Alaska House & Senate Restores 80% of Governor's Vetoes; $400 million added back to budget
Governor Comments on Actions Taken in Alaska State Legislature
By MARY KAUFFMAN
July 29, 2019
Overall, two-thirds of Alaska lawmakers voted for House Bill 2001, which restores 80 percent of the governor’s vetoes to state efforts to improve the public safety, health, and education of Alaskans, while also providing for a Permanent Fund Dividend of approximately $1,600 per person.
In a prepared statement after the vote, House Speaker Bryce Edgmon (I-Dillingham) wrote, “Alaskans spoke loudly in favor of striking a balance between the Permanent Fund Dividend and essential programs and services that were vetoed by the governor. With broad bipartisan support, lawmakers today finalized a plan which embraces the fact that we need to right-size government through difficult cuts but also acknowledges that we cannot cut our way to prosperity.
"The Alaska House Majority heard the outcry and thanks the thousands of people who took time out of their busy lives to advocate for the type of policies we enacted today. We encourage supporters to stay engaged by urging the governor to sign our plan without making additional damaging vetoes,” said Speaker Edgmon.
“Today’s vote is about moving Alaska forward,” said Senator Natasha von Imho f( R-Anchorage) co-chair of the Senate Finance Committee. “This compromise bill restores funding to programs affecting the life, health and safety of Alaskans while also paying out the largest dividend we can afford.”
A law enacted last year caps spending from the Permanent Fund at a sustainable rate. Without reforming the decade’s old dividend formula, lawmakers could not find agreement on a dividend larger than $1,600.
“Our predecessors had the vision to protect Alaska’s oil wealth for the future, and we must do the same,” said Senator Bert Stedman (R-Sitka) co-chair of the Senate Finance Committee. “The Permanent Fund is not for us to squander. We must do everything in our power to protect it for future generations.”
The Alaska Legislature today also approved a capital budget, Senate Bill 2002, providing the state’s private sector with $1 billion in federal matching funds for highway and construction projects.
“We appreciate the governor adding the capital budget to the agenda,” Sen. Von Imhof said. “With its passage, we’ll save thousands of Alaska jobs and bring in more than $1 billion in federal matching funds.”
After the vote today, Senate Democratic Leader Tom Begich (D-Anchorage) issued the following statement: “Today is about putting the state back on a path of hope and opportunity for all Alaskans. By restoring these vetoes, young Alaskans will have access to a quality University of Alaska, veterans will continue to receive services, and seniors will have the support they deserve. Through these votes, the Legislature is standing together. I can only hope the Governor will choose to stand with us in defending all Alaskans as we move this state forward.
Begich wrote, “The process set forward by the House and Senate majorities was fair, and I thank them for involving the entire body. This is the way representative democracy should work, and it works well.”
Begich also said in an evening newsletter, the Legislature is not done yet. "There is an elephant in the room, and it comes in the form of oil tax credits equaling more than $1.2 billion dollars a year."
"This inequity must be addressed. The wealthiest corporations in the world must also contribute to creating a safe and stable Alaska during this time of budget crunching," wrote Begich.
The bill also addresses the ‘reverse sweep’ issue, which will save scholarships for 12,000 students, reduce energy prices in rural Alaska by protecting the Power Cost Equalization program, and provide grants to organizations that combat domestic violence and homelessness.
Senate Communications' spokesperson Daniel McDonald clarified for SitNews what this bill addresses for the University of Alaska's funding: "Last year's (FY 2019) university funding from the state was $327 million. The Legislature's $5 million reduction plus the governor's $130 million veto brought the university's state funding down to $191 million. HB 2001 restored about $110 million, bringing the university's funding total to $302 million for FY 2020, which is still $25 million less than last year."
McDonald also wrote in an email in response to a question concering Alaska Marine HIghway funding, "In terms of unrestricted general funds (UGF), the marine highway received $86 million last year and is now, with the $5 million addition, at $51 million.
Vetoes not restored in HB2001 by the legislature are available here.
Governor Michael Dunleavy commented this evening on the Alaska State Legislature’s passage of HB 2001, legislation that the Governor says robs Alaskans of a statutory Permanent Fund Dividend and restores previously vetoed budget items. The Governor also commented on SB 2002, a capital budget that provides funding for various priorities and necessary federal matching funds for critical highway, transportation and safe water projects.
“Four short years ago, no politician would have thought about taking the PFD without working with Alaskans. For decades, the PFD grew under the protection of the people and benevolent politicians. However, today it appears work has been completed by those intent on killing the PFD – representing a major setback for those that believe in following the law and a sustainable government. Unfortunately, with this action the PFD is no longer a dividend, but a primary source for government spending and growth,” said Governor Dunleavy.
The Governor said, “Taking the PFD is the first in a series of taxes that will continue to prop up government and spend beyond our means. Unfortunately, a number of legislators continue to drive a false narrative – a choice between a full PFD or essential operations of government. The reality is, only those intent on using the Earnings Reserve as a government revenue source believe the PFD and the budget should be connected. The government shouldn’t be taxing your PFD, it should be spending less.”
“The add-backs to spending – to the tune of $400 million – are yet another attempt to blow up the size of government. I stand by the decisions made on June 28th and the focus we’ve made on providing a sustainable budget and sustainable systems. These reductions are not meant to harm Alaska or Alaskans, but to turn the corner and make the necessary changes in order to put Alaska on a sustainable path forward. While we will consider a limited number of additions to the budget, we consider the vast majority of the FY20 budget final. It’s time to move forward.”
“While months overdue, today’s action represents an important step in the Legislature bringing this gridlock to an end,” said Governor Dunleavy.
The Governor said, “My team and I will be thoroughly reviewing the details of this bill, but believe it represents significant progress in moving Alaska forward, particularly for items like the Alaska Performance Scholarship, WWAMI, PCE, and efforts to capture more than $1 billion in federal transportation and infrastructure dollars – critical to keeping our economy growing and our communities moving. Somewhat lost in the political theater, this package also provides critical funding to implement HB 49, legislation that provides Alaska the tools and resources to improve public safety. While sentencing is one important aspect in addressing Alaska’s public safety crisis, supporting our law enforcement agencies with the resources they need to do their job is a cornerstone of this administration. While I intend to sign SB2002, I will exercise my line-item veto authority where necessary.”
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