House adjourns without deficit fix; Alaska has 36 months of savings remaining

The Alaska House of Representatives has adjourned the fifth special session of the 29th Alaska Legislature.

At 2:31 p.m., lawmakers agreed to leave Juneau after five days. House members held no committee hearings or votes on resolving Alaska’s $3 billion budget deficit, and they also failed to muster enough support to override any of the $1.3 billion in budget vetoes signed by Gov. Bill Walker on June 29.

“Alaska’s indeed in a fiscal crisis. It’s epic. It’s huge, and we’re all in shock of it,” said Rep. Wes Keller, R-Wasilla, speaking on the floor before adjournment.

While the Alaska Senate passed a measure to partially resolve the deficit by spending a portion of the earnings of the Alaska Permanent Fund, the House failed to even vote upon the approach, which failed in the House Finance Committee. As a result, at present rates of spending, the state of Alaska will run out of financial reserves in 36 months, according to an analysis presented Thursday by Walker. Earlier in the week, the House formally requested to meet in joint session to override one or all of Walker’s 41 budgetary vetoes.

The Senate, which is controlled by a majority that favors larger budget cuts than the House majority, turned the invitation down.

“We’re elected to get the job done. What we did — my personal opinion is we should’ve tackled each one of those vetoes veto by veto. I’ve got time to spend. That’s what we’re elected to do,” said Sen. Dennis Egan, D-Juneau and a member of the Senate minority.

Speaking Friday, Senate President Kevin Meyer said Walker’s vetoes were actually what the Senate majority was seeking.

“There were some advantages to the vetoes in the sense that (Walker) did actually reduce the budget,” Meyer said.

The Senate is scheduled to meet at 11 a.m. Monday and is all but certain to follow the lead of the House and officially end the special session.

Before Speaker of the House Mike Chenault requested to adjourn the House for good, representatives stood up and offered their thoughts on their failure to consequently address the deficit. With the primary election one month away and the general election less than four months distant, most of the remarks had the air of campaign addresses.

“There’s political gain to throw different political entities and people under the bus,” said Rep. Lance Pruitt, R-Anchorage and a candidate for re-election.

Several lawmakers laid blame for the budgetary failure on Walker, with Rep. Craig Johnson, R-Anchorage and a candidate for state Senate, issuing the hardest words.

“In my opinion, Walker has stolen $1,000 from each and every (Alaskan),” Johnson said, referring to Walker’s halving of the Permanent Fund Dividend.

Instead of $2,000 per person, the dividend will be $1,000 per person. Johnson said that cut is the equivalent of a regressive income tax.

“It will suck the life out of our economy,” he said.

Johnson also spoke about Walker’s comprehensive plan for erasing the deficit with mild tax increases and spending from the earnings of the Permanent Fund.

“This governor has not proposed a fiscal plan. What he has proposed is a spending plan. More spending, more taxes, more government and less money in the pockets of Alaskans,” he said.

Rep. Shelley Hughes, R-Palmer and a candidate for the state Senate, agreed with Johnson’s sentiment.

“I think it’s a blessing in disguise,” she said of the budget crisis, explaining that it is forcing Alaskans to consider the correct size of government and may force them to pull together.

Rep. Cathy Muñoz, R-Juneau and a candidate for re-election, took the opposite approach. “I think the governor demonstrated a great deal of courage in his actions,” she said.

While she may not agree with all of his vetoes, she said she supports his restructuring of the Permanent Fund and urged her fellow legislators to “avoid the blame game.”

Rep. Bob Herron, D-Bethel and a candidate for re-election, said the governor should have vetoed the entire dividend in order to force legislators to act. He added that he regrets that he didn’t get a chance to vote on each element of the governor’s plan.

“We should’ve debated them all,” he said. “We should have voted on them all. You can defend a ‘yes’ vote. You can defend a ‘no’ vote. But indecision cannot be defended.”

Pruitt, seeming to speak to Alaskans at home as well as his fellow lawmakers, urged them to keep hope alive.

“The one thing that I want to ask of you … is don’t give up on Alaska,” he said. “Don’t give up on Alaska. Don’t give up on the process. Don’t give up on the people.”

Contact reporter James Brooks at james.k.brooks@juneauempire.com.

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