious long-term state fiscal plan has almost no support among legislators and is almost certainly dead on arrival.

House leaders spoke with reporters Friday morning, a day after members of the House Finance Committee heard two hours of public testimony on the governor’s proposed statewide sales tax, the cornerstone of his multi-part proposal to bring state expenses and revenue into line over the next five years.

Every Alaskan who testified — almost 30 in total — was against the tax.

“This is just pure speculation on my part, but what you hear folks in the hall say is, if there’s a vote today on the sales tax, it could be a zero to 60 vote,” said Rep. Neal Foster, D-Nome and co-chair of the House Finance Committee.

House Minority Leader DeLena Johnson, R-Palmer, said there might be a handful of legislators who would still support the governor’s plan, but it’s pretty clear that it lacks the support it needs to become law.

“From the testimony that was taken last night in House Finance — when everyone who called in spoke in opposition — it certainly makes it hard to think there’s a lot of people that aren’t very cautious about saying they’re for the governor’s plan,” she said.

The governor’s plan calls for a seasonal statewide sales tax, changes to the state’s oil and corporate taxes, a constitutionally guaranteed Permanent Fund dividend formula, changes to the structure of the Alaska Permanent Fund and a tighter spending cap in state law.

Those changes are being proposed because oil and investment revenue can’t keep up with demand for services and dividends, and lawmakers are unwilling to cut services any more than they already have.

Since 2015, legislators and governors have cut state agencies’ budgets by 16.6%, after accounting for inflation. The state’s capital budget, which pays for new construction and maintenance, has been cut by more than 80%.

Every year since 2016, the Permanent Fund dividend has been cut below the amount called for in state law.

With so much deferred maintenance, public schools — particularly in rural Alaska — are decaying and literally collapsing. The state is now facing a lawsuit alleging that school funding is so low that it violates the Alaska Constitution.

Dunleavy’s proposal would be a way to stanch the fiscal bleeding. The new taxes are intended to be temporary because the Dunleavy administration expects North Slope oil production to rise, boosting state revenue, and it expects that a proposed trans-Alaska natural gas pipeline will be built and generate more money for the state.

Even before this week’s presentations and public testimony, many legislators were skeptical of the plan, and saw the new taxes as merely a way to pay a larger Permanent Fund dividend.

“I’m a logic person,” said Senate Minority Leader Mike Cronk, R-Tok, on Jan. 28, one day after the governor debuted his plan.“We’re going to tax those people that are productive so everybody gets a check? That don’t work for me. … That’s just not logical to me,” he said.

Lawmakers analyzed the sales tax first, in a series of hearings this week, but because it received such a negative reaction in public testimony, legislators are now wondering if it’s worth considering any other part of the governor’s fiscal plan, given that they are all viewed as one package.

Foster said it doesn’t look like the governor’s proposal could be amended and improved enough to get sufficient support in the Capitol.

“Sometimes, you could say, ‘We’re kind of close on things, and there’s a lot of great areas that we can work on,’ but this one just seems to be — folks are just really, really unhappy,” he said.

There are costs to inaction as well. The Institute of Social and Economic Research recently estimated that the state has missed out on 2-3% of its gross domestic product over the past 10 years because of the lack of a fiscal plan. Without a long-term structure, legislators have gotten dragged into annual debates over the size of the Permanent Fund dividend, which has prevented them from discussing other pressing issues.

Some lawmakers have concerns beyond the sales tax. Johnson thinks the governor’s proposal for a revised fiscal cap is inadequate. Because it would be in state law, rather than in the constitution, future legislators could ignore it just as they do the current Permanent Fund dividend formula.

That’s why she calls it a “spending beanie,” instead of a spending cap.

“I personally think it’s rather small, and it would be easily overcome,” she said. “And for that reason, I think of it as a spending beanie.”

Speaker of the House Bryce Edgmon, I-Dillingham, said he’s skeptical of this proposal’s chances after years of other attempts to enact a fiscal plan.

“I won’t regale you with tales from years past, but on the Finance Committee, we have spent weeks and weeks going through a lot of this stuff, and it never got a compromise when it came to the floor. So that’s the issue at hand here,” he said.

Rep. Calvin Schrage, I-Anchorage and another Finance co-chair, said that after hearing Thursday’s public testimony, he’s not sure the governor’s proposal can be successful either. “There is so much education that still needs to take place and studying that needs to be done for us to be able to move it forward in a way that would get broad support,” he said.

“I think folks are just kind of waiting until next year before we, you know, really take a serious stab at some of those things, like the income tax,” Foster said.

“I have higher hopes for next year than I do this year. You know, a new executive leadership branch and the leadership there,” he said.

Later in the day, in a one-on-one interview with the Alaska Beacon, Dunleavy said lawmakers are going to be disappointed if they think that negotiating with a new governor will be any easier.

Dunleavy is term-limited and leaves office in December.

“A governor who goes in there and puts out a plan like this in their first or second year, they’re going to get the same thing we’re getting now,” Dunleavy said. “And that doesn’t work.”

When an Alaskan flies to Seattle and looks out the airplane window, they’ll see construction cranes dotting the skyline, Dunleavy said.

“Washington is a state that does not have an income tax. It’s a sales tax. Washington’s economy is actually pretty good,” he said.

He referred to a fiscal analysis performed by the Institute of Social and Economic Research at the University of Alaska Anchorage, which found that a seasonal sales tax with large exemptions would fall more on nonresidents than an income tax would.

“The sales tax is the best thing we could come up with,” he said, referring to that analysis.

Reducing the PFD to balance the budget — the Legislature’s preferred policy since 2016 — is the most regressive option, harming poor Alaskans more than rich ones, ISER found.

“Taking the PFD is the worst thing you can do for the average person,” Dunleavy said.

He appeared frustrated by legislators’ actions and the lack of an alternative plan coming from the House or Senate.

“I’ve never seen a fiscal plan introduced,” Dunleavy said. “The closest I’ve ever seen was the first fiscal working group just a couple years ago.”

In 2017, the Alaska House of Representatives approved a state income tax as part of a three-part fiscal plan, but it did not become law.

The state Senate, including Dunleavy, voted down the income tax, killing the House’s plan.

“A tax is not a fiscal plan,” Dunleavy said when asked about that history.

He said that with 120 days in the legislative session, lawmakers have time to work on the issue and figure things out.

“Here you go: My last year, there’s no political skin in the game. I’m not going to lose anything because I’m not running for anything. And here’s an opportunity for these guys, and out of the gate, they said, ‘There’s not enough time.’ So if there’s not enough time for this,” Dunleavy said, “What are they spending their time on?”

The number of out-of-state workers in Alaska is continuing to rise and is near an all-time high, according to a new report published this week by the Alaska Department of Labor and Workforce Development.

In 2024, almost 23% of non-federal jobs in Alaska were held by someone who did not live in the state. Nonresidents earned roughly $3.8 billion, or about 17% of every dollar earned from a non-federal job.

In some industries, the proportion of nonresident workers was much higher:

Among oil and gas workers, 40.5% were nonresidents. Among miners, nonresidents made up 44.2% of all workers, and nonresidents averaged higher wages than residents did.

The state has been collecting nonresident worker data since 1990, and the new figures are the second-highest on record, behind only 1992, which used a different job classification system. That year, 23.7% of Alaska workers were nonresidents.

The proportion of nonresident workers has been rising steadily since the COVID-19 pandemic emergency layoffs of 2020.

Rob Krieger, an economist with the Department of Labor, wrote about the new report in an article for this month’s Alaska Trends magazine.

He noted that the rise comes amid a decline in the number of Alaskans who are between 18 and 64 years old, what economists call “prime working age.”

From 2013 to 2024, the number of Alaskans in that age range has declined by about 34,000 people, or 7%.

During that stretch, more people have moved out of the state than have moved in, and the state’s average age has risen steadily, leading to more deaths and fewer births.

“It’s pretty clear that is kind of what’s contributing to what we’re seeing with employers having to rely heavily on nonresidents,” he said.

“Every industry now is starting to lean more heavily on nonresidents, including ones that have historically not. Even things like state government and local government, we’re starting to see more nonresidents,” Krieger said.

In most industries, nonresidents earned less than residents did because nonresidents tended to hold seasonal jobs.

Across the state, nonresidents averaged $16,302 in wages for any given quarter of the year. Residents averaged $16,531, indicating that nonresidents and residents were generally paid about the same.

Gunnar Schultz, a Department of Labor analyst who compiled this year’s report, said the numbers are based on unemployment insurance reports filed by employers with the state. Alaska requires employers and employees to pay into the state’s unemployment insurance fund.

Those numbers are then contrasted with Permanent Fund dividend applications.

“Did you apply for a 2024 PFD or 2025 PFD? If you applied for neither, you’re a nonresident,” he said.

Alaska had almost 15,500 federal workers in 2024; those aren’t included in the report, nor are members of the military and self-employed Alaskans.

That last category includes many commercial fishermen.

The report separately analyzed those jobs, and based on permit data and other information, “nonresidents were an estimated 49 percent of the harvesting workforce, which includes permit holders and their crew, and nonresidents took in 57 percent of gross harvesting earnings.”

If you ask Gov. Mike Dunleavy, a lot of the state’s problems come back to the budget process.

Every year, lawmakers gather in Juneau for four months and spend much of that time debating how the state should spread around its limited funds: how much for education, how much for public safety, and for the last decade or so, how much the Permanent Fund dividend should be.

Meanwhile, much of the state’s revenue depends on the constantly swinging price of oil. Dunleavy says investors who might otherwise bring jobs and new residents to the state have noticed.

“We know that this volatile budgetary process has negatively impacted our ability to recruit investment to the state. It has retarded our GDP growth. It has caused deep fractures within this body and within other relationships, and it leads to uncertainty in funding for critical programs,” Dunleavy told lawmakers and Alaskans in his State of the State speech.

In the days after his speech, Dunleavy filed a series of bills outlining a fiscal plan that he believes would make the budget more stable by boosting revenue and cutting expenses.

It’s a problem Alaska has wrestled with for years: the state spends more than it takes in. Since oil prices crashed in the mid-2010s, Alaska has drawn down billions from its savings accounts, cut government spending and reduced residents’ Permanent Fund dividends in an effort to ensure schools, state troopers, highways, ferries and fish and game management are funded.

Most of the money Dunleavy’s multifaceted plan would raise would come from a sales tax — 4% in the summer, 2% in the winter. The plan would also hike oil taxes, add a new per-barrel surcharge for pipeline corridor maintenance, and capture more money from Outside businesses. It would all be temporary, roughly five to seven years — and in 2031, corporate income taxes would vanish entirely.

On the expense side, it would put a 1% cap on state spending growth every year. That’s not adjusted for inflation. So if inflation runs more than 1%, state spending shrinks. (For reference, the Federal Reserve targets 2% inflation each year; in 2025, inflation was 2.7%, according to the Bureau of Labor Statistics.)

An additional check on expenses in Dunleavy’s plan is what’s known as a sunset review — lawmakers would periodically have to vote to reauthorize various pieces of government.

Dunleavy’s plan would also take Permanent Fund dividends out of the state’s annual budget debates by putting it — and a new formula — into the state Constitution.

“At no point do any of these things add up to get to a balanced budget,” said Neil Steininger, a former Dunleavy budget director who crunched the numbers for the Alaska Political Report, a subscription newsletter.

For one thing, Dunleavy’s plan would fully drain the state’s $3 billion rainy day fund by the end of the 2033 fiscal year, according to Steininger’s analysis — not exactly resolving the state’s budget issues.

For another, Steininger said, the effect of the changes would ultimately make the state’s revenue just as volatile, if not more — exactly what Dunleavy is trying to avoid.

That’s a result of Dunleavy’s proposed formula for dividends, which would take half of the state’s annual draw from the Permanent Fund and split it 50-50 between state services and dividends.

The fact that so much “stable, reliable” investment revenue would be tied to dividends would make the state more dependent on the price of oil, Steininger said.

“That’s a position we’ve been in already,” Steininger said. “That’s actually nothing new. It’s just really cementing that into the Constitution.”

The governor has not held a news conference or granted interviews to discuss his plan since the bills were released, but his office’s projections are substantially rosier.

An updated 10-year plan from his Office of Management and Budget shows a surplus in the early 2030s, peaking at roughly $300 million, before returning to large deficits in the 2035 fiscal year. But the governor’s office still projects the plan would draw down half of the rainy-day fund over 10 years, including a $1.4 billion withdrawal in the coming year.

Dunleavy has argued revenue from things like a boom in oil drilling or a new gas pipeline would help the budget balance in the long term.

“We’re going to be going into what I believe is going to be a more revenue-prosperous era,” he said at a Cabinet meeting before the plan was released.

But that future revenue is speculative, and thus doesn’t show up in state economists’ “cold and sober” revenue projections that lawmakers build the state’s budget around, Steininger said.

“Part of it is because a lot of that stuff will take a long time before it impacts state revenue,” Steininger said. “Even though 10 years feels like a long time … it’s not that long when it comes to trying to get a project permitted, moved and actually delivering revenue to the state coffers.”

Dunleavy’s Department of Revenue presented a newer fiscal model to lawmakers on Thursday, which accounts for revenue from the proposed Alaska LNG project and a new split of oil revenue from the federally-owned National Petroleum Reserve Alaska in the Western Arctic enabled by President Trump’s signature tax- and spending-cut bill.

“That modeling does roughly balance” even after the taxes expire, Department of Revenue Chief Economist Dan Stickel said to lawmakers on Thursday.

So far, the plan has landed in Juneau with a thud. Speaker of the House Bryce Edgmon, a Dillingham independent, said alongside other legislative leaders on Talk of Alaska on Tuesday that he’s not optimistic about its chances.

“The early analysis that we’ve done … would suggest that the governor’s plan, in its totality, would actually increase our problem, it would not lessen it,” Edgmon said.

Even Dunleavy’s traditional allies are skeptical — the Republican House minority leader, Palmer Rep. DeLena Johnson, called his plan “incomplete.”

“I think it’s very difficult to ask your average, hardworking Alaskan to increase their grocery budget” without a serious analysis and reduction of government spending, Johnson said.

But where does that leave state leaders’ search for a solution?

Edgmon and his Senate counterpart said they were intrigued by what they recently heard from a panel of University Alaska Anchorage economists who studied a variety of options at the request of the governor.

Senate President Gary Stevens, a Kodiak Republican, says he was interested in the economists’ conclusion that raising taxes on corporations and oil and gas would have the smallest impact on the state’s economy.

“It’s much more stressful on folks to have a sales tax or an income tax,” Stevens said. “(It’s) easier to accumulate a little higher tax on the industry.”

But in the last year of Dunleavy’s term, Stevens said, it might be too late for this governor to solve the problem.

The House Finance Committee is taking public testimony on Dunleavy’s tax bill, House Bill 284, at 5:30 p.m. Thursday. There’s more information on the Public Testimony Opportunities page at akleg.gov.

More than 90% of the comments submitted to the state reject the Cascade Point ferry terminal proposed in Juneau. Many of the comments opposing the project suggest the purported benefits to ferry passengers are disingenuous, and the project looks instead like a fast-tracked subsidy for mining companies.

Dozens of commenters said that the public process to approve this project is lacking, with the comment period and a highly criticized economic analysis coming after the state already signed a $28 million contract for the first phase of construction, set to begin this summer.

The plan includes developing an access road from the end of Glacier Highway north to the site — roughly 30 miles north of the existing Auke Bay Ferry Terminal — and a staging area for future construction.

Leaders in Skagway and Haines oppose the project. Members of the Alaska Marine Highway Operations Board have also questioned the motives behind it and said it doesn’t fit into their long-range plan for the Alaska Marine Highway System.

Public funds for private industry

The Juneau Assembly hasn’t taken an official stance on the state’s plan, but Assembly Member Maureen Hall wrote a comment objecting to it. 

“I oppose the use of public funds to construct a remote State of Alaska ferry terminal when the facility’s apparent primary purpose is to function as an ore dock for private industry,” Hall wrote. “This represents a blatant misuse of public resources and raises serious concerns about the appropriateness and legality of such expenditures.”

Of the more than 500 comments opposing the project, a majority said the project would mainly benefit mining companies with holdings nearby and Goldbelt Native Corporation, which owns the land where the terminal would be built. Thirty-three commenters called the project a “boondoggle” outright, including Juneau resident Bjorn Wolter. 

“There is just no reason at all to build a new terminal,” Wolter wrote. “This project has all the potential to be another South Mitkof or Coffman Cove boondoggle.” 

Those ferry terminals on Mitkof Island and Prince of Wales Island cost millions of dollars. They were built far from the population centers they were meant to serve and close to logging sites 20 years ago. Two years after they were built, the Inter-Island Ferry Authority stopped running routes to them, and both have since sat unused. 

The Cascade Point ferry terminal stands to benefit the New Amalga gold mine proposed near the face of Herbert Glacier by Grande Portage Resources Ltd., a Canadian company. In December, Grande Portage announced that it is working with Goldbelt to design an ore barge dock alongside Cascade Point.

Ian Klassen, president and CEO of the company, was one of the 49 people who commented in favor of Cascade Point. He wrote that the plan will “create possibilities that currently do not exist north of Juneau for the reliable movement of cargo and commerce.”

Steve Ball, general manager of Coeur Alaska’s Kensington Mine, located across Berners Bay from the proposed site, also wrote in favor. 

“The twice-daily boat trips to the Kensington Mine would depart from the new Cascade Point Ferry Terminal, resulting in reduced risk for our workforce, contractors, and visitors by shortening the distance of the boat run and exposure to the Upper Lynn Canal,” Ball wrote. 

Coeur Alaska contracts with Goldbelt to transport miners to Kensington, mainly from Yankee Cove and from Echo Cove during inclement weather. 

Ferry users weigh-in

The state has been pushing for the new terminal for several years and has said it would benefit travelers in Southeast by reducing operating costs and travel time between Juneau, Haines and Skagway. 

But hundreds of commenters said building a second terminal in Juneau doesn’t solve the problems that the Alaska Marine Highway Service faces, including an aging fleet, crew shortages, reduced sailings and a lack of funding to address those issues. 

Robin Ross is treasurer for the Organized Village of Kake, the tribal government for the village, and secretary for the Kake City School District. She commented that the project fails to address ongoing transportation needs in Southeast. She said a ferry cancellation disrupted a mammogram van service that provides cancer screenings for women there, and while flights were arranged for some women, not all were able to travel. 

“The unfortunate reality is that a recent breast cancer diagnosis in October may have been

detected sooner had the ferry service not been canceled in May,” Ross wrote. “The ferry service serves as a critical lifeline.”

DOT’s FAQ page says, “terminal projects like Cascade Point are a critical step toward a stronger, more resilient system while new vessels are planned and funded through separate processes.”

But members of the Alaska Marine Highway Operations Board told the Anchorage Daily News that the project has been foisted upon AMHS and will create operational challenges they have to deal with. Last year, Gov. Dunleavy vetoed state legislators’ plan to divert funding from Cascade Point. 

Southeast residents said that while a ferry ride from Juneau to Haines might be shorter, the burden will be placed on drivers and walkers to get to and from the new terminal, which is much farther from the city center. The city bus system already does not extend to the Auke Bay ferry terminal — it’s about a two-mile walk along the highway shoulder from the last stop. 

Sean Powell, a current AMHS crew member, commented that commuting to Cascade Point would be much more difficult. “The increased distance, combined with weather conditions and other unforeseen disruptions, would add unnecessary challenges for crew members,” he wrote. “I believe funding would be better spent improving our existing infrastructure.”

Emily Mesch drives for rideshare services in Juneau during the summer and commented that it’s already difficult to make money driving people to the Auke Bay ferry terminal since it’s not centrally located. “I would never pick up a passenger there,” she wrote of the Cascade Point location, “unless the fares were about as high as a ferry ride, itself.” 

According to the Alaska Department of Transportation, Goldbelt has committed to running a shuttle service from Cascade Point to Auke Bay and the Mendenhall Valley, but hasn’t set a ticket price yet. 

DOT said that increasing snow plow service along Glacier Highway would cost about $30,000 if ferries operate out of Cascade Point in the winter. But after back-to-back snowstorms slammed Juneau this winter, some commenters said they’re not confident that plow service would be reliable. 

“DOT and the city are both overwhelmed when we get snow, let alone the storms that have hit at the end of December and into January,” wrote Morgan Ramseth. “Placing necessary services at the end of a poorly maintained road seems completely out of touch with reality.”

Others said increasing traffic farther out the road would stretch the city’s emergency services thin. 

The comment period for the first phase of the project ended on Jan. 9. The Alaska House Transportation Committee will hold a hearing with the Alaska Marine Highway Operations Board and DOT on Thursday, Feb. 5 at 1:30 p.m.

A round of vetoes by Gov. Mike Dunleavy last summer have Alaska’s construction industry on edge. Industry groups are pushing state lawmakers to quickly pass an appropriations bill that they say would unlock hundreds of millions of dollars in federal matching funds.

The problem started last year, when lawmakers searched for funds to plug holes in the state budget. To fund the state’s share of a variety of new federal projects, lawmakers voted to take millions from older, stalled-out or completed projects — tens of millions from the Juneau Access Project, $138,000 from the so-called Bridge to Nowhere in Ketchikan, even $766 lawmakers found left over from efforts to explore a bridge over Knik Arm from Anchorage.

“At the end of the day, we’re really just pulling out of the couch cushions the little pennies we can find here and there,” said Rep. Ashley Carrick, a Fairbanks Democrat, during debate on the budget last year.

But then, after lawmakers adjourned, Gov. Mike Dunleavy vetoed those transfers. His office said a lot of the money lawmakers identified had been spent, committed to contracts or was otherwise unavailable.

“We don’t want to put ourselves as a state in a position where we don’t have the match because those funds have already been obligated or are no longer available because they’ve already been spent,” budget director Lacey Sanders told lawmakers last month.

To make up for the vetoes, Dunleavy has requested state lawmakers send him a budget bill that would fund the state’s match with $70 million in unrestricted funds to enable some $700 million in total spending, 90% of which would be covered by the federal government.

But for now, state officials say they have only enough money on hand to meet the state’s share of federal projects through about the end of the fiscal year on July 1.

That has contractors ringing alarm bells.

“You are introducing unnecessary risk and disruption to this process,” the head of the Associated General Contractors of Alaska, Alicia Kresl, said to the House Finance Committee.

For now, Transportation Commissioner Ryan Anderson appears less alarmed. He told lawmakers the state has its match covered for the current fiscal year, though that money runs out around the end of June.

“It’s after July 1, that additional, that we’d be missing out on, so we’re really right now focused on that,” Anderson said.

But not knowing for sure whether that money will materialize after July 1 makes it hard for construction contractors to gather the right supplies and equipment, assemble their workforce and be ready to hit the ground running, Kresl said. So any further delays getting the money out the door could risk much of the progress crews would otherwise make in the 2026 construction season, she said.

“When funding comes late, the construction industries and agencies can shift from planning mode into scramble mode,” she said.

Lawmakers have so far appeared receptive. Leaders of the House and Senate finance committees say they plan to move quickly on a supplemental budget that would provide the matching funds. They have said they’ll likely draw from state savings to do it, requiring a three-quarters supermajority in both the House and Senate.

And Sen. Bert Stedman, the Sitka Republican who orchestrated much of the couch-cushion-shaking last year, says the state’s tight budget this year means they’re looking for more spare change floating around state government.

“Last year was not some aberration, it was not some off-the-cuff idea. It was methodically sought out and well-researched by (the Legislative Finance Division) and both finance committees, and this year will be the same,” he said.

But this year, he said, he’s hoping for a different result.