Governor proposes budget with hefty $1.5 billion deficit

The governor has proposed a state budget for next year that does not repeat this year’s education funding increase and pays out a $3,838 Permanent Fund dividend — and runs up a $1.5 billion deficit.

The cost of the dividend, estimated at more than $2.5 billion, consumes 40% of total available state general fund revenues.

Gov. Mike Dunleavy’s spending plan, unveiled Dec. 12, would wipe out more than half of the state’s budget reserve account.

The broad aspects of the Republican governor’s spending plan are similar to those that encountered significant resistance from a bipartisan Senate majorit...