Battle brewing over legislators’ per diem

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A brewing battle is taking shape in the Legislature, as lawmakers prepare for the upcoming legislative session in Juneau: How much money do they get for their job as representatives and senators. 

Legislators get paid by the State of Alaska treasury in a handful of ways. Their annual salary is set in law at $50,400 a year (the Senate President and House Speaker get an additional $500 a year). In addition to salary, lawmakers are also reimbursed for their moving costs to and from session. Finally, lawmakers not from Juneau are entitled to take per diem every day the Legislature is in session.

Per diem is not meant to be a form of compensation. Instead, it is meant to offset the costs that people incur for living temporarily in a town away from their home. Yet, the per diem issue has raised eyebrows with government watchdogs for several years. While most Alaskans do not object to the people representing them being reimbursed for the expense of working in the state’s capital, the per diem amount can be shocking: While state workers are reimbursed at a rate of $30 dollars a day if they are working more than 30 days in another location, legislators receive $293 a day, nearly 10 times the state worker rate. 

Unlike a salary, per diem is not-taxable. This creates the opportunities for perverse incentives: The longer legislative sessions and special sessions go, the more tax-free money is issued to lawmakers.

Thus, legislators routinely earn up to $30,000 a year in per diem, bringing the total compensation closer to $80,000 a year, a little more than the average household income for an Alaskan family, which is $77,680. 

Numerous attempts have been made to rein in per diem. Former Rep. Jason Grenn introduced a ballot initiative in 2017. Among other things, the initiative had a simple message to lawmakers: If a state operating budget doesn’t pass after 121 days (which is the constitutional limit for a regular session) legislators stop getting per diem. No budget, no per diem. 

It was a simple idea, and popular. So popular in fact, that in the waning days of session, the Legislature passed a bill almost identical to the initiative, knocking it off the 2018 ballot. 

The 2019 session was long, and the operating budget was not completed in the 121 day time limit. When the budget finally did pass in June, months behind schedule and shy of a government shutdown, the Legislature maneuvered. Using a loophole in its internal bylaws, the Legislative Council, which is the committee that oversees the Legislature’s business, voted to pay lawmakers their per diem retroactively for the period the budget was not enacted passed the 121 day limit. Proponents of the limit, like Grenn, were publicly furious, but hapless to do anything. 

Per diem quieted down until this year. Once again, the budget process steamrolled over the constitutional deadline of 121 days. Yet again, the Legislature passed a last minute budget to keep the government doors open. And, in a repeat of 2019, the Legislative Council met within 24 hours of passing a get-out-of-town budget and paid lawmakers retroactively. 

Gov. Mike Dunleavy, in reviewing the budget before him, saw that Alaskans were, for another year, having their annual Permanent Fund dividends set by political bargaining rather than by law. The governor also noted the Legislature moved with excessive speed to pay itself before they boarded their planes and boats to return to their home districts.

Dunleavy threw down the gauntlet with his vetoes. After vetoing the entire PFD to bring the Legislature back to work on an amount that could be set in law, Dunleavy also vetoed the Legislature’s allocation for per diem in the budget for the year. The governor’s message was: “No per diem without a fair PFD payment. 

The reaction from many lawmakers was muted but furious. Only one, Sen. Bert Stedman of Sitka, made a public statement in opposition that foreshadows the fight to come, saying, “if there are going to be no rules (between branches of government) then there are no rules.” 

Per diem is back in the forefront, thanks to the State Officers Compensation Commission. Created to answer the question of how much to pay public officials in a more independent manner, the commission reviews the pay and per diem for the governor, lieutenant governor, commissioners, and lawmakers. 

The commission met this month and made several proposals on salary, including raising the pay for the governor, lieutenant governor, and commissioners. Dunleavy wrote the commission and declined the pay increase. 

Turning to lawmakers, the commission wanted to take on the per diem issue a certain way: Increase lawmakers pay but limit per diem. By the time the commission met a second time, however, there was a clear disagreement on moving forward. The commission is now considering simply capping legislative per diem. 

Like efforts before, the theory of capping per diem is simple: Get the work done in time, or there is a risk of incurring a cost. 

Dunleavy seems to have reiterated that point. When his budget was released last week for the upcoming session, it included a “fast track” supplemental bill for urgent items. Among the urgent items was a supplemental Permanent Fund dividend payment, and the vetoed amount of per diem. 

While Dunleavy’s budget was gathering the media attention, another meeting of the Legislative Council took place. One of the items to discuss was transferring money from elsewhere to pay lawmakers per diem retroactively for the fall special sessions since the funds were vetoed.

After debate, the motion to pay per diem failed by one vote: House Republican Leader Cathy Titlton’s no vote denied the Council the dight votes it needed. 

The Legislative Council will meet again before session, likely to take up the issue of retroactive per diem. 

In the meantime the State Officers Compensation Commission will finalize its pay recommendations, and submit those to the Legislature at the start of session. The recommendations cannot be amended: the Legislature will either accept what the commission proposes by not acting, or it will reject the entire recommendation in a vote from the House and Senate. 

The legislative session is scheduled to begin on Tuesday, Jan. 18.

25 COMMENTS

  1. Excellent article, Suzanne.

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    And don’t forget to mention the legislators who purchase homes in Juneau/Douglas for their use during session. These legislators use per diem, ostensibly, to pay off their mortgages. One lawmaker purchased a condo six years ago and that property is surely paid off by now using his outrageously high per diem. The longer he is in the legislator, the longer he pays nothing for housing in Juneau (except for CBJ property taxes). The added benefit of this tax-free per diem used to pay off legislators’ mortgages is that when these legislators sell their properties, they receive a tremendous amount of equity as an added, extra special financial benefit.

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    The bottom line is that state legislators are state employees. They should receive the exact same amount in per diem as ALL other state employees on temporary duty in Juneau.

    • Almost no other State employees on TDY to Juneau receive per diem; they get actual lodging expenses if they stay in commercial accommodations, a Meals and Incidental Expenses allowance that is a flat sum (it was $30/day when I retired in ’06, but if you had some extraordinary expense you could get reimbursed if you could justify it). There is a reduced allowance for non-commercial lodging, which we used to not so jokingly call “girlfriend pay.”

      The State basically gave up on the per diem system for regular State employees back in the Hickel Administration and went to actuals since with the growth of tourism, the rates varied so wildly from season to season; the room that an Anchorage hotel would beg me to take at $69-$89/nt. in January was $389 in July. In my time you had to have commissioner or governor’s office approval for over $300, and you’d best have a good reason. I don’t know how much auditing is done anymore; even in my time you generally had to be on somebody’s “bad boy” list to have anybody looking over your shoulder.

    • Legislators should receive full per diem for the first legislative session, half for the second & none for any session thereafter. Stop screwing around & get things done in the 1st session.

      • Yeah, the only way to end this new trend, where they do nothing until they have to call a special session, will only end when there is no financial motive to do so. The legislature’s per diem is way too much, also.

  2. I hope they vote down the retroactive Per diem. Plain and simple finish the work in the 121 day session or receive no additional pay for your failure. This year I will have to hold a new Senator or Representative accountable when they campaign since the reorganization of districts. I applaud my current Representative Cathy Tilton on her no vote.

  3. They claim they are “public servant” serving out of the goodness of their hearts. It’s a well paid job and with benefits. It serves a few and at minimum the general public interests.

  4. That “cash cow” has got to stop and the abuse from these legislators need to be brought under control. I say lower the perdiem and freeze their salaries for 4 years. Then we can get a handle on these poor decisions. I have seen first hand the abuse from them traveling 1st class and buying boats to stay in while in sessions. Just add up the numbers and you will see who is stealing from the people of Alaska. Go ahead, its public record, look into who made what over the last few years and you will be astonished!

  5. Growing their bank accounts on state per diem is another reason for term limits. Term limits was dutifully applied by voters against Cathy Giessel and John Coghill last year. And more coming!

  6. I love that the bilding looks dark, dank and uninhabited except possibly for some spectral haunting spirit. Cool…Nobiddy home…

  7. Excellent article, and very well written.

    The legislatures seem to be refusing to pass a budget just so that they can keep getting the per diem pay.

    I would suggest a constitutional amendment which says that if Congress cannot pass a budget within the 121 day session, then the budget which was approved and used by the state from 20 years ago will be the budget for that current year. Obviously the state could not operate on a budget from 20 years ago! However, such a mandate would surely force the legislatures to work on agreeing to a budget that would meet the needs of the state, without bending to the special interest groups! They would surely come to an agreement on and approve a budget well within the 121 days if they knew that the consequence would be a much smaller budget! This would solve two problems with one stone! A budget would be passed within the 121 days, and no extended per diems would be needed, unless for other not related to the budget.

    • If they refuse to pass the budget that the healthcare racket, the welfare racket, the education racket, and the unionized public employee racket want, they have fixed something.

  8. I hope all Alaskans remember the elected traitors in the next election, Walker, Giessel, and Stedman.
    I hope everyone reads this article, what a eye opener.

  9. Our legislature is supposed to be a citizen legislature, made up of common everyday folk and not professional politicians. I am not opposed to compensating the citizens in our legislature for the part time job they are volunteering for. I am opposed to turning a part time citizen legislature into full time well compensated career. Paying our citizen legislators an absurd daily per diem should cease immediately, but we should not reward them by raising their salary to offset the current absurd per diem while also padding their retirement accounts. If the compensation is moved from untaxed per diem to salary then the higher salary will be used to calculate future retirement benefits.

      • Article II section 8 of the Constitution of the State of Alaska says: “The legislature shall convene in regular session each year on the fourth Monday in January, but the month and day may be changed by law. The legislature shall adjourn from regular session no later than one hundred twenty consecutive calendar days from the date it convenes except that a regular session may be extended once for up to ten consecutive calendar days. An extension of the regular session requires the affirmative vote of at least two-thirds of the membership of each house of the legislature. The legislature shall adopt as part of the uniform rules of procedure deadlines for scheduling session work not inconsistent with provisions controlling the length of the session.” 120 days is 4 months, that’s a seasonal job at best.
        .
        Ballot Measure 1 was approved by a majority of voters in 2006, as such Alaska Statute 24.05.150.b says: “The legislature shall adjourn from a regular session within 90 consecutive calendar days, including the day the legislature first convenes in that regular session.” 90 days is 3 months, that’s barely a seasonal job at best.

  10. Nothing will happen until legitimate feds ( the non Comey type) do a full scale investigation of the rampant corruption in Alaska.

    In short, never.

  11. I would like to see more legislative sessions held in Anchorage, that would provide for more public participation and lower the per diem costs. Per diem should be limited to the State short term rate which is around $200, I believe the $30/day long term rate is for meals only and does not include lodging

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