The Legislature is nibbling around the edges on new revenue as the House starts to pull together its budget. Here’s some of what happened on Day 14 (and the week before as I’m attempting to clear out the notebook and get caught up).
Motor fuel taxes on the table
The Senate Finance Committee on Monday heard a proposal to double Alaska’s motor fuel taxes on highway and marine fuels, which would raise an estimated $35.1 million in additional revenue a year. Sen. Click Bishop’s Senate Bill 115 would raise the tax on diesel and gasoline for highway use from 8 cents to 16 cents per gallon and raise the taxes on marine fuels from 5 cents to a 10 cents per gallon.
The increases would take Alaska from the lowest-in-the-nation motor fuel tax rate to the 48th lowest.
It would not affect either aviation gas or jet fuel.
The legislation is intended to address a decline in motor fuel revenues over recent years, which Bishop said has led to several closures of highway maintenance stations. The money would be designated—not dedicated (which is against the Alaska Constitution)—for maintenance of both road and water facilities.
“Our revenues are trending down and they’re going to continue to trend down unless we take some action. I, for one, have had five maintenance stations closed in my district, Senate District C, and this summer we had another station close, the Silvertip station down on Turnagain Arm, and I think we need to stem the tide and increase our motor fuel taxes,” he said. “We’re 50th in the nation. If we double it, then we’ll be 48th in the nation.”
The committee heard mixed testimony on the bill with the usual breakdown of people opposed to taxes while others supported the goal of improved road maintenance. The Senate Finance Committee appeared to be generally in support of the measure, making SB 115 the only new revenue the chamber has seriously considered so far.
The question, though, is whether the whole effort is a waste of time. Gov. Mike Dunleavy has sent mixed messages on revenue, saying that on one hand all options should be on the table to address the state’s budget problems while on the other saying that all broad-based taxes should go to a vote of the people before being implemented.
Sen. Bill Wielechowski, D-Anchorage, sought to get some clarity on that from DOT Deputy Commissioner Mary Siroky.
“Does the administration support or oppose the bill?” he asked.
“At this point, we are here to provide information on the bill,” Siroky said. “And its impacts on our department.”
“Could you provide me information on whether the governor would veto this bill?” Wielechowski responded.
“I will ask that question,” Siroky replied.
Honoring Sen. Bettye Davis
The House voted nearly unanimously to rename the room that hosts the House Health and Socials Services Committee after the late Sen. Bettye J. Davis, who passed away in 2018. Davis was the first black woman elected to the Alaska Senate, where she fought particularly hard for education and schools.
Several representatives, including both Democrats and Republicans, spoke glowingly about Davis’ legacy in the capitol building. Rep. Sharon Jackson, R-Eagle River, said it was a fitting way to start off Black History Month in Alaska. Others said they had their political differences, but said it never got in the way of working together and shouldn’t stop them from honoring their legacy.
The lone vote against the resolution came from none other than Rep. David Eastman, the Wasilla Republican who’s voted against other resolutions and legislation honoring black Alaskans, saying it would be a “mistake” to name the committee after Davis because she supported access to abortions.
In my early years of covering the Alaska Legislature, the finance subcommittee process was shrouded in boring mystery. The Finance Committees put together the budget, I though, and that was all that seemed to matter.
But spend a few minutes tuning into the subcommittees—particularly this year—and you’ll find a trove of information as legislators push back and try to get some answers for the administration’s actions during Dunleavy’s first term in office.
The House subcommittees are already underway and several plan on wrapping up their work by the end of the week before they forward their recommendations to the full House Finance Committee for consideration. These recommendations are not always accepted (look back to the subcommittees run by now-former Rep. Tammie Wilson) but are usually rolled into a new version of the budget.
Here’s a few of the highlights that have come across my radar:
The Judiciary Subcommittee has been getting a handle on the governor’s unprecedented meddling with the court system budget. Typically, the court system provides its budget request to the governor and that is forward directly to the Legislature as part of the governor’s budget proposal. This year, Dunleavy again cut $334,700—the same amount he vetoed out of the current year’s budget for an abortion ruling he opposed—but he has apparently since walked back the cut after a back-and-forth with Chief Justice Joel Bolger. That hasn’t stopped the pushback, though.
The administration is also seeking to charge the court system (and the Legislature) for the time of budget analysts in the governor’s office, which is a way to artificially shrink the governor’s budget. Both the court system and legislators see this as a particularly ludicrous request as both have their own budget analysts.
Court System Deputy Administrative Director Doug Wooliver told the subcommittee that don’t plan on paying it if the Legislature doesn’t send the court system additional money, a proposition the legislators seemed to support.
Will the governor’s proposed elimination of the state dairy inspector kill the state’s dairy program? Yes, pretty much, admitted Department of Environmental Conservation officials in last week’s hearing on the department’s budget. They didn’t quite go so far to say that specifically, but they noted that the dairies would no longer be able to sell their products through the normal avenues. While there’s only two currently operating commercial dairies (up from one last year), there are reportedly an additional four that are in the application process.
The subcommittee on the Department of Law had a ton of tough questions about how Attorney General Kevin Clarkson is going about his several high-profile lawsuits, including his controversial hiring of a right-wing, Trump-aligned law firm to argue an anti-union case. Legislators seemed particularly frustrated that the department seems to be pursuing particularly expensive law firms with an eye on national-level cases while either department time or in-state law firms would be cheaper (and probably better).
The committee didn’t seem to be settled on what to do to exercise some restraint on the Department of Law, but Rep. Matt Claman noted that the Legislature could simply cut the Department of Law’s budget and require that the administration return to the Legislature to request funds for such lawsuits. Claman was clear that such an idea was hypothetical, but it was clear that the Legislature has concerns with Clarkson’s legal antics.
The subcommittee process is, in many ways, the Legislature’s opportunity to exercise some oversight on Dunleavy’s first year in office and get some on-the-record answers to questions that have been circulating all year. In the Department of Commerce, Community and Economic Development subcommittee, there’s been a lot of questions about the $441,000 contract the department awarded to Clark Penney, the grandson of Dunleavy bankroller Bob Penney.
No one seems to know who ordered the—at best—questionable contract. Columnist Dermot Cole breaks down the story in great detail, including email records that directly contradict some of the statements that they’ve made.
Tweet of the Day
— spifffy (@spifffy) February 4, 2020