Leg with Louie- April 13

The end is near even as the battle continues

A House Majority press conference at the start of this week was suffused with the weird reek of resignation. House members facing the press appeared have entered the third stage of grief. Comprehending the hard, bitter, true and unbelievable fact that they will, at the end of a two-year trench war be left shellshocked and clinging to a regurgitated hairball that is the “Permanent Fund only” fiscal plan delivered by our dangerous and intransigent State Senate Majority – instead of a real fiscal plan.

“Will the coalition have ‘lost’ if they walk away from the session with only a POMV [permanent fund] plan?” Asked Juneau Empire Reporter James Brooks, and then added: “are you losers?”

‘No’ answered House Majority Leader Rep. Chris Tuck – ‘we have had a lot of wins.’ He then enumerated none of them and spoke wistfully about how proud he was of the dynamic coalition and the work they have done.

I hope not to sound uncharitable because I like and respect Rep. Tuck, but this is no way for a House coalition which fought mightily for Alaska, and even grabbed the political 3rd rail and passed an income tax across the House floor, to go out. Better for all of us that they stick with the wise dictum of the actress Ruth Jones “Never give up. And never, under any circumstances, face the facts.”

Fact: only a bad masochist wants to spend their summer sweating in gridlock while their political opponents are out campaigning against them. Fact: the Senate Majority has a stronger lock on power, by their numbers. Fact: the Governor views the use of permanent fund earnings as the most critical aspect of a fiscal plan. Fact: Alaskans are lukewarm to new taxes. Fact: the House Majority is now only at 21 which is barely a majority at all.

Regardless of these facts, there is the fact that they still control the Alaska State House, and the State of Alaska still needs a grown-up fiscal plan, so we don’t devolve into an undereducated colony featuring potholed highways, and crumbling public buildings.

Without substantial changes to the oil tax system, and without a broad-based tax, the main enchilada is the Permanent Fund. Eat enough of this meal, and you will pay your bill with all of your precious PFD, my friends, and those who got you into this mess – the State Senate Majority – will be long gone, out the door and driving away. It is a classic college move: The “fade.” One by one your dining partners at the pizzeria get up from the table under the excuse of going to the bathroom or making a phone call – leaving the last person at the table to either foot the bill – or “fade” out themselves. The transiency of elected office puts Alaskans in the awkward position of always being the final person at the table.

Senator Bill Wielechowski – the heavyweight fighter he is – offered numerous amendments to protect the Permanent Fund, and your Permanent Fund Dividend, when the operating budget crossed the Senate Floor yesterday – all of which predictably fell short of votes.

House and Senate go to the mat today and this weekend and next week to negotiate differences in the operating budget. Let’s wish them the best. I predict that they work out a compromise on the big-ticket items like the level of oil tax credit repayment and that somewhere in the deliberation will be the compromise that lets everyone go home.

As for the long-term fiscal plan, the House Majority may apply another wise dictum, by Bob Marley (via Tacitus) – “He who fights and runs away, lives to fight another day.”

Louie Flora, Government Affairs Director

If you don’t already receive your legislator’s weekly newsletters, consider signing up by emailing his or her office. Below is an excerpt from Rep. Paul Seaton’s Legislative newsletter:

Operating Budget details ℅ House Finance Co-Chair, Rep. Paul Seaton’s weekly legislative newsletter

“The House passed the operating budget last Monday. It was transmitted to the Senate on Wednesday, April 4th. The 5.25% [Perm. Fund Earnings Reserve] ERA draw of $2.7 billion included in the budget is sustainable on a short-term basis. The ERA draw provides $1.7 billion for public services and $1.0 billion for the $1,600 PFD.

The draw needed from the Constitutional Budget Reserve (CBR) to fill the deficit is $708 million, which includes $100 million to cover unanticipated expenses in FY19. As expected, the 3/4 vote to access the CBR did not pass, nor did the 2/3 vote on the effective dates.

Those provisions generally fail first passage and will ultimately be resolved in the operating budget Conference Committee and will be voted on again in House and Senate at the end of session.

All general funds in the House’s budget equal $5.35 billion and all fund sources total $10.44 billion. General funds increased by $170.8 million over the FY18 Management Plan budget for Agency and Statewide Operations.

The Senate Finance CS, as expected, has many differences from the House budget. I’ll just highlight a few of them. Click here  to find various levels of detailed information in the Legislative Finance Division reports.”

Hearings to watch this week

NOTE: the House and Senate have appointed conference committee members to negotiate the operating budget, which triggers the “24 Hour Rule” at which point committee meetings only require 24 hour notice. – things move fast at the end of session, so be sure to monitor the AK Legislature website for updates.

Apr 17 Tuesday 3:30 PM BELTZ 105 (TSBldg)

(S)STATE AFFAIRS Standing Committee
Apr 17 Tuesday 3:30 PM BUTROVICH 205

(H)STATE AFFAIRS Standing Committee
Apr 19 Thursday 3:15 PM GRUENBERG 120

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