Budget & Taxes (State Budget)

HB 275 sets a 5% annual limit on increases to most state government spending in Alaska, adjusted for population growth and inflation. It applies to general fund appropriations (excluding permanent fund dividends, mental health trust funds, and specific bond-related spending), requiring that new annual spending cannot exceed the previous year's total by more than 5% plus these adjustments. The bill uses Anchorage's Consumer Price Index for inflation and annual population estimates from the Department of Labor to calculate the adjusted cap. This bill affects all state budget allocations subject to the limit and takes effect July 1, 2027.

This bill limits annual state spending increases to 5% plus changes in population and inflation, excluding specific funds like the permanent fund, mental health trust accounts, and certain bond proceeds. It applies to most state budget items, requiring spending to stay within the previous year's level adjusted for population growth (based on Labor Department estimates) and inflation (using Anchorage CPI data). The limit includes carryover funds from the prior fiscal year. The bill takes effect July 1, 2027.

HJR 1 proposes a constitutional amendment to limit Alaska's annual state spending to a percentage (capped at 15%) of the state's average real gross domestic product (GDP) over the previous five years. Certain spending, including permanent fund dividends, bond proceeds, disaster response, and specific public enterprise revenues, is exempt from this limit. To exceed the limit for capital projects or permanent fund appropriations, the legislature would need a three-fourths vote and voter approval, while regular spending beyond the limit would only be permitted for declared disasters. The amendment would apply to fiscal years starting in 2028 and requires voter approval at the next general election.

This constitutional amendment proposes a spending limit for Alaska's state government, capping annual appropriations at a percentage of the state's average real economic output (GDP) over the previous five years. It would require voter approval for any spending exceeding this limit, with specific exceptions for permanent fund dividends, bond proceeds, and disaster response. As a constitutional amendment, it must be approved by voters before taking effect.