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Bryce Edgmon becomes Speaker: 21 to 18

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By a vote of 21-18, Rep. Bryce Edgmon has become Speaker of the House of Representatives.

The Republicans who voted in favor of the Democrat-turned-undeclared Speaker were Anchorage Reps. Chuck Kopp and Jennifer Johnston.

Rep. Gary Knopp of Kenai had left town, dodging the vote. Democrats voted to allow him an excused absence.

[Read: New power group forms for Edgmon as Speaker]

Republicans Gabrielle LeDoux and Louise Stutes also voted for Edgmon, but these votes were expected, as the two are in lockstep with Democrats.

Kopp said on the floor that it was time for the House to organize, and he indicated that Speaker Edgmon was the only apparent way forward to break the impasse.

Rep. DeLena Johnson of Palmer nominated Rep. Dave Talerico, a Healy Republican, but with a motion on the floor to vote on Edgmon, she was not able to move an actual motion to vote on Talerico.

Tuck spoke on behalf of his motion to vote on Edgmon, saying Edgmon was a fair and quiet leader, and said that he had been a good Speaker during the past two years.

[Read: Edgmon reregisters as undeclared]

Rep. Jennifer Johnston said she was following the words of the late Sen. Ted Stevens, who said, “To hell with politics, just do what’s right for Alaska.”

Edgmon appointed a Committee on Committees to form up the leadership on committees, and that included himself as chair, Chuck Kopp, Steve Thompson, Neal Foster, Tammie Wilson, Jennifer Johnston, and Louise Stutes. The committee is made up of three Democrats — Edgmon, Foster, and registered Republican Louise Stutes, who caucuses with the Democrats, and four Republicans — Kopp, Thompson, Wilson, and Johnston.

They will come up with a Rules chair and the other committee leadership appointments. The House took a recess so that work can be completed.

[This story will be updated]

Opposition groups react to budget: ‘State of despair’

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THE FIGHT OVER SCARCE DOLLARS BEGINS

The governor’s budget had no sooner been released, when 30 union members, led in song by AFL-CIO President Vince Beltrami, swarmed the Third Floor of the Capitol, in front of the Governor’s Office, singing the old Pete Seeger union organizing song:

Oh workers can you stand it?
Oh tell me how you can.
Will you be a lousy scab
Or will you be a man?

Which side are you on, boys, which side are you on?

Watch the AFL-CIO video here.

Union members from various shops roamed the floors of the Capitol, going into each lawmaker’s office and asking them or their staffs, point blank, “Which side are you on?”

Outside the Capitol, a group of education, climate, and health care advocates, along with several Democrat lawmakers, stood in protest. Spotted were House members Andi Story of Juneau, Zack Fields (Anchorage union worker in his other job), and Grier Hopkins of Fairbanks.

The press releases went out from the Democrats:

Sen. Donny Olson issued a statement, calling the governor’s budget a declaration of war on rural Alaska. “It’s one of those things where it appears to me that he’s declaring war on rural residents in particular,” said the Golovin Democrat.

“It is quite clear that Governor Dunleavy does not take his job and our state’s Constitution seriously. The trend he is setting for the state is evident; strip public assets to fill private pockets. This is unacceptable, and quite frankly a dereliction of his constitutional duties,” said Sen. Tom Begich, and Anchorage Democrat. “The Senate Democrats will continue to work across party lines to build a proper budget that rebuilds safe communities, provides a world-class Pre-K through UA system, and delivers access to quality, affordable healthcare.”

“Governor Dunleavy is declaring war on seniors, kids, and the most vulnerable among us while holding harmless the most profitable companies in the world. Cutting Senior Benefits, education, and healthcare while increasing his own budget and not touching $1.9 billion in oil tax credits shows where his priorities lie, and it is not with Alaska,” said Sen. Bill Wielechowski, an Anchorage Democrat.

“Governor Dunleavy continues to ignore the cause of over 90 percent of crime in Alaska. Solely locking people up and throwing away the key is not the fiscally prudent answer. Substance abuse treatment and mental health services, combined with a strong education system, are the key to rebuilding safe communities and saving the state money for the long-term. Continuing to paralyze public safety with significant cuts to Troopers and VPSOs, who are the first line of defense for thousands of Alaskans, shows his lack of understanding of rural Alaska needs. If the Governor’s goal is to create more criminals, then this budget succeeds at that,” said Sen. Scott Kawasaki, a Fairbanks Democrat.

“Alaskans should be shocked not only at the debilitating budget cuts to education, health and social services, transportation, and the university, but at the callous disregard shown by the governor and his Outside budget director as to how these cuts affect the lives of people who live here,” said Jay Parmley, executive director of the Alaska Democratic Party. “Alaskans have the right to expect constitutionally mandated adequate education for our children, a high-quality university system, a Health and Social Services department that is equipped to care for Alaskans in need, and a transportation system that serves the unique needs of our state.”

Anchorage Mayor Ethan Berkowitz was also ready:

“We’re gonna fight this. We’re gonna make sure that as many improvements can be made, as should be made, because this is not who we are. I am confident that the people of the state of Alaska are gonna rise to the occasion. This budget represents an attack on who we are. It represents an attack on individual Alaskans, on Alaskan families, on Alaskan communities, on Alaskan businesses. And we have, as we showed in the earthquake, demonstrated an ability to come together in order to combat adversity. This is adversity.

The Alaska State Hospital and Nursing Home Association sent out a blistering statement, calling the budget “outrageous,” and said it will lead to “a state of despair for the future.”

New power group forms in House: Speaker vote tomorrow

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EDGMON TO RETURN AS SPEAKER

Rep. Bryce Edgmon has told people in his district that since he’s switched over from Democrat to undeclared, he’s been able to gain enough votes to emerge as Speaker in the House organization.

He’s bringing over Anchorage Reps. Jennifer Johnston, Cathy Tilton, Tammie Wilson, [this information is incorrect, according to Wilson] and Chuck Kopp to an organization that involves power sharing between Democrats and Republicans.

The Republicans will have the majority on the leadership team: Majority leader, Finance, Vice Chair of Finance, Rules, and majority seats on the Finance Committee as well as majority on all committees.  It will be a co-chair situation so nothing goes out of committee without both co-chairs agreeing.

It’s a fiscal caucus, Must Read Alaska has learned, built on policy, built on a budget that is within projected revenues with a structured draw of the Permanent Fund, and will not raid any fund balances or savings, including the dividend.

If Alaskans want more services, people will have to accept a smaller dividend. The caucus forming is taking a very serious look at the Governor’s proposed budget.

The House Democrats didn’t show up for work today, although all Republicans did, with the exception of Gabrielle Ledoux and Louise Stutes, who caucus with the Democrats, and Gary Knopp, who headed home to Kenai to appear on a morning radio show and attend a Chamber of Commerce meeting and a town hall.

Knopp won’t be there to vote on Thursday, but will be part of the new organization, Must Read Alaska has learned. When he returns to Kenai, he’ll be greeted by protesters, some who are coming in from around Southcentral Alaska on Friday.

The House has voted four times for Speaker, but always ended with a 20-20 split. House Republicans who are joining this power-sharing caucus believe this is the only way forward.

Giving Edgmon the Speaker’s gavel effectively gives the Democrats one seat on the five-member redistricting board, something Republicans are opposed to.

Those Republicans who don’t join the caucus may be sitting it out, but they’re going to have weekly meetings with the governor, Must Read Alaska has learned tonight.

[This is a developing story. Check back for updates.]

Judge rules Rogoff must pay Hopfinger legal fees

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(3-minute read) ROGUE PUBLISHER LOSES AGAIN IN COURT

A judge has ruled that former Alaska Dispatch News publisher Alice Rogoff must pay 75 percent of her former business partner’s legal fees, after he won in court a $852,752 judgment against her for a contract written on a bar napkin that was signed by the former newspaper owner in 2014.

Hopfinger is entitled to $191,334 in attorney fees, Judge Andrew Guidi wrote in a decision filed today.

“The facts are fairly simple,” the judge started in his two-page decision.

Rogoff had tried to convince the court to allow her to pay just 15 percent of Hopfinger’s legal fees, or $28,749.66.

But Guidi, in his writing, appeared incredulous.

He said the paltry sum could not be taken seriously “as it is literally invented out of thin air. And its credibility is not enhanced by the feigned precision of carrying the figure out two decimal places. Rogoff’s rationale appears to be that, in spite of the amount of the jury’s verdict and the language of Rule 68 Hopfinger did not prevail. In the court’s view, this is entirely incorrect.”

RULING DOC- ALICE ROGOFF TO PAY LEGAL FEES

“Rogoff does find several minor instances in which the fees charged can be nitpicked,” the judge allowed, “but Rogoff doesn’t challenge the reasonableness of the hourly rates nor suggest that the overall amount billed for over two years of litigation and a two-week trial is unreasonable.”

Tony Hopfinger

Hopfinger and his former partner Amanda Coyne started the online news organization Alaska Dispatch News. They brought Rogoff in as an investor and majority owner. Coyne left, and Hopfinger stayed on until the relationship between he and Rogoff soured, as she purchased the Anchorage Daily News and merged the operations, against the advice of Hopfinger.

When he wanted out, he could never pin her down on the terms of the agreement for her to buy his share, until during one spat between them, she wrote a contract offering him $1 million over 10 yearly payments.

The contract was written in her own hand on a paper napkin. She told Hopfinger to “show this to the judge if I don’t ever pay you.”

Hopfinger did so after she stop making payments after the first $100,000 installment.

Rogoff has since filed for bankruptcy, sold the entire operation to the current owners of the Anchorage Daily News, and has continued publishing with a new online entity she calls Arctic Today.

Hopfinger hasn’t quite been made whole. He’s suffered a great deal of opportunity cost since he first filed a lawsuit against her in 2016. He likely had tens of thousands of dollars in attorneys fees that he paid for before the lawsuit was filed, and since the lawsuit was concluded, and these could reasonably add up to $90,000. Those are fees he can’t recover from Rogoff.

And now, he’ll be on the hook for 25 percent of the legal fees that grew once the lawsuit was filed. All those will eat into the $852,752 that he won in the judgment.

Rogoff has had other court cases, and she’s lost and settled most of them.

She settled with GCI for $1.5 million in back rent that her collapsed media empire owed to him, and she settled with Arctic Partners for an unknown amount.

She still is fighting with M&M Wiring over money the company claims she owes for electrical work done on behalf of her and the now bankrupt news organization.

Other companies have simply walked away, knowing it would cost more to recover their outstanding receivables than they would ever be likely to get from her.

Rogoff’s own legal fees fighting Hopfinger are estimated to be twice or three times what he spent, which could mean that she’s spent $650,000 or more fighting to not pay the $852,257 the court says she clearly owes Hopfinger. Her other court fees are estimated to reach more than $1 million.

Even the judge appeared irritated that she would “nitpick” some of Hopfinger’s legal bills, considering her vast wealth and influence.

[Read: Rogoff vs. reporters: Outtakes from oral arguments]

[Read: The summer of Alice Rogoff’s discontent]

 

 

Breaking: Jack Coghill, ‘Mr. Republican,’ passes

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HE SIGNED THE STATE CONSTITUTION

John B. “Jack” Coghill, former lieutenant governor of Alaska, has passed. He was 93 years old.

Coghill was a political leader who was witness to and participant in some of the most dramatic events of Alaska’s short history, including Statehood. He was one of the last surviving authors and signers of the Alaska State Constitution.

Born Sept. 25, 1925, Coghill was a businessman who served as lieutenant governor from 1990 to 1994 with Gov. Walker Hickel. He had run as a Republican, but he didn’t abide the views of his running mate Arliss Sturgulewski. He switched over to join Hickel on the Alaska Independence Party, and the two of them denied Sturgulewski a Republican victory. They then governed as Republicans.

Coghill was mayor of Nenana for 22 years and served in both the territorial and state Legislature. He was elected to the territorial House in 1952  and 1956, representing the 4th District, which at the time was Interior and Southwestern Alaska. After Statehood, he was a senator in the first three Alaska Legislatures. He then chose not to run in 1964, but later he was again elected to the Senate in 1984-1990, when he became lieutenant governor.

Born in Fairbanks and educated in Nenana public schools, Coghill was elected to Alaska’s constitutional convention, serving as one of the “55 Club,” the 55 who wrote the Constitution in 55 days, and his personal copy of the Alaska Constitution is on display in Constitution Hall on the University of Alaska Fairbanks campus.

The only remaining signer of the Alaska Constitution is Vic Fischer.

Jack Coghill, Constitutional Convention photo

CONSTITUTIONAL CONVENTION SPEECH

In a speech given on the 48th day of the Constitutional Convention, Coghill spoke on behalf of public education and an education tax:

“I believe that the way our government was set up 175 years ago, that the founders felt that public education was necessary to bring about a form of educating the whole child for civic benefit through a division of point of the home taking a certain part of the child, the church taking a certain part of this education, and the government or state through public schools taking the other part. I adhere to that principle… I think that sectarianism segregation in our educational system is bad for the children. I do not deny the right of people to have their own schools. However, I think that we should always look to the interest of the founders of our nation when they brought about the separation of church and state. The problem was brought, and it was brought about by Thomas Jefferson quite well when he said, ‘If a nation expects to be ignorant and free in the state of civilization, it expects something that never shall be.’ Therefore out of his deliberations with James Madison they brought about a form of free public education starting in Virginia, and it has come forward ever since under the intent of having the tax dollar only brought to the public educational system.”

Public offices and organizations held by Coghill include:

  • Territorial House of Representatives – 1953-57
  • State Senate – 1959-65, 1984-90
  • Mayor, City of Nenana – 1962-85
  • Lieutenant Governor – 1990-94
  • Nenana City Council
  • Veterans of Foreign Wars

Coghill was often referred to in Alaska political circles as “Mr. Republican.”

[This story will be updated]

Dunleavy budget reduces education, Medicaid, ferries, and much more

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FERRY SYSTEM TOO COSTLY TO RUN AS CURRENTLY OPERATED

The top takeaway from the 2020 budget proposal by the Dunleavy Administration, which was rolled out today, include consolidations and efficiencies, and also the elimination of major programs:

Overall, state spending would be $4.6 billion, which is $1.6 billion less than the budget presented in December by former Gov. Bill Walker.

Education: $280 million reduction to the base student allocation. The BSA would be reduced by $1,100 per student, going from $5,900 to $4,880. Only 50 percent of state dollars goes into classrooms now, and the other 50 percent is used for school administration.

Medicaid: $270 million in cuts. The Department of Health and Social Services is in the process of negotiating with the Centers for Medicaid and Medicare Services for greater percent federal reimbursement for many services. CMS has visited Alaska and met with DHSS Commissioner Adam Crum about restructuring. Some of the reductions will come with reduced reimbursement rates. Alaska reimburses at a higher rate than any other state in the country. There is no proposal to eliminate coverage for any population.

Ferries: $98 million. Alaska Marine Highway System takes a 65 percent cut. Service would remain through October of this year, and a marine consultant would be contracted to come up with a divestiture plan. Currently, the state subsidizes each passenger’s ferry mile with $4.58 of public money, whereas road miles only require 2 cents per mile subsidy. 2018 passenger capacity was 42.6 percent and 51.6 percent for vehicle capacity.

University: $155 million reduction in general funds. The Board of Regents will be asked to restructure, possibly focusing on research at the Fairbanks campus, and teaching at the Anchorage campus. University of Alaska Southeast would be a hub for the community college level, and $20 million will be added in for community campuses, such as Ketchikan and Kenai. The idea is to return them to the community college model.

Corrections: $32 million reduction. Save $12.8 million by moving some long-sentenced prisoners out of state. Save another $6 million by closing a wing at Wildwood. Inmate cost in Alaska is $168 per day. 500 sentenced inmates would be sent out of state.

North Slope Borough Special Tax: The Dunleavy Administration seeks to repeal a law that gives over $400 million in property taxes from the Trans Alaska Pipeline to the North Slope Borough. That money would go into the General Fund. The North Slope Borough is awash in money and has five years of reserves, enough time for new oil to come from the Willow and Greater Moose’s Tooth fields, as well as the National Petroleum Reserve Alaska. The borough has about 9,000 residents.

Alcohol and Marijuana Control Board: Repeal board and have the Department of Commerce manage the issues.

State Council on Arts and Humanities: Repeal.

Public Broadcasting: Zero out the $3.4 million funds.

Revolving loan funds: Eliminate all but commercial fisheries.

Student loans: Eliminate program.

WAMI program: Eliminate program.

Live Homework Help: Eliminate.

Best Beginning Program: Eliminate.

Early Childhood and Pre-K: Eliminate.

Curriculum Fund: Repeal.

Power Cost Equalization: Eliminate special fund and roll into General Fund, then give out to communities. The program is not reduced, but the special fund is eliminated. This will be a multi-year effort to look at every designated fund established by statute and determine if that dedication should be repealed. Intended to increase the flexibility of state budgeting and decrease stakeholders having their own fund.

Pioneer Homes: Raise rates to cover cost of service. New customers will pay actual costs. Current residents will be grandfathered in. Payment assistance program will be put in place for current residents, based on need. Intent is no one removed from homes.

State Human Resources and Procurement: Consolidate all departments’ HR and procurement . Put under Department of Administration.

Investigators: State’s over 100 investigators — for everything from fraud, crime, to environment, moved to Department of Law as part of a new statewide investigative unit.

Travel: Reduce state travel budget by 50 percent across departments.

Public Safety: No increases to troopers at this time, since the unit has 40 unfilled positions. The reduction to Walker’s proposed increase is due to no additional trooper positions until Public Safety fills its existing vacancies.

Actual Personnel Reduction: Over 620 State positions eliminated, plus 320 in the ferry system.

Alaska Oil and Gas Conservation Commission: Moves to Department of of Commerce from Department of Administration.

Rural Airports: Reduce number of public airports owned or funded by the State, especially air strips where there is 0 population.

Property Disposal: Possible sale of some of the 1,800 structures it owns.

Exempt positions: Some fully exempt employees would be placed into partially exempt services and placed on salary schedules. This will be done through an “Exempt Position Reform Bill,” capping exempt job salaries at $300,000. Creation of exempt positions would be subject to approval of the Office of Management and Budget.

Permanent Fund Dividend: The funds for paying the Permanent Fund dividend is a separate appropriation bill. The governor does not see this as an appropriation, so it is not part of the proposed operating budget.

This story will be updated. Check back.

The Big Reveal: Budget built from bottom up

THE BUDGET WILL ARRIVE WHILE HOUSE IS IN DISARRAY

When legislators receive the governor’s budget on Wednesday morning, all bets are off for organizing the House of Representatives.

Even though it will be Day 30 of a House without a Speaker or committees, it’s going to be every legislator for himself and herself.

There will be so much to digest in the completely revamped budget that Republicans in the House will look disorganized and unprepared on their messaging. They won’t be able to speak with one voice.

Democrats, on the other hand, already have their press releases ready, and they’ll say that the Dunleavy budget is the meanest budget ever to be proposed. They’re ready for war over the budget. This is why they played Rep. Gary Knopp for the past few weeks, while ensuring that Republicans dithered away their chance to be a united force.

[Read: When you come to Juneau, the only thing you have is your word.]

The budget will be $4.6 billion, which is $1.6 billion less than Gov. Bill Walker’s proposed budget. It is a 28 percent smaller budget than the Walker budget.

This can only mean an entire restructuring of government, and many, many programs will be lopped off in the process. It’s a return to a budget the size that Alaska had 14 years ago. Back to basics.

Each of those soon-to-end programs has a constituent. Each constituent comes with an organized trade association, a lobbyist, and a strategy — however strong or weak — for keeping itself from the grim budget reaper.

Public broadcasting? It’s got a big and noisy constituency. But no more so than education, and no more so than Medicaid. The noisy competing interests will descend, and at times be very loud.

“What we’re doing with this administration is we are building a budget from the bottom up, from zero up. We’re going to build that up to where we reach our revenues,” Dunleavy said.

The Dunleavy Administration didn’t start by cutting. Instead, it started with core ideas about what government should fund and how much money is available to fund it:

  • funding cannot exceed existing revenue;
  • the focus should be on core functions that impact a majority of Alaskans;
  • state reserves must be protected;
  • no taxes on Alaskans and no taking their Permanent Fund dividends;
  • government should be sustainable, predictable and affordable.

Under the current revenue that is expected, government will do less in the future, because it has less money. The only money available, beyond current oil revenues and the Permanent Fund structured draw, is through taxes or the Permanent Fund. Dunleavy doesn’t want to use either of those.

“You’re going to see a whole slew of different approaches to not just budgeting but in services and what can we do as [the] state of Alaska in terms of enlisting the private sector,” he said. 

Health care, which was a main focus of Gov. Bill Walker’s tenure, did not make the list of what government should guarantee. The Medicaid program will likely be dramatically transformed, and shrunk. One in four Alaskans uses Medicaid, but it’s a program that has no cap, which means it tends to expand continuously, lacking any incentive to be more efficient.

Medicaid is also prone toward fraud. Fraud, waste and abuse account for about 10 percent of the payments made by Medicaid, which equates to millions of Medicaid dollars annually being fraudulently billed in Alaska.

The  budget focus is on public safety, education, management of resources, and infrastructure.

Where the private sector can pick up services, that’s the “open for business” part:

Ferries are expected to be dramatically trimmed, opening up major opportunities for private carriers around Alaska’s coastal cities to fill in where publicly subsidized ferries have prevented private sector enterprises.

Services for seniors may need to be privatized. This opens up business opportunities, once government is not filling the need. Prisoners may need to be sent out of state, where it doesn’t cost as much to house and feed them.

The governor has already said he is not going to propose taxes to patch the hole. He’s not proposing to take more from the Permanent Fund.

“I believe government is best if it’s kept small and focused and out of the lives of people. That’s what I truly believe,” he said.

WHAT HAPPENS NEXT

This process is a discussion and the governor will open up that discussion on Wednesday at 10:30 am, during his press conference.

The Legislature will likely want something different when they see the budget on Wednesday.

Each of the 60 legislators will have an opinion about what to add back into the budget. They will not bring their red pen to the budget, but many of them will bring a list of must haves:

  • Coastal legislators will will say that the Alaska Marine Highway System can’t be eliminated.
  • The Fairbanks legislators will say the University of Alaska budget can’t be  smaller.
  • Public school advocates will say that education funding must not only be preserved, but grown.

All stakeholders will be fighting to grow the budget back, and all will be lobbying in the halls of the Capitol.

This will occur at the same time the House is attempting to organize with a Speaker, Rules Chair, Majority Leader, and Finance Chairs, something the House has been unable to do for 30 days.

The result of the organization that ensues may be that no caucus will form that does not require caucus members to vote as a group on the budget.

More likely, over the weekend a group of legislators who simply oppose the budget will form up as an opposition caucus to add dollars back. They’ll just struggle to answer the question: “Where do you plan on coming up with the money?”

Gov. Dunleavy goes on Twitter to discuss House dysfunction

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Gov. Michael Dunleavy took to Twitter tonight to remind the House Republicans and Alaskans as a whole that Alaskans voted in a Republican House, a Republican Senate, and a Republican governor, and that voters expect a change in the House from the way it was run over the past two years.

“Elections have consequences, & the majority of Alaskans have chosen conservatives in , and expect a republican led majority. With the budget coming out tomorrow and the house absent from work for the last month, it’s time to get to work and do the people’s business,” Dunleavy wrote.

For the past 30 days, the House of Representatives has not had a leader, and Tuesday afternoon, Republicans caucused, while  plans were also under way to return Democrat Bryce Edgmon as Speaker, as he was over the past two years of Democrat control.

Only now, Edgmon has reregistered as an “undeclared” with either party, in order to make his leadership more palatable to Republicans.

It’s unusual for a governor to weigh in on the organization of the House or Senate, perhaps an indication that Dunleavy has run out of patience on the eve of his budget release.

Bryce Edgmon reregisters as ‘Undeclared’

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EDGMON MAKING PLAY FOR SPEAKER’S GAVEL

Lifelong Democrat Rep. Bryce Edgmon of Dillingham quietly reregistered as an “undeclared” yesterday, Division of Elections records show.

It may be part of a plan Democrats and three Republicans are hatching to nominate him as Speaker of the House, allowing him to return for another two-year term.

Today, two Speaker nominees were turned down by House members. Republican Dave Talerico failed on a 20-20 vote, and then Republican-in-name-only Gary Knopp, who has flipped to work with the Democrats, also failed to get the votes.

With the Republican side in disarray today, Edgmon’s change of party status appears to be the next move to organizing the House.

Edgmon is said to have consulted with Democrats in his heavily partisan district, and won their nod of approval to change his party in order to build a bipartisan coalition.

His official page at the Alaska Legislature still lists him as a Democrat.