Do it right the first time, and it won’t be necessary to redo or undo it.
That’s a lesson the Alaska Legislature is in the process of learning or learning all over.
The topic is its attempted acquisition of Anchorage office space; it’s been a trying effort, to say the least.
— The Legislature entertained the idea of buying a downtown building with a pricetag of $32.5 million for office space.
— Gov. Bill Walker said he wouldn’t allow that given that the state has a $4 billion deficit. Hats off to the governor.
— Anchorage Superior Court Judge Patrick McKay piled on, stating that the Legislature’s 10-year lease extension of the downtown building’s office space was illegal and invalid. It should have been subject to competitive bidding requirements.
— With that the Legislature came up with a $12.5-million building in the middle of Anchorage. Compared to the Legislature’s rent of $3.4 million annually, this seemed like a bargain — the preliminary selling price is equal to about four year’s rent at the downtown location.
— The Anchorage Borough Assembly went on the record against a midtown location for the Legislature, preferring it be downtown.
— Gov. Walker didn’t balk at the idea of a cheaper building, and presumably the Legislature would do the deal right this time.
But not so fast. The risk department of the Washington-based Everbank, which loaned about $28 million to the Legislature’s landlord at the downtown location with the understanding the Legislature would be the tenant allowing for the necessary payments, piped up. It suggested the Legislature re-read the legal agreement signed by its representative at the time, Sen. Mike Hawker of Anchorage. Essentially, the bank threatened the state with a lawsuit to the tune of about $27 million based on its interpretation of the pact.
The courts undoubtedly will be given the opportunity to continue to sort this out. The bank indicates an appeal of McKay’s decision is likely.
Of course, all of this will take Alaskans’ time and money, both of which the state is running out of quickly. The Legislature’s time should be spent on eliminating the deficit. It’s money, too. And, legislators certainly shouldn’t be adding to the revenue shortage, something that was occurring in December 2014 when Hawker signed the agreement. At that time, the price of a barrel of crude had dropped to around $60.
Everybody makes mistakes. Clearly, the $32.5-million building is a big one. It’s so big that most Alaskans, including legislators, will see the harm in not doing a deal right in the first place next time around.
As the Legislature, for that matter anybody working on behalf of the state, confronts issues as representatives of Alaskans, no factor other than what is best for the state should be uppermost in decision-making. It’s the state first and foremost; other loyalties are secondary. Maybe the office-building situation will serve as a reminder of that as the Legislature focuses on Alaska’s revenue problem. There are solutions, and it will find the right ones. It will do it right the first time. Not only because it’s the right thing to do, but because it has to. Too much depends upon it.
This is a serious matter. That’s a phrase applicable to both the legislative office space topic and the revenue issue. It’s how the bank concluded its letter to Alaska. Indeed it is.
—Ketchikan Daily News, May 14, 2016