Will the Senate president release CARES funds to communities soon?

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GIESSEL’S POWER PLAY WITH THE GOVERNOR

The State of Alaska has received the $1.25 billion in CARES Act money. Now comes the question about how to get it out to the communities and citizens to help them recover from the economic disaster created by the government shutdown.

The governor has submitted his plan to the Legislative Budget and Audit Committee, and asked for an expeditious review so the money can quickly be disbursed.  Nearly half of the CARES money for Alaska will go straight to local governments, if Gov. Mike Dunleavy can prevail in what is a developing power struggle over a large pot of money.

Senate President Cathy Giessel appears to have alternate plans than the governor’s plans for distributing the funds.

In a message to her constituents this week, Giessel made it clear that she intends to not only control the appropriation of federal disaster relief funds that have come to the State of Alaska through the CARES Act, but she is in charge of disbursing those funds — a power that is in actuality reserved for the Executive Branch.

“As the Senate President, I have been working with my leadership team to prepare to disperse (sic) those funds as quickly, widely and appropriately as possible to citizens, businesses and communities around our state,” Giessel wrote.

Gov. Dunleavy, in the meantime, has already been working the dispersal plan through Legislative Budget & Audit, since all he needs is “receipt authority” and there are no matching state funds to be appropriated.

“Given the urgent timing of this response, I am requesting your approval of these items by April 29, 2020 so that distributions can begin on May 1, 2020,” Dunleavy wrote to LB&A Chairman Chris Tuck.

Included in his request:

  • Direct municipal relief: $562,500,000
  • Small business relief: $300,000,000
  • Education: $48,000,000
  • Agriculture: $5,000,000
  • Economic stimulus for Alaska fisheries: $100,000,000
  • Public safety: $3,585,351
  • Transportation, capital items: $29,000,000
  • Airports and aviation: $49,000,000
  • Whittier Access and Tunnel: $3,034,100\
  • University of Alaska: $5,000,000

Giessel and her leadership team evidently don’t believe that the Legislative Budget & Audit has the authority to appropriate the funds. It’s possible that Giessel and House Speaker Bryce Edgmon will call the Legislature back to Juneau on May 4 for a special session.

The Legislature cannot meet remotely to try to steer the funds elsewhere because Giessel and House Speaker Bryce Edgmon refused to allow a rule change to be voted on that would have allowed the Legislature to meet telephonically.

However, Sen. Bert Stedman has said that the Legislature would convene by teleconference, and then vote to change the rules to make teleconferencing legal. Whether that can stand legal muster has been a subject of debate among legislators.

Earlier this month, Giessel and Senate Finance Co-Chair Natasha von Imhof wrote a letter to the U.S. Secretary of the Treasury Robert Mnuchin, asking him for guidance on “What the Governor of Alaska is Not Allowed to Use the $1.25 Billion CARES Act Funds For.”

Specifically, the duo wanted to know if the governor could used the CARES Act funds to pay for items he vetoed in the Legislature’s budget.

The letter, and its pointed questions, was never answered by the Treasury Secretary, but the leaking of the letter to the media indicates there will be a power struggle over the CARES money. It may take longer to get the funds out of the Legislature’s hands and into the communities, businesses, and individual Alaskans who need help now. Here’s the letter:


40 COMMENTS

  1. 500 plus million to communities is a lot of money and Anchorage, with over 40% of the population should get a large share. Tourism businesses, bars and restaurants and personal care businesses (gyms, salons, etc.) have been devastated by the forced shutdown. It will be interesting to see how our local leaders allocate these funds. I know many businesses are not interested in increasing their debt.

  2. Well as I said yesterday the dis-functional leadership and their group of children that support them could not possibly stay out of screwing with the Governor and anything he try’s to do to help the State citizens. They have repeatedly do everything they can to prevent him from helping the citizens and show their utter contempt for Alaskans. Get the hell out of the Governor’s way and let him disburse the Federal funds to help all Alaskans. Everything thing you attempt to do shows your contempt of not just the Governor but the majority of Alaskans. Alaskans can’t wait for you to hold your temper tantrums for two or three months while you collect undeserved per diem to supplement your income.

  3. The Governor disperses through the LB&A as they are the receipt authority! Governor Dunleavy is asking for approval by April 29th as the governor want to start dispersing by May 1st. Giessel is not the dispersal authority. Stand tall Governor, President Trump is with you.

  4. Governor Dunleavy is the dispersal authority, period. Giessel, Edgmon, Von Imhof and Stedman are in need of some professional help.

  5. When will the governor grow a pair and stand up to these power hungry leeches of government? If there has ever been a time to wave the flag it is now. Let’s see how many Alaskans want this current spend it all an I am in charge or the governor is in charge and we are broke. This is the perfect storm to cut the government cord to 50 % of the state employees and programs not needed and did not exist years ago and we still got by. Come on governor, make a stand now.

    • Unfortunately you’re right and it should be done sooner as it will have to be done later. What part of we can’t afford the government we’re paying for are you the legislators not getting? Cuts need to start there. Pay perks and per diems.

  6. …….not until the governor lowers the rate for lockdown patients in the Pioneer Homes. Giessel will NOT pay the rate imposed by the Administration, as it conflicts with her family inheritance arrangements.
    ps. Prediction: Giessel won’t get past the Republican Primary in her district. Expect an all out effort to dump this tyrant.

    • Here’s Hoping. (I don’t live in her district ~ but for this reason alone, to vote her OUT, I wish I did. For no other reason, would I live in the cesspool of the state.)

    • I have a friend who knows Giessel from many years ago. She tells me that Giessel has a pure authoritarian side to her that has been noticeable since Giessel’s early nursing days. The sudden rise to power as Senate President has put her conduct into overdrive. She is bossy. She is defiant. And she is hell-bent to get even with anyone who crosses her, or questions her motives. Her mom and dad were staunch union Democrats from Fairbanks. Her mom even ran for state-wide political office, but never won a seat. From what I have heard through reliable sources, even her own family considers her power drunk and self-righteous. She is not to be a trusted ally to other Republicans. For Giessel, it’s all about power and control. She needs to be defeated this fall.

    • TJ, you are correct. I copy and pasted it from her newsletter and didn’t even notice it. – sd

      • There is a bit of comic gold in the difference. Be still, my mind. Who needs banks when money cannons are available. ;>{)

  7. Write to the US Attorney, DOJ for oversight of the monies coming in. Let them have the investigative issues and questions along with the FBI. It would do us all good to see how many of the cruddy legislature persons get charged, starting with Stedman and Giessel.

  8. I get it now!!! The Legislature wants to go back into session not to distribute the CARES funds (which it doesn’t have authority to do…)… but to have the 5 days to try to override the governor’s vetoes!!! Not surprisingly, the press hasn’t reported this!!!

    • They have not adjourned they are still technically in session and being paid as if in session and cannot legally hold any meeting via electronically due to the constitution. Mike Showers and a few others tried to change this with a SB but were overrode by the Majorities. They want to stay in session and get paid to do nothing!!!

  9. Somebody needs to knock those two horrible women, off their high horse. Quickly and efficiently. Anchorage – are you up to it? Or are you just another Seattle, Portland, San Francisco, NYC wanna be place? Come on, right-leaning voters, wake up and vote. Get rid of these women!

  10. Let me try to unravel this. I don’t know who is advising Mike Dunleavy, but I’m sure glad it isn’t me. Let’s do some Government 100; this is the remedial course. The fundament of State financial management is that any State expenditure must be supported by a Legislative appropriation and appropriations must originate in the House of Representatives. Federal revenue is just like any other revenue; it comes to the State and in order to be expended by the State must be appropriated by the Legislature to the Executive Branch for expenditure. As Sarah Palin once famously said, the trouble with federal money is that it comes with strings; that was one of the things she was right about. The strings on the CARES money are that it must be spent for specific and fairly closely defined purposes. So, while the Legislature can appropriate the CARES money, it can only appropriate it to the purpose set out in the enabling legislation. The purpose set out in the CARES legislation is to meet expenses incurred specifically for dealing with the COVID-19 epidemic.

    It pains me, because I’m no fan of Nurse Ratched, but the right is more on her side here. The Legislative Budget and Audit process that the Administration is trying to use was once called a “RPL, or Revised Program – Legislation.” It is illegal to move money between appropriations; money can only be spent for the program to which it was appropriated by the Legislature. There are exigent circumstances in which the Executive Branch has money in some program that it wants to use for some other purpose. Within economic limits, the Executive can submit an RPL to LB&A to seek permission to move money between appropriations to change the purpose of the expenditure. My wife, a former State Finance Officer and Administrative Services Manager says that the State has always used LB&A to direct federal funds, but it’s one of those “we always did it that way” justifications. The predicate for here was whether there was an authorization for expenditure of federal funds. The issue is whether it is appropriate to this circumstance.

    The essential factual predicate is that there isn’t an appropriation for which the Administration can seek LB&A approval to change the purpose of the expenditure. In the simplest terms, Gov. Dunleavy cannot just decide where he wants to spend the CARES money and he can’t just decide to spend it to fill his veto holes; from what I’ve read the law is very restrictive about states using CARES money to bail themselves out. See, Mitch McConnell’s rather ominous advice to some Blue states to seek bankruptcy protection.

    On the other hand, Nurse Ratched can’t use her power or the House’s appropriation power to just spread the CARES money out to the three rackets that own them, the union racket, the education racket, and the healthcare racket. The money has to be expended for the purpose set out in the federal enabling legislation, not for the whims of Alaska legislators or an Alaska governor, and, no, President Trump isn’t going to commit ritual hari-kari to help out the Governor of a State with three Electoral votes that are going to him no matter what. At minimum, this peeing contest is a two or three year trim to the Alaska Supreme Court while Alaska suffers.

    No matter who wins this peeing contest, and based on the past my money would be on Nurse Ratched, if that federal money isn’t pretty scrupulously spent exactly as the enabling legislation prescribes, some Alaska fund managers and elected officials are going to be spending some “quality time” with federal auditors and maybe US Attorneys, and the already broke State is going to be trying to figure out how to pay the money back.

    • Not sure what to make of Nurse Ratched’s newfound respect for law and order…
      .
      Could it be that even Nurse Ratched knows federal auditors can’t be dismissed with the same contempt Nurse R. normally reserves for Alaska voters because auditors may ask why CARES funds should be distributed to communities who are members of the $600M Alaska Municipal League or communities like Anchorage who, according to Jim Crawford’s exposes, have billions of dollars stashed in their own rainy-day funds?
      .
      Must be a cui bono in here somewhere. Maybe it takes the state going bankrupt to find, which in itself does not seem like a bad outcome.

    • I get the Nurse Ratched at the federal level. Don’t we also have a real Nurse Ratched here in the Alaska Senate (Prez)?

      • Citizen, you must refer, as do we all, to Peoples Imperial State Senate President and Co-Governor Giessel with the greatest respect.

  11. Any one wanting a clear understanding of Alaska’s budget process can refer to a manual produced by Alaska Legislative Finance Division called a “Swiss Army Knife Guide to Budgets.” Art, just to clarify, it is the governor who is required by Alaska’s Constitution to produce a budget prior to the legislature meeting.

    That budget identifies the appropriations by way of several bills including a Capital, Operating, and several other less-broad appropriation bills.

    Annually this takes place with the Capital budget starting work in the Senate, while the Operating starts in the House. They are then passed to the opposite body for its review.

    This process is what we hope provides balance. Yes, both bodies have to vote on and pass the appropriation bills (with any changes they make). But the House does not start the process.

    As to receipt authority for federal funds, The Department of Transportation historically has been the most successful in bending the wording. I would agree with you on consequence for wrong headed opportunists who might think to do their own will with fed funds. As always we appreciate your thoughts.

    • Rex, I worked for one or the other Finance Committee for three sessions and helped build my division’s piece of many Governor’s Budgets, so I kinda’ know my way around that process. By the late Nineties I’d gotten far enough up the org chart that I could have somebody else do the work and I only had to know enough to ask questions and sign the thing, so my detailed knowledge is dated. I only was involved in a couple of RP-Ls and it was a long time ago, so I don’t know today’s rules; most of the rules died in the Knowles Administration’s “anything goes” days anyway.

      Anyway, the Constitution hasn’t been amended nor has the EBA and no matter what the current practice might be in a government that has lost most of its organizational culture and institutional memory, the Constitution still requires that appropriation bills originate in the House, and the Governor’s Budget doesn’t become an appropriation bill until it is introduced as one in the House.

  12. 48 million bucks for education – WTF! Teachers & administrators have been getting paid throughout this fiasco. If anything the primary education system should be kicking some bucks back to the State & Boroughs!

    • I don’t think they should be giving any money back because by keeping people on payroll, to cover lunches at home aka MRE’s, and distance learning, they still have bills to pay. I’m not sure what losses they have had, but I’m not in the business office. Might be a lobby thing.

  13. Petty and poorly written letter from the most corrupt legislature in the country. They are so concerned with undermining the governor they would rather send this money back to the feds. Madness. These people are beyond reprehensible. This really is a new low, for a group of people I did not think could sink lower. That they are corrupt? We have known this. That would sell out Alaskans for special interests and to keep their seats- we have known this too. Just how petty they could be? Staggering.

  14. I’m losing faith in Mike. He doesn’t seem to own a pair. I’m ultra conservative, which means I have thermometer for tepidness from a leader. He is soft. I’m not ready to jump over the fence. Hell will have to freeze over first, but I am ready for a strong conservative to give the house majority the whatfor. Nurse Cathy is just a paid spy or turncoat. She shouldn’t even be there.

  15. Uh, folks………that would be “madame Senate President, practical nurse Ratched.”
    .
    We are organizing behind the scenes to get this kookoo senator away from our state government ……. forever.

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