Walker urges action on plan to address deficit

JUNEAU — Gov. Bill Walker reiterated his call for passage of a state fiscal plan during a fiery news conference Wednesday in which he also pushed back against criticism that his administration isn’t doing enough to sell lawmakers and the public on his proposals.

“Do we have to go broke before we fix Alaska? I guess that’s my question to the Legislature,” Walker said.

Walker’s frustration spilled over a day after legislators passed a state operating budget, the timing of which was intended to keep state workers from receiving layoff warnings. Notices would have gone out Wednesday without the passage of a fully funded budget.

Legislative leaders called the budget responsible and a product of hard-fought compromise that further reduced state spending. But Walker’s budget director, Pat Pitney, said that in some cases it included use of one-time funding and booked expenses in the current year. That’s problematic because it will have to be accounted for in future budgeting, Pitney said.

When you take those items into account, “we haven’t substantially moved the dial,” Pitney said. Without a long-term plan to address the state’s deficit, use of the constitutional budget reserve to pay for the budget won’t be an option anymore, she said.

Senate Finance Committee co-chairman Pete Kelly, in a release, said lawmakers delivered a “straightforward budget for the people of Alaska, which made actual cuts to state government.”

Walker said he wanted to see if lawmakers pass any revenue bills before deciding on possible vetoes.

The centerpiece of Walker’s fiscal plan calls for structured annual draws from Alaska Permanent Fund earnings, and it would change how the yearly dividend that most Alaskans receive is calculated. It includes a proposed a personal state income tax and increases in taxes on motor fuels, cigarettes, alcohol and numerous industries. Also still pending is a rewrite of Alaska’s oil and gas tax credit program.

Walker said he’s been so fixated on his plan because an alternative has yet to emerge.

Legislative leaders have committed to vetting pieces of Walker’s plan, but they have offered no guarantees about what might pass.

Any revenue measures passed could impact the level of draw needed for the coming year, and Rep. Sam Kito III, D-Juneau, said that’s the goal now.

Senate Finance Committee co-chair Sen. Anna MacKinnon, R-Eagle River, said there is recognition that the state needs to diversify its revenue stream, but lawmakers need to carefully evaluate the impacts of the different proposals.

She said she told Walker there isn’t support for all of his bills.

Kelly said people have to vote their consciences, “and you wouldn’t have them change their vote just so we could appease the governor or just so we could get out of here. That’s not the way government should be done.”

House Speaker Mike Chenault, R-Nikiski, said he had no problem personally with voting on any of the bills on the special session agenda.

“But those bills have to have support to get out of committees, and they have to have support to get on the floor,” he said. “And I can’t guarantee that support. I can only guarantee me.”

During a news conference Tuesday, Chenault and House Majority Leader Charisse Millett said Walker needs to help get his proposals passed. Millett, R-Anchorage, said she looked forward to the governor engaging with them.

Walker said his administration has been engaged and was offended by any suggestion otherwise.

Walker couldn’t say if he would call legislators back into special session if the big permanent fund bill doesn’t pass. But he made clear that he expects action.

“When I say we need to get the job done this year, I mean we need to get the job done this year,” Walker said.

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