Two-thirds of the way through the special session, Gov. Bill Walker is asking the Legislature to please, just do something to reach a budget compromise and avert the July 1 government shutdown. Today, Walker kept pressing the sales pitch for his compromise even though House Majority Caucus leaders panned it as soon as it came out.
“It may not be a perfect compromise, but it’s the only compromise that’s on the table. I would welcome dueling compromises. … I think compromise is key to resolving the situation that we are in today,” he said in a 1:30 p.m. news conference. “It’s the key to resolving the fiscal crisis we’re in and compromise is the key to making sure we don’t have essential government services shut down on July 1.”
Walker gave the Democrat-led House Majority members room to walk back their statements.
“What jumps off the page is what they lost, not necessarily what stayed on that was important to them,” he said. “I’ve done that myself in the past, it’s not unusual and it’s not inappropriate. … Sometimes it’s necessary to find the courage to temper our own passion to allow the conviction of others to play a role in the compromise itself, but the fact remains: We’re running out of time.”
The House Majority, for its part, doesn’t appear to be wooed by his words. Their concerns remain and Senate Minority Leader Berta Gardner also released a statement this afternoon that the compromise “comes down on the wrong side of the details.”
Though there is at least one member of the House majority who sees something to salvage from the proposal.
With some tweaks to revenue and cash subsidies for oil companies, I would be supportive of @AkGovBillWalker compromise plan. #akleg https://t.co/EAflAIriSw
— RepJasonGrenn (@RepJasonGrenn) June 6, 2017
What’s interesting, however, is that it sounds like the Senate Majority—the great resister of compromise this session—hasn’t entirely turned up its nose at the governor’s proposal. It’s unclear what their asks are, but it seems that they’re not a hard “no” like the House Majority.
Reporters down in Juneau got a sit down with Senate President Pete Kelly at 4:30 p.m. today. I haven’t heard or seen details from that, yet.
Though the Senate Majority has been pretty hard-line in its previous statements and dealings with the House, it’s not entirely surprising it’s more open to the governor’s compromise than the House. The big win for the House Majority in the compromise was the restoration of all the cuts to the operating budget that the Senate made mostly for leverage purposes in the first place.
And the broad-based tax the House Majority has on its wish list is not well represented in Sen. Click Bishop’s Senate Bill 12, a pretty regressive head tax for school facilities that never got a hearing this session.
Hoffbeck explains gives and takes of compromise
Department of Revenue Commissioner Randy Hoffbeck was also at Walker’s news conference, where he laid out the reasoning behind the proposed compromise.
The House Majority and those aligned with it get an operating budget that assures services and programs continue and doesn’t pass the burden onto others, they get a broad-based tax structure and the end of cashable tax credits. In return, they must accept a $1,000 dividend, less revenue and progressivity from a broad-based tax, and limited oil and gas tax reform with repayment of some of the outstanding credits.
The Senate Majority and those aligned with it get the Senate’s version of SB26, the permanent fund bill, and HB111, the oil and gas tax bill, and are able to make larger payments to the oil and gas industry to pay off tax credits, but have to concede a modest broad-based tax structure and restore the operating budget reductions.
The state gets a level of fiscal stability, avoids shutdown and must continue to show significant restraint in spending to stay within available revenues.
Conference committee closes out two (mostly non-contentious) budgets
The conference committee on the operating budget actually met Tuesday afternoon and closed out the budgets for the Department of Administration and the Department of Commerce, Community and Economic Development. There’s not a ton of excitement or controversy between the House and Senate versions of these budgets. The committee agreed to delete intent language for the DMV that would have driven it to outsource or privatize as many of its services as possible and another that would have prohibited funding from being used to collect information that could be used for facial recognition software.
Oh, and they also accepted the Senate proposal to allocate $15,000 of vehicle rental tax income for a seasonal position at the Tok Visitors Center.
Rep. Paul Seaton, the chair of the committee, said they’ll likely meet again later this week.