We wish the best for Alaska
legislators heading back to Juneau for the special session that starts on Monday.
Over the past months, lawmakers probably have received more than their fair share of frustrations from constituents, media and pundits alike — everyone’s a critic. In many ways, the Legislature has faced a lose-lose proposition. With money short, no matter how they do their job, somebody is going to be left unhappy and disenfranchised.
Whether decisions made to balance the budget result in a reduction of permanent fund dividend payments, or in reductions in funding to education or other government programs, cuts generally have the greatest impact on those least able to afford them. And that includes tax credits for oil companies, as the smaller explorers that have come to Cook Inlet are more reliant on incentives.
The measure currently on the table to partially address the state’s $3 billion-plus budget shortfall is Senate Bill 128, which passed the Senate but was voted down in the House Finance Committee. The bill would generate about $1.92 billion in revenue for state general fund spending. It’s not a total fix, and is intended to be the cornerstone of a package of spending reductions and other new revenue measures.
Indeed, it is clear that, short of a miraculous recovery in oil prices, there is any one measure that would work by itself. Alaska needs to take an all-of-the-above approach to address the current situation, and to ensure it doesn’t happen again.
The sticking point with SB 128 is that it restructures the way in which Permanent Fund Dividends are paid out. Alaskans would receive $1,000 dividends through 2018; after that, dividends would be paid out from a portion of a 5.25 percent draw on the Permanent Fund and a portion of oil royalties. The other part would go into the state’s general fund.
Numerous members of the Legislature, including some of those in the House Finance Committee who voted against advancing the bill, have said they will never touch the Permanent Fund.
With lawmakers dug in, it does not seem likely that much can be accomplished in the upcoming session. In an interview with the Clarion on Wednesday, Lt. Gov. Byron Mallott expressed as much, noting that lawmakers were focused on their upcoming primaries and how the Legislature will be structured next year. For all intents and purposes, they have moved on from this year’s battles.
In our view, the best-case scenario for the upcoming session — as least the most realistic one — would be to see if, with a couple of weeks to think about it, House Finance could amend SB 128 to get one more vote (it failed on a 5-6 vote to end the last special session) and advance the measure to the full House. Perhaps Gov. Bill Walker’s budget vetoes will be enough to sway the vote.
House members likely already know whether there’s enough support in the House to pass the measure, but the public needs to see where they stand.
If there’s enough support pass a bill, let the conference committee go to work. If not, gavel out, come home and try again in January. We don’t like seeing inaction from the Legislature on the biggest issue facing the state, but we also don’t see a point in beating a dead horse.
And after two extended regular sessions and four previous special sessions, the 29th Alaska Legislature is starting to look pretty whupped.