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Alaska House votes to avert a state government shutdown

The exterior of the Alaska State Capitol in Juneau, Alaska.
The exterior of the Alaska State Capitol in Juneau, Alaska.(KTUU)
Published: Jun. 28, 2021 at 1:05 PM AKDT|Updated: Jun. 28, 2021 at 2:23 PM AKDT
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JUNEAU, Alaska (KTUU) - The Alaska House of Representatives narrowly passed a procedural vote on Monday to avert a state government shutdown.

Under the Alaska Constitution, a bill only becomes effective 90 days after it’s signed by the governor. Two-thirds of the House and Senate needed to change that for the budget so that state funds could be disbursed on July 1, the start of the next fiscal year.

The Senate changed the effective date of the budget two weeks ago, but the House didn’t.

The House fixed the effective date issue by a 28-10 vote on Monday. Twenty-seven members were needed to reach the supermajority threshold. All 10 no votes were from the House Republican minority caucus.

Republican Gov. Mike Dunleavy called the budget “defective” on June 17 and said he couldn’t sign it unless its effective date was changed. Some legislators said the governor’s position was not valid and that he was using the procedural issue as a bargaining chip for a larger Permanent Fund dividend.

On Monday, the governor’s office released a statement saying state funds could now be disbursed on time.

“Once I receive the budget, and review individual items, I will make a decision on possible line item vetoes and prepare the budget for implementation on July 1,“ Dunleavy said.

A second special session began last Wednesday to resolve the impasse, just over one week before a state government shutdown was set to begin. The Dunleavy administration released a list of potential shutdown impacts that included stopping a monthly allowance for low-income seniors and the closure of Division of Motor Vehicles offices.

Wasilla GOP Rep. Cathy Tilton, the House minority leader, said the 18-member Republican House minority caucus was holding out voting for the effective date change to deliver a permanent fiscal plan.

A tentative deal was forged on Friday afternoon, but details of it were not released publicly. As part of the deal, the House passed a resolution on Monday, creating a working group to help forge a permanent fiscal plan during another special session later in the year.

Members of the bicameral and bipartisan working group have not been named, but that is expected soon. A similar working group was created two years ago to try and end the dividend debates. None of its recommendations were implemented by the Legislature.

Some parts of the budget remain unresolved. A separate three-quarter vote was needed to stop dozens of state accounts from being emptied on July 1, including one that helps reduce power bills in rural Alaska and another that provides scholarships for Alaska college students.

Passing that three-quarter vote would also double the 2021 Permanent Fund dividend from $525 and fund projects across the Matanuska-Susitna Borough, but the House resolution pledges to untie that funding plan. That three-quarter vote failed in both the House and the Senate.

Some members of the House Republican minority caucus have said holding back that three-quarter vote helps ensure that they have leverage during upcoming fiscal debates.

Editor’s note: This article has been updated with additional information.

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