Must Read Alaska curated a few of the comments from senators on the Finance Committee as they discussed the House’s version of the operating budget today, with the guidance of the Legislature’s Finance Division Director David Teal:
Sen. Lyman Hoffman: “The underlying theme of the House of Representatives budget is that government gets the first crack at the $3 billion and anything remaining after government goes to the people. Is that a fair statement of the way this budget has been drafted?”
David Teal: “Mr. Chairman, I’m not sure that everyone would phrase it that way but that’s pretty accurate.”
Sen. Natasha von Imhof: “The dividend is sort of the 18th agency and competes with the 17 other agencies. I look at this: There are no new taxes, about $200 million or so in reductions, no money from any savings accounts at all — no SBR (Statutory Budget Reserve), no CBR (Constitutional Budget Reserve). Those are kind of observations.”
David Teal: “All correct observations.”
Sen. Peter Micciche: “To be fair there’s a couple ways to frame this discussion. The governor’s plan requires new taxes. But it’s paid locally instead of to the state. For folks that own a piece of property or that live in municipalities that have to make up the difference, it requires new taxes.
“To also be fair, The House budget impacts household income because of the shift from the dividend to State government. Both of them have those impacts. So it’s not like either one is impact free. For the folks who feel they’re entitled to the dividend, they’re going to be enraged by our discussion, that we make it sound like there’s no impact. But they have to be clear on the other side, that the governor’s plan requires revenue, but it looks like it’s not State revenue. It looks like they’re claiming there’s no requirement for state revenue but it’s made up elsewhere.”
Sen. von Imhof: “With the dividend potentially being considered the 18th agency, some states have an income tax and this causes citizens to pay attention to the growth of government. Alaska has the dividend, which kind of does the same thing. It has Alaskans now really paying attention to the growth of government because as passing of the POMV with the dividend being paid out of that as well as government, the dividend sort of acts as almost the same thing as a tax. It causes people to pay attention to the growth of government. Alaska is slowly morphing into the new POMV age, which I think is a good thing. The dividend is yes, competing with the other agencies.”
Sen. Hoffman: The House of Representatives did not include a dividend in their operating budget. They have not determined what that dividend is. There’s been many statements by the individual members of the House of Representatives, but the House as a body has not taken action on any dividend level. The public should be aware that even though we have a graph in quadrant one, and the scenario for the House of Representatives, there is no official action by that body.”
David Teal: “They [the House] passed budget without a dividend.The governor submitted a separate dividend bill. And they said ‘We will address the dividend in that bill. That’s the way the governor submitted the budget to us.’ That decision has not been made. The underlying conceptual assumption is this is how much is left for dividends. That doesn’t necessarily mean that that’s what the House’s dividend plan is.”
The Senate Finance Committee will take up crime bills Wednesday, considering the governor’s bills SB 32 and SB 35, and will continue its budget work on Thursday with another presentation and question and answer period with David Teal.