Legislature adjourns; governor calls special session

  • By Becky Bohrer
  • Monday, April 27, 2015 9:57pm
  • News

JUNEAU — Gov. Bill Walker spared little time in calling state lawmakers into a special session to deal with issues including the budget and Medicaid.

Walker’s proclamation came shortly after the Legislature adjourned from an extended legislative session Monday night. Lawmakers adjourned with a partially funded state budget for next year after the Democratic-led House minority failed to support the budget and a draw from the constitutional budget reserve fund to cover costs. Minority members opposed the budget’s cuts to education and its rejection of negotiated pay increases in labor union contracts, among other things.

The special session is scheduled to begin today. Walker’s proclamation includes three items: the operating budget, Medicaid expansion and reform and a bill dealing with sexual assault prevention and awareness programs in schools.

The Senate and House voted to accept a compromise operating budget, with supporters casting it as a responsible response to the multibillion-dollar deficit the state is facing amid a crash in oil prices. But state government would be left with partial funding for the coming fiscal year after the Democratic-led House minority refused to support the plan, saying it reflected the wrong priorities.

The House minority opposes the plan’s cuts to education and its rejection of pay raises for next year negotiated in labor union contracts, among other things.

The Democrats’ support was needed to reach the threshold required to authorize a draw from the constitutional budget reserve to cover the costs. Republican Rep. Lora Reinbold, who was kicked out of the GOP-led majority after failing to support the House version of the budget earlier this year, also voted against the compromise and the draw from reserves.

Negotiations had been occurring between the House and Senate and the House majority and minority. House Speaker Mike Chenault, R-Nikiski, said a failure to reach agreement with the minority was not for lack of trying. He said the minority wanted too much.

It was not immediately clear how Gov. Bill Walker would respond. Walker spokeswoman Grace Jang has said the governor expected the Legislature to pass a fully funded budget.

There was a temporary dustup when the House failed to pass the effective-date clauses on the operating budget, creating the potential for a government shutdown within days. Both sides said they didn’t want that, and members voted again, approving the clauses.

The budget proposal, advanced by a conference committee late Saturday, uses money previously set aside for schools to help cover this year’s deficit. To fund schools for the coming fiscal year, the proposal uses a blend of general funds and $157 million from an in-state gas pipeline fund that Walker otherwise would use for an alternate gas pipeline project that Republican leaders have tried to restrict. Senate President Kevin Meyer, R-Anchorage, said there would still be about $30 million left in the fund.

While the Senate proposed a $47.5 million school funding cut for next year in its version of the budget, the conference committee settled on a $16.5 million cut. That would be on top of cutting $52 million in one-time funds between 2016 and 2017, a cut first proposed by Walker and part of a separate spending package.

Lawmakers in the GOP-led majority said the one-time funds were approved when oil prices were much higher and the state was in a different situation.

The operating budget proposal called for a constitutional budget reserve vote for this year and next. Under the proposal, if the three-fourths vote to access the fund failed and the amount available this year doesn’t cover costs, the amount necessary would come from a fund used for student scholarships.

While the administration has said there would be money to operate into the fall, it’s expected at some point that a draw from reserves would be needed to help fill the budget hole.

The Senate voted 15-5 to authorize the draw, with minority Democrats voting in opposition.

“I am, and I think many of us and many Alaskans, dismayed at what we have failed to do here, and that is fund our public schools, live up to our promises and do something for the thousands of Alaskan working poor who are waiting for health care coverage,” said Senate Minority Leader Berta Gardner, D-Anchorage.

Walker has indicated he would call a special session dealing with Medicaid expansion and reform if lawmakers don’t address it before adjourning. Bills on those topics remain in committee.

Meyer said he feels “very good about what the Senate has done.”

Barbs were traded during the House floor debate about the budget not being funded. House Majority Leader Charisse Millett, R-Anchorage, said not voting for the budget short-funds the government. Rep. Max Gruenberg, D-Anchorage, said a “no” vote was not a vote to shut down government. He said critics of the bill would not be put in a position to support what they consider to be a bad piece of legislation.

The dramatic fall in oil prices since a year ago has exacerbated Alaska’s budget deficit. The focus this legislative session has been on cutting spending and reducing the size of state government before beginning in earnest any discussions about additional revenues. In line with that, lawmakers passed a bill suspending the state’s obligation to reimburse a portion of school bond debt payments. They also voted to repeal scheduled 2.5 percent pay raises for certain state workers not covered by unions.

Supporters of efforts to cancel planned raises for union and nonunion workers said it was an effort to save jobs; critics said the state should honor its commitments.

Failure to reach a budget agreement sent the session, scheduled to end April 19, into overtime.

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