Katie Bender, Alaskanomics, Alaska State Budget, Northrim Bank, State Spending, oil price effect on state budgets, Dave Harbour PhotoAlaskanomics, by Katie Bender (NGP Photo).  There is a lot of discussion regarding the State’s budget and the crunch that is coming in the near future if things do not change. In the October 13, 2014 issue of the Bradners’ Alaska Economic Report, three trends are discussed that will cause an issue for the state after 2020.

It should be no surprise that the decline in oil production is of concern to many in Alaska. This is nothing new for the state, as the decline started in 1989. The past fiscal year saw the decline go from 6 percent to zero percent and there is hope that the new and increased activity on the North Slope will keep the decline flat for a few years. Scott Goldsmith, from UAA’s Institute of Social and Economic Research (ISER), predicts that production would have to increase 2 percent each year to make a dent in reducing the state deficit.  One year of flat production is good, but far from the needed increase make a difference for the state budget.  More here….