House Majority response to budget: We don't like it - Must Read Alaska
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Tuesday, September 29, 2020
HomePoliticsHouse Majority response to budget: We don’t like it

House Majority response to budget: We don’t like it

Members of Alaska House Democrat-led Majority  released statements on the governor’s budget plan just hours after he had revealed his Fiscal Year 2021 spending plan on Wednesday, four days before the statutory deadline.

They didn’t thank him for bringing the plan to them early so they can get to work as appropriators. They didn’t applaud him for taking a different approach this year, after they crossed swords with him last year. Nor did they congratulate him on offering the Operating, Capital, Mental Health, and Supplemental budgets all at once, so they can see the gestalt of what they’re dealing with.

No, they didn’t have much nice to say about it, but at least the House Speaker was happy enough that the budget wasn’t as small as he expected it to be.

House Speaker Bryce Edgmon

“We agree with the governor’s decision to not further cut the budget. However, spending is only half of the budget, and the governor is deferring to the legislature on how to pay for it. Alaska cannot afford to delay tough decisions another year,” House Speaker Bryce Edgmon said.

Edgmon didn’t say what those tough decisions are, but he acknowledged the governor has given them a tough task in a year when the entire House is up for election. Presumably, Edgmon will favor taxes on income, oil, and Permanent Fund dividends.

Rep. Jennifer Johnston, co-chair Finance

“The governor’s proposal would drain the Constitutional Budget Reserve, leaving us unable to withstand any unforeseen financial emergencies. In the last year alone, we saw a record fire season and the largest earthquake since 1964. It would be reckless to drain our primary savings account for the largest PFD in history,” said Rep. Jennifer Johnston of Anchorage, who co-chairs House Finance. A Republican, she has joined the Democrat-led caucus. From her statement, it’s apparent she’ll propose a smaller draw from the Constitutional Budget Reserve, and half a Permanent Fund dividend for qualifying Alaskans.

Rep. Neal Foster, co-chair Finance

“The governor’s budget takes a short-term view. He is detailed about what he wants to spend but is shortsighted in his plan to pay for it. The legislature will hit the ground running in January, and we will work diligently with the administration to complete our work within 90 days,” said Rep. Neal Foster, a Nome Democrat.

Why did Foster say they would complete their work in 90 days? That’s a curious remark that has little to do with the budget or its funding. Last year, the legislative leaders predicted that 90 days was not achievable.

After all, the Legislature has not completed its work in the statutory timeframe since 2014, and the 2019 legislative session didn’t even attempt to meet the deadline.

Foster has tipped the hand of the Democrats, who want to complete their work in 90 days so that they can help the Recall Dunleavy group get onto a special election ballot. If they do gavel out in 90 days, and that’s a big “if,” the recall group will benefit greatly. They have a better chance of taking out the governor via a special election, which is only possible if the Legislature gets out of Juneau on time.

Clarification: The length of the legislative session can benefit the recall committee, depending on how they want to play it. When the recall committee turns in their signatures determines whether it gets attached to the General, Primary or a special election.

This is about politics, left vs. right. If the session goes longer than 90 days, the recall petitioners have more time collect signatures.

Unlike an initiative, which has regimented dates associated with it, if the Legislature adjourns on Day 90, the timeframe becomes whenever the court is done with their decision, whenever the group gets the 78,000 signatures, and whenever they plan strategically to turn in those signatures, because that begins the 30-day signature verification, and the lieutenant governor’ decision to set the election between 60-90 days after that. That window could bump the recall onto the Primary ballot. Or if they delay turning in their signatures, the question could go to the General Election ballot, something the group seeks to avoid. Statute directs the lieutenant governor to put it on the next ballot, if it falls in that timeframe.

Democrats, who control much of what goes on in the Legislature these days, will make a mad dash to get their work done within those 90 days.

Republicans, whose votes are needed to fund the budget with the Constitutional Budget Reserve, are likely to drag their feet in an attempt to rob the Recall Dunleavy camp of that victory.

There’s another reason why Democrats will try to get the budget finished in 90 days: Every one of the 40 House seats are up for election. The incumbents who are running again will not be able to raise money or effectively campaign if they are stuck in special session after special session, as they were in 2019.

In 2019, the Legislature met for 177 days, from January 15 through May 14, 2019, May 16 through June 13 and July 8 through Aug. 6. The incumbents cannot afford to have another year like 2019 if they want to fend of challengers.

The Alaska Senate didn’t issue a statement about the budget, nor did the Republican House Minority.

Alaska Democrats echoed the sentiments of the House Majority, not criticizing the size of the budget but the funding source:

“Smashing the piggy bank rather than repeal oil tax credits. His priority is clear, and it’s not the people of Alaska,” the Democrats offered, pointing to the source of money they want to use for state service.

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Suzanne Downing had careers in business and journalism before serving as the Director of Faith and Community-based Initiatives for Florida Gov. Jeb Bush and returning to Alaska to serve as speechwriter for Gov. Sean Parnell. Born on the Oregon coast, she moved to Alaska in 1969.

Latest comments

  • This is actually a good article that shows the politics behind the decisions. The House does want to end the session quickly, so the recall Dunleavy effort can proceed, and they can focus on re-election. Conversely, Dunleavy will want the Court to rule on the Recall, before he finalizes the Budget. (that was not said)

    That the House will want to trade our Dividends (half anyway) for money in Constitutional Budget Reserve is also the logical outcome. So, where will the cuts come from this coming session ? If the “flat” budget is not sustainable, and the Legislature is controlling the budget, it is incumbent on them to produce the solution. They will pay the cost politically, not Dunleavy, if the PFDs are the solution to balancing the budget.

    So, NO, they don’t like it. And the Mainstream Media can’t fault Dunleavy for draconian cuts either.

    • Dunleavy has already paid the price politically with the recall effort. And that effort is predominantly due to his insisting on those PFDs, requiring enormous cuts to budget.

      • Just terrible that he wants to do what’s right for Alaska

        • Yessir Cindy, but when the recall vote happens my prediction is he is voted out 60-40. And that’s after he has caved on much of his budget cuts.
          We’ll see, of course, but your “what’s right for Alaska” is most likely “what’s right for you.”
          Big difference IMO.

          • Are you talking 60-40 in the echo chamber that is Juneau, or statewide? If you think a recall vote even happens, let alone that it’s 60-40 statewide you need to get out more Bill.

          • Just my prediction Four-Flusher. And that’s statewide. By the time it gets to a vote my guess is that his base will most likely be voting him out, too. Heheh!

          • Dream on, ‘Bill Yankee’. Gov. Dunleavy won’t get recalled out of office, and President Trump won’t get impeached out of office. You leftists live in your own fantasy land.

      • Leaving the statuory forumula in place has nothing to do with budget cuts that is all on the Legislature in putting in place the POMV law.

        • POMV law was passed before Dunleavy was Gov. His budget cuts were to make it possible to fund statutory PFDs, along with his idea of paying back the PFD money already taken by earlier Legislatures.

    • Alaska’s public service unions, ACLU, special interest groups and self-serving personal agendas are why the rich get richer and we Alaskans continue to pay for their lifestyle.

      We have to live within our means, and so should the Legislature. We Alaskans can no longer afford the Alaska State Legislature.

  • The RINO budget isnt quite RINO enough for these Juneau swamp creatures.

  • These legislative crooks are still playing politics. They simply don’t like our governor, and will reject anything and everything which comes from his office, regardless of wheter it is the will of the people or the will be good of all.

  • Get rid of the oil tax welfare system for big oil and institute a fair income tax of around 3 percent…then we can move forward and start to solve Alaska’s problems…oil has peaked in AK and future revenue streams are necessary at this point.

    • You seem to forget that oil companies provide thousands of jobs in Alaska, contribute millions of dollars to our economy, and provide funding to social programs within the state. The oil tax credits they receive is not welfare, but rather serves as an incentive for them to produce oil in a state where it is incredibly expensive to produce. Furthermore an income tax is not the solution. You don’t tax the backs of the working middle class to fund the needs of the state. If you want a tax that will bring in funds try a small sales tax to help bring in revenue. Additionally the marijuana industry rakes in millions of dollars in taxes that can go towards funding various programs.

      • A small income tax would hardly be a problem for the working middle class in Alaska Anne. On the other hand, neither would be a much larger income tax as long as it had tax credits for PFD money lost from the Statutory Formula. Such a tax would get at non-residents without harming Alaskans.

        • Who do you tax when working class is gone and they will leave.

          • Of course the working class remains in how many states with an income tax? Why would they leave if the jobs remain? I understand the large income earners are opposed to this-for example the former head of GCI was paid well over 1million/year.
            Are you surprised he was in favor of giving up his PFD, rather than an income tax. Of course you want to include him in your working class? Heheh!

    • If any tax is implemented needs to be a sales tax not income. All Alaskans should bear the brunt of the big government if they want it because when your working class leave who are you going to tax then?

      • A sales tax: a) doesn’t really deal with the out of state workers who, say, work on a fishing boat the entire time they are here at leave the state with the money b) it’s regressive, the family trying to scrape by on 20K a year can’t afford even a few dollars more — a fair income tax wouldn’t hit people living at the edges c) could drive more people to order online to avoid taxes.
        _
        My preferences in order: oil, (fair) income, Amazon, property

    • The failed Walker Administration tried to push an income tax. An income tax in a state with the extraordinarily small working population we have is nothing more than a form of punishment for the working class. Plenty of states have an income tax and if you want to go to one of those you are free to do so…ain’t America great!
      .
      People have been talking about peak oil for a long time, and the peakers are still wrong. It’s just silly that adults with the ability to find out any and all information with a simple push of a button are still clinging to the peak oil talking points, silly.

    • Good suggestions. A fair tax wouldn’t hit any PFD eligible person making under 40K. Tax out of state workers off all income levels.

      • How about a Voluntary Income Tax? All of you people interested in an income tax have the ability to send a check to the Alaska Department of Revenue every time you get paid. Write a check for 3%, 10% or any amount you think is needed to be qualified as a fair tax. You can surrender your PFD every year to the state government to help them with their spending habits. Let your money do the talking. Pay up.

        • Amen to that. But they never will. Leftists like to tell all of us how to live, and then they go about doing the “it’s really all about me” lifestyle.

    • No such thing as a “fair income tax”, when one realizes the proportion of Alaskans, non-profits, and Native corporations who’ll not pay a dime of it;
      .
      when one realizes the public-sector union-management teams will have their pay raises in place so, efffectively, they’ll not pay a dime of it;
      .
      when one realizes the Alaska Municipal League stashes $630M in their “investment pool”, safely out of taxpayers’ reach, while helping local governments figure out how to… you guessed it… get more tax revenue;
      .
      when one realizes the oil business keeps our little third-world dictatorship afloat and annoying that business is akin to killing the goose that laid the golden egg, which we better not do because after the Exodus, there won’t be enough productive Alaskans left to support our lobbyist-legislator team in the style to which they believes they are entitled.
      .
      Happened in the 80’s, can’t happen now on a bigger scale?
      .
      Someone gets cancer, the doctor moves forward by giving him more cancer, more of the same poison that caused his cancer?
      .
      Our lobbyist-legislator team spends us into oblivion, so we solve the problem, move forward by… giving them more money?
      .
      Maybe stiffing productive Alaskans with an income tax, and say, a ten or twelve percent sales tax might be just what it takes to create an Exodus, a show-stopping recession, a major political house cleaning…
      .
      and your Nobel Prize in Economics.
      .
      It could happen.

  • “They didn’t thank him for bringing the plan to them early.” Thanks Big Mike! Your hissy fits are precious…

    • Hussy fits. Are you happy you’ve been noticed

  • Mike Dunleavy has lost his compass. This budget is not leadership, it’s a cop out. As a Conservative Republican it’s hard to watch this incompetent administration from the top down, collapse into their own footprint.

  • The state has lost thousands of residents so the budget should go down. Same for the school districts. See any patterns here like the left wants and wants and wants until the well is dry. We had better come up with a good working plan soon or we all will be on welfare. This state has a spending problem so the best thing is to vote out everyone in Juneau and start from scratch so nobody has the upper hand and we can quit the child games being played. Vote for the common non business or special interests related people. The old ways have got us to this point and how happy we are now. Clean the playing field and give us hope instead of the business as usual.

  • Mike Dunleavy is true north as a conservative. To say otherwise is stupid. The route to a smaller balanced sustainable budget can take various paths – the proposed FY21 budget is a smart strategy. Remain flat, draw from savings, force the opposition to provide pathway through new taxes or further cuts.

    Cuts to the PFD are the most regressive tax on those with lowest incomes, which happen to be core Democratic voters. That is the first line of thinking for wealthy Democratic leadership.

    Let them lead for this session.

    If you can’t see the strategy, don’t pretend to be offended by the Governor’s approach this year.

  • As treasurer of the Recall Dunleavy campaign, I must correct your assertion regarding the Democrats’ motive for wanting to finish the legislative session on time. Unlike an initiative, a recall election is in NO WAY affected by the timing of the legislature’s adjournment. Instead, it is entirely dependent on two things:

    1. the date on which the second round of signatures is validated AND
    2. the number of days until the next statewide election.

    From AS 15.45.650:

    “ … the director shall prepare the ballot and shall call a special election to be held on a date not less than 60, nor more than 90, days after the date that notification is given that the petition was properly filed. If a primary or general election is to be held not less than 60, nor more than 90, days after the date that notification is given that the petition was properly filed, the special election shall be held on the date of the primary or general election.”

    So, unlike an initiative which must be on a Primary or General Election ballot, a recall issue may trigger a Special Election.

    In the interest of keeping your readers well-informed, you should issue a correction.

  • Income tax is out bring in sales tax and everyone pays even the leach’s that refuse to work and live off the welfare system or I should say extort the state welfare system. Drug dealers theives working class all pay tourists also flat sales tax!!! AK Democrats have already broke the state.

    • Everyone will -not- pay a sales tax.
      .
      Think about exemptions that’ll crop up like weeds.
      .
      Native corporations, non-profits, anybody who’s poverty stricken or can simulate poverty will be exempt.
      .
      Why you give more money to somebody who’s desperate to spend every damned dollar he has?
      .
      Sympathy for a doper running low on dope… just want to rush out and get him more dope?

  • Thank you

  • No one has a greater understanding of this political conundrum than me.
    There is only one way out. The same way we got in: Income tax versus the Dividend.
    It became apparent in 1980 that the State could not maintain a State income tax while paying for the Dividend.
    Thus we need to end or reform the Dividend before we ever talk about taxes.
    Its that simple.
    I have some suggestions as to how we could do that.

    • Final Dividend would be double current dividend or approximately the statuary formula. = $3200.
      The following year a small income tax (5% of federal tax liability) would start.
      The Dividend will be reformed into a tax exempt/deferred individual trust account.
      A longer termed investment to achieve greater public benefits.

    • Chris, the State (under Hammond) lost the income tax, not because of the dividend because it hadn’t even started yet. It lost the income tax because there was never any attempt to drop the rate to close to zero. I happened to work for Revenue at the time and the only argument the Administration had for keeping it was that it provided good income data. The Oil money was flooding the State with money that made the personal income tax unneeded.

  • All the pro income tax folks simply whistle past the graveyard while advocating taking the rewards of peoples labor. Those pushing for taking from working people still claim to be advocating on behalf of these same people, the Democrat party and those associated with the same agenda are not friends with the working class. Under the failed Walker Administration a “modest” income tax was proposed, it amounted to around 2-3% of the budget or 7 to 10 days of spending out of 365…a week to a week and a half at best. So while some are fine running off those who work for a living in an effort to continue overspending, this is a short sighted and narrow plan that only ends in further taxation. Taxing the income of the small pool of those earning an income in Alaska is counter productive as it will lead to fewer people earning an income and fewer taxes from those workers. Simply put it’s a plan only an idiot would support.

    • (I’ll regret this)
      .
      Explain this to me: “Those pushing for taking from working people still claim to be advocating on behalf of these same people”
      .
      If I want a tax that only applies to people making over, say, 40K how am I targeting working people?
      .
      Sincerely interested in your answer, not trying to start a fight.

      • In order to answer your question, I need to ask one of you to clarify your question. Are you suggesting people making over 40k are not working people or just that you are not an advocate for people making over 40k?

        • I’m saying we need to be able to tax people in way that doesn’t remove food from anyone’s table. If you are living a subsistence lifestyle a tax shouldn’t impact you.
          _
          I’m saying that 40K seems like a good number. Someone making 45K can afford to pay about 3 percent of their income over 40 so we can have roads, PFD, ferries, schools, pioneer homes etc. So if you make 45K you get taxed on 5K and pay 150 year. Someone making 100K would pay $1800.
          _
          I think this would help working people because they then don’t need to pay to educate their kids, they don’t need to pay for road building, snow removal, street lights, police . . .

          • I understand you want to tax people and how that tax money would be spent, well for a week or a week and a half anyways. You still sound like you are suggesting that people making over 40k are not working people.
            .
            When you asked “If I want a tax that only applies to people making over, say, 40K how am I targeting working people?” Do you understand that people making more than 40k are working people? From what you keep writing it appears that you do not understand that. If you do understand that people making more than 40k are working people and you wish to tax them then you are targeting working people and you’ve already answered your own question.
            .
            I don’t understand your last point where you think that working people don’t need to pay for anything, but I suppose that stems from the misunderstanding about what working people are and how it’s somehow related to an income of 40k.
            .
            A sales tax with a food exemption would do much more than an income tax that would impact a small percentage of the population and do little more than punish those who are responsible for keeping our economy going.

  • Throw some more wood on the fire. Keep feeding the monster and see what happens. Dunleavy should be impeached for quid pro quo. “Vote for me and you can keep your P.F.D.”

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