The eighth day of the legislative session saw legislators start to dig into the policy behind Gov. Mike Dunleavy’s state of the state address. What they found, at least at first look, seemed to be largely disappointing.
‘It sounds like the governor is saying ‘You figure it out.’’
The Senate Finance Committee’s hearing with newly appointed Office of Management and Budget Director Neil Steininger could be the source of about six different stories (we’ll have one out shortly). It was a dense meeting where the senators started to dig into the budget. Several complained that they saw little of the governor’s State of the State address or promises from this year in the document.
The main takeaway from the OMB presentation is that you can’t cut your way to covering the $1.5 billion deficit (that Sen. Natasha von Imhof noted is entirely due to the PFD) and that it will need legislative efforts to address formula-driven elements of the budget. That’s more or less what Dunleavy has hinted at his budget roll out and subsequent appearances in front of conservative audience: That he wants to go after statute-driven spending like Medicaid, K-12 funding, retirement benefits, state employee costs and debt service.
As von Imhof quickly pointed out at the start of the presentation, OMB had entirely omitted any attention to the state’s single largest formula-driven program: The PFD. She even had her own slide prepared to make the point.
“There is no budget deficit before paying a permanent fund dividend,” she said, later in the meeting adding, “Are we going to cut education to pay a permanent fund dividend?”
What was pretty remarkable is that the administration has yet to announce any kind of alterations to formula-driven programs and doesn’t appear like it plans to anytime soon. That would leave it to the already-marginalized Dunleavy Republicans to carry, which doesn’t give it a particularly great shot at passage.
Sen. Lyman Hoffman, D-Bethel, was particularly bothered by the administration’s refusal to lead on the budget or new revenue (beyond the paltry suggestion of a state lottery).
“How are you helping us when you’re giving us no solutions. Instead of working with us and finding solutions, you’re saying that we will not look at additional revenue from the industry, which is a large amount,” he said. “It’s going into a fight with one hand tied behind our backs.”
The Senate Finance Committee is certainly approaching the budget discussion with a sense of urgency. Sen. Bert Stedman, R-Sitka, frequently eschewed any talk of a 10-year fiscal plan in favor of a three-year survival plan as the governor’s proposal would see savings depleted in a matter of years.
Sen. Donny Olson, D-Golovin, agreed.
“It’s very troubling that there isn’t a plan out there,” he said. “It sounds like the governor is saying ‘You figure it out.’”
The committee also seemed to hone in on issues related to the rural public safety, education, the marine highway and the Pioneer Homes and will be dedicating additional attention to these issues in the coming days.
The University of Alaska
University of Alaska President Jim Johnsen was in front of the House Finance Committee on Tuesday, where he gave the rundown on what was a pretty bad year for the University of Alaska. Several majority legislators spent the meeting reiterating their support for the university system while conservative minority members continued to build the reasons why the university needs to continue to hurt.
If you need a good idea of where the budget battles have left the University of Alaska, Alaska Public Media’s Tegan Hanlon has a new report out this morning showing that the University of Alaska Anchorage’s enrollment dropped 10 percent this fall:
“The number of students who signed up for UAA classes this fall compared to the year before fell by about 1,500 students, or nearly 10%, according to preliminary data from the University of Alaska system.”
House State Affairs advances two measures
The House State Affairs Committee advanced HJR 15, a proposed constitutional amendment to lower the threshold for veto overrides to two-thirds (40 legislators), and HB187, a law that would bar the state from sending inmates Outside in almost all scenarios.
The committee heard some testimony on both measures before advancing them. Dunleavy supporters opposed HJR 15 while former house speaker and current writer Mike Bradner testified in support of the measure, saying that the last year has revealed a “constitutional crisis” where the Legislature effectively has no shot at overriding budget vetoes.
He argued that the highest in the nation threshold of three-quarters (45 legislators) is compounded by the Legislature’s relatively small size and high geographic differences. He argued that some areas of the state could effectively be bullied into blocking veto attempts.
Unsurprisingly, Dunleavy-aligned Reps. Sarah Vance and Laddie Shaw were the lone votes against advancing the measure. The legislation needs two-thirds of each chamber to be sent to voters for consideration.
The committee also advanced House Bill 187. The administration’s announcement that it was abandoning plans to ship inmates Outside (likely more due to a lack of interest than anything else) has done nothing to blunt legislative enthusiasm for the bill.
There was, however, some legal issues that sprung up with an amendment brought by Rep. Sharon Jackson for the bill. Her amendment would have added more options for the administration to consider transferring individuals Outside. One of the options that raised issues was for inmates sentenced to 99-year sentences, which both legislators and the administration said didn’t really hit the mark of the intent to allow the administration to ship out folks who will never be returned to Alaska society.
The problem with the 99-year sentences is that in most cases those individuals would be eligible for parole far before the end of that sentence.
Still, the measure was advanced from committee with the amendment and some other lingering concerns. The bill heads next to the House Finance Committee.
The state held its first-ever PFD Education Raffle on Tuesday, where they selected four winners who took home between $17,396 and $2,174. The raffle collected a total of $869,800 in $100 entries from PFD recipients (for comparison, a state lottery is estimated to raise about $10 million annually).
Half of that money will go to education grants and a quarter will go to an education endowment fund. The remaining quarter was split between the awards and a raffle endowment that will help grow the size of the payouts in future years.