Dunleavy vetoes nearly $90M from Alaska budget, cutting education and Medicaid

Gov. Mike Dunleavy line-item vetoed nearly $90 million from Alaska's state budget the day after signing it, with teacher incentive payments, Head Start grants, and a school spending study among the items eliminated, according to The Alaska Times.

Among the cuts: $20 million from the Community Assistance Program, which distributes aid to municipalities; $6.4 million for early education workforce recruitment and retention; $6.25 million for Medicaid community-first and personal care reimbursement improvements; and $5 million tied to direct support professional rate guidelines. Teacher incentive payments, Head Start grants, and a school spending study were also eliminated, according to The Alaska Times.

The $6.4 million for early education workforce recruitment and retention had been approved by the legislature specifically to help child care centers recruit and keep workers. In remarks on the Alaska State House floor on May 19, 2026, Rep. Andy Josephson described the appropriation as "$6.4 million UGF for child care center recruitment and retention."

Dunleavy has now vetoed 18 bills this session. Six additional bill vetoes were announced the same day as the budget cuts. Whether the Alaska State Legislature will attempt override votes on any of the line-item cuts remains an open question.