AKLEG Recap: Walker demands legislators pass a budget on time in Day Three’s State of the State address

Gov. Bill Walker delivers his annual State of the State address to the Legislature on Thursday, Jan. 19, 2018. (Photo by the governor's press office)

The Alaska Legislature capped off its third day in session by politely sitting through a 49-minute State of the State address by Gov. Bill Walker, which was the independent governor’s final address before the 2018 elections. Here’s what happened and what to look out for.

Just 87 days (plus 121 more if they want to match 2017) to go.

Note: Thanks to everyone for the positive response to the first two recaps. They take extra time to put together at the end of the day or early in the morning, eating up time that I’ve normally put toward gathering and writing our weekly rumor and gossip column Friday in the Sun. We’ll still be doing that, but during session we’ll be publishing it on Friday afternoons. (And, as always, hit me up with tips on Twitter or via email: matt@midnightsunak.com)

Walker’s final State of the State (of this term)

The State of the State address delivered Thursday night was the final address of Walker’s term in office, and he came out swinging against the one group of people that’s even less popular than him: The Legislature.

Walker once again rolled out his call for action to address the state’s financial woes, focusing not as much on the numbers, but the process.

He didn’t talk much about the specifics of the solution (there was hardly a mention of taxes or the permanent fund), but focused on the problems caused by the Legislature’s failure to pass a budget on time. He rolled out what has become his most effective anecdote: A new recruit to the Alaska State Troopers who received a pink slip on his first day at the academy.

“Here was have a young man, willing to put his own life at risk to help protect others, and we have to pink slip him on his first day of training because we the State can’t get our act together?”  he said. “When we don’t pass a budget on schedule, the fishing industry openers are interrupted, the Alaska Marine Highway System can’t publish a schedule, teachers get pink slips and our entire economy is held back by this annual uncertainty.”

As expected, Walker also struck a combative tone with the Legislature as he squared up with the Senate. He explicitly thanked the House for passing a full, tax-including fiscal plan, while much of his complaints about the insufficiency of a cuts-only approach was clearly aimed at Senate Republicans.

He also doubled down on his proposal to put the ax to legislators’ pay and per diem when they fail to pass a budget on time, debuting the slogan, “Let’s pink-slip ourselves before we pink-slip our fellow Alaskans.”

“Any system that cannot deliver a budget with 90 legislative days is broken, and anyone who can’t see that, or who refuses to address it, is complicit in that failure,” he said. “Passing a budget on time is not complicated. Other states do it on time. So can we.”

The Gavel Alaska cameras captured a stony-faced response from Republicans and Democrats save for enthusiastic applause from Rep. Geran Tarr.

We also got another vignette from the governor’s childhood, this time about the hardship his family endured after his father was hospitalized after a serious injury. Without income, his family was forced to move in with another family, and Walker recalled the odd jobs he did when his dad recovered and money was still tight, including writing letters for Santa for a buck.

The speech got generally good reviews from Democrats and some staffers we spoke with, but we doubt it’ll move the needle with Republicans.

A few other takeaways:

  • There wasn’t much time or focus spent on education, though the University of Alaska got kudos for grappling with some of the most severe cuts of any state entity.
  • “Broad-based direct participation by individuals” is apparently the new codeword for “new revenues,” which itself was a new codeword for “taxes.”
  • Walker confirmed rumors that he’s been taking meetings with high-level oil company executives as part of the work on the China natural gas deal, but there wasn’t much detail beyond that.

Per diem problems

For all the ill-advised public griping Republicans have done about Walker’s proposal to “pink-slip ourselves before we pink-slip others” by cutting off legislative pay and per diem when the Legislature fails to pass a budget by the end of the regular session, the House Majority coalition handled the issue far better politically.

At a news conference after the State of the State, House Speaker Bryce Edgmon said he’s willing to “go there” and Rules Chair Gabrielle LeDoux also said she was on board for the plan.

The statements came after a House Finance meeting earlier in the day,

where we saw more Republicans complain about Walker’s plan. This time it was Reps. Tammie Wilson and Lance Pruitt.

Pruitt seemed particularly offended by the unfairness of punishments between Walker (who would lose out on pay for failing to introduce a budget by Dec. 15) and legislators (who have to have a majority of the 60 to pass a budget in 90 days).

“I could have my kid puke out a budget by Dec. 15,” he said.

For all the attention we’ve heaped on Republicans for grousing about the per diem and pay, there’s at least on Democratic legislator who’s been publicly talking about his concerns with per diem and pay. The Juneau Empire reported on Wednesday that Juneau Rep. Sam Kito is considering not running for reelection out of concern about his finances.

He told the Empire that he would normally be able to supplement his legislative income with work as an engineer, but said he hasn’t been able to do that with the Legislature staying in session for more than 200 days.

A dose of reality

Legislative Finance Division Director David Teal met with the Senate Finance Committee on Thursday in a session where he delivered hard truths to legislators. Namely, there’s no more time for playing around because, just as Teal’s projections from years ago said, the state no longer has enough in its traditional savings accounts to cover the projected budget deficit. The Legislature will have to dip into the earnings reserve of the Alaska Permanent Fund to cover the budget, the question is whether they’ll be doing it with or without a plan.

Teal also had some thoughts on other pieces of the governor’s budget plan. He said the biennial budget process Walker is proposing works better in theory than in practice according to the finance directors he’s met from states that have implemented such a plan. He also said that Senator’s hopes for an easily understandable budget for the public wasn’t all that realistic.

Sen. Anna MacKinnon also turned heads when she declared that the word “transparent” should never be used to describe Walker’s budget in the Senate Finance Committee.

What we’re reading

  • Former Gov. Tony Knowles’ resignation from the National Park Service’s advisory board had some folks in Alaska celebrating. That’s because the National Park Service and the board’s emphasis on preservation doesn’t sit well with a lot of outdoors groups. One group even sent Interior Secretary Ryan Zinke a thank-you note for the ouster of Knowles. Read: Wild divide via Craig Medred.
  • Don Young thinks the solution to the gridlock in Congress is to revive earmarks allowing legislators to direct money to specific projects in their districts. The practice was banned by Republicans, but could return. The suggestion would be to delay it until after this year’s election. Read: Rep. Young wants earmarks back, and he’s not alone via Alaska Public Media.
  • The impact on caribou herds by oil development on the North Slope is more complicated than the industry would like you to think. The herds do have boom years when the conditions are good, but they’re more susceptible to the busts. Read: ANWR drilling is huge gamble for Porcupine Herd via the Fairbanks Daily News-Miner opinion page.

What’s in store for Day Four

9 a.m. Senate Finance and Senate Resources—Overview of oil tax regulations for HB 111

Noon Lunch and Learn: Adverse Childhood Experience Study, sponsored by Rep. Gara

1 p.m. House Judiciary—HB15 updating Alaska statutes to recognize same-sex marriage, by Rep. Josephson; HB 216 Restorative justice account, by Rep. Kopp

          House Resources—Department of Natural Resources update by Comm. Mack

1:30 p.m. House Finance—Overview of the Fall 2017 Revenue Sources Book

3:15 p.m. House Labor and Commerce—SB 93 Credit report security freezes, by Sen. Coghill

3:30 p.m. Senate Resources—Overview of forestry development

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