ANCHORAGE - Gov. Sean Parnell has unveiled a state budget that proposes spending nearly $1.1 billion less than this year but Alaskans should not see a big difference in how their government operates.

A decrease in Medicaid expense is anticipated but the major reductions will be in proposed capital budget spending.

Parnell proposes an operating budget that spends $9 billion overall and grows by less than 1 percent.

The state general fund portion of that is $5.7 billion.

He proposes a $1.8 billion capital budget, down from $2.9 billion this year. The state general fund portion would be $795 million.

Projected revenue is just more than $7 billion, leaving a $508 million projected surplus.

Parnell says he will push key initiatives such as additional state troopers and village public safety officers.