The Alaska Senate has passed a balanced and transitional operating budget for Fiscal Year 2026, aiming to safeguard essential services while bracing for potential financial strain in FY 2027. The plan includes a $150 million fiscal buffer and avoids drawing from the state’s Constitutional Budget Reserve (CBR), reflecting lawmakers’ focus on long-term stability amid declining revenues.
The $685 million Permanent Fund Dividend remains a key feature of the budget, providing $1,000 per Alaskan. The overall plan is $1.7 billion below Governor Mike Dunleavy’s earlier proposal.
Senate Finance Committee Co-Chairs Senator Lyman Hoffman (D-Bethel) and Senator Bert Stedman (R-Sitka) emphasized fiscal prudence.
“We’ve passed a budget that reflects the situation we’re in, not the one we wish we had,” said Senator Hoffman. “Revenue is down. Fixed costs are rising. We had to make choices that leave room to maneuver in FY27 to continue to provide resources to public education and maintain basic services.”
“We had to make choices that leave room to maneuver in FY27.” Stedman added that the budget “brings balance to competing demands” while protecting core services like education, public safety, and health care.
The operating budget now moves to the Alaska House of Representatives for a concurrence vote. From there, both chambers will appoint a conference committee to resolve the differences between the House and the Senate.