A series of unexpected windfalls allowed legislators to strike the deal, which funds many items originally eliminated by the Republican-led majority in its quest to cut $60 million from the $2.4-billion general fund budget. Minority Democrats said there still will be sizable program cuts and layoffs, but all of their "must-have" items were funded.

"I feel overall the minority Democrats did a pretty good job of getting things in," said Senate Minority Leader Jim Duncan, a Juneau Democrat. He noted "our ability to leverage things in is limited."

Majority members said they could have reached their budget goal without the extra one-time funding sources, which represent about $40 million of the $62.8 million in reductions, but the session might not have ended as quickly.

"It wouldn't have been nearly as easy and we're not going to turn down windfalls," said Sen. Drue Pearce, an Anchorage Republican who co-chairs the Senate Finance Committee.

The agreement was finalized at about 3 a.m. Sunday, after hours of negotiations, resulting in relatively little debate about the budget on the session's closing day. The budget covers the next fiscal year, which begins July 1.

Democratic support was needed to get the three-fourths vote to access a $3.3-billion reserve fund used to cover an earnings shortfall, estimated by the majority to be $164 million.

Pay raises of up to 1.5 percent for more than 12,000 state employees were negotiated last year, but the majority considered denying them for the upcoming year to help meet spending goals. It became apparent the raises would be granted during the final days of the session, although it was uncertain if the majority would provide funding or require agencies to make cuts elsewhere to compensate.

A breakthrough occurred in the final days when $16 million less than expected had to be invested in the state employees' retirement fund, which was credited to strong stock market performance and legislation passed last year reducing benefits for new employees. Majority members said they would use the money to help reach their $60 million goal, but it helped free up other monies for the contracts.

"I think then that from that point on there was no serious discussion of not funding the contracts," said Rep. Kim Elton, a Juneau Democrat.

How the contracts are actually funded is somewhat unusual: the $12.9 million comes from 59 different sources in the overall budget, including $3.6 million in general funds, $1.5 million in federal funds, and small amounts from dozens of various funds and agencies. About $5 million comes from $13 million freed up in the Investment Loss Trust Fund fund, a $160-million account established by the Legislature years ago to safeguard against poor stock performance in the retirement fund.

A third windfall for the state was about $20 million in lower debt payments. Funding a 20-bed expansion of the overcrowded Johnson Youth Center was one of two "must-have" projects on the legislative minority's list, Duncan said. The second priority was $400,000 in federal money toward a Valdez substance abuse treatment facility.

The $3 million for the Johnson center includes a substance abuse treatment facility, helping keep youths in Southeast who would otherwise be sent to similar facilities in Anchorage, Fairbanks and Bethel.

The majority and minority had different takes on the statewide implications of the budget.

The majority's budget provides full education funding, increases the number of Alaska State Troopers and Village Public Safety Officers, and adds money for maintaining roads, House Finance Committee Co-Chairman Mark Hanley said. Also approved was a $671-million transfer of Permanent Fund earnings back into the fund's principal, one of several such deposits since the fund's establishment.

In addition, the earnings of the Constitutional Budget Reserve Fund will surpass the amount taken from it to balance the state's budget shortfall by $70 million, Pearce said. The erosion of the $3.3 billion reserve fund has been a concern of state officials, since another source of funds or steep cuts would be needed if the money runs dry.

"We are on target with our five-year plan," Pearce said, referring to a plan announced last year to cut spending by $250 million. "We are closing the fiscal gap. We are not at the same cliff we were facing two years ago."

Minority members and Democratic Gov. Tony Knowles said numerous services are hurt by the cuts this year. Among the impacts cited are 90 lost positions at the Department of Transportation and being unable to meet federal welfare-to-work requirements because of job service or child-care reductions.

"To me that's the best kind of cut in government, to reduce this kind of health and social services because people are working," Knowles said. "But I'm not sure we have the tools for that."

Juneau received $1.6 million for replacing the roof at Mendenhall River School and $338,000 for expansion of the Auke Bay Wastewater treatment plant. But more than $2 million in state and federal funds to overhaul the Malaspina ferry was rejected, placing next year's planned day service from Juneau to Haines and Skagway in question.

Funding to design a new National Guard armory in Juneau was rejected, but local lawmakers said they believe it will be included in a supplemental budget approved by the Legislature next year.

The following are among the bills passed by the Legislature this session. If not listed as vetoed or signed, Gov. Tony Knowles has not yet taken action on the measure.

• A steep increase in tobacco taxes, including raising the 29-cent-per-pack tax on cigarettes to $1. Knowles will sign the bill.
• Banning so-called "partial-birth" abortions. The Legislature overrode a veto by Knowles.
• Requiring girls under 17 to get parental or judicial consent before an abortion. Veto overridden by Legislature.
• A tort reform bill restricting damage awards in civil lawsuits and limiting the liability of certain companies and individuals. Knowles has signed the bill.
• Giving companies limited immunity if they find in a self-audit their practices are causing pollution and they correct the problem. The company is also allowed to keep the information confidential. Veto overridden by Legislature.
• Allowing tourism-related signs 18 inches high and 90 inches wide to be posted along highways. Veto overridden by Legislature.
• Making it easier for groups to qualify as political parties by removing a requirement they front a gubernatorial candidate if they have registered voters in the state at least equal to 3 percent of the total votes cast for governor in the previous general election. Veto overridden by Legislature.
• Banning Rohypnol, the so-called "date-rape" drug. Signed into law by Knowles.
• Spending $1 million to fight the "Indian Country" case, involving two Native villages seeking broader sovereign powers. Signed into law.
• Easing restrictions on where concealed handgun carriers are allowed and lowering permit fees.
• Opposing a request that Southeast Alaska provide up to 60 Christmas trees from the Tongass National Forest for the Capitol in Washington, D.C., for 1998. No signature by the governor needed.
• The "no frills" prison bill, limiting food costs, television and other privileges, and banning activities such as martial arts training.
• Requiring students to pass competency tests in reading, writing and math before graduating from high school. Another bill requires teachers to pass a competency exam before certification.
• Allowing victims to be present at criminal trial and allowing them to collect restitution from the defendant's assets, not just prison earnings.
• Allowing legal aliens receiving public assistance before Aug. 22, 1996 to continue doing so, while imposing a five-year waiting period on those applying afterward.
• Building a $24.9-million central public health lab in Anchorage, eliminating Juneau's lab as part of the consolidation.
• Making public the names of minors arrested for more serious offenses, as well as their parents.