Governor adds budget bill to special session agenda amid threats legislators would leave

ANCHORAGE, Alaska (KTUU) - Gov. Mike Dunleavy has added a budget bill to the special session agenda, allowing legislators to pass a Permanent Fund dividend for this year.

The governor’s bill would pay a roughly $2,350 dividend, following his 50-50 PFD plan. It would also restore scholarship funding for Alaska college students after an annual three-quarter vote failed in the House of Representatives in June.

Dunleavy had kept the 2021 dividend off the special session call as a deliberate “phased approach.” After “significant progress” had been made to pass a fiscal plan, Dunleavy said he would add the dividend to the agenda.

The governor’s approach had frustrated some legislators.

House Speaker Louise Stutes, a Kodiak Republican, wrote to the governor on Monday asking that a budget bill be added to the session’s agenda. There were threats that legislators would end the session early if that didn’t happen.

“Holding the PFD and other essential programs hostage while we work towards a solution is unconscionable and counterproductive to compromise,” the letter from Stutes reads.

She welcomed the addition of a spending bill to the agenda, saying it gives the Legislature the “tools to get the job done.”

“We’re committed to working toward a resolution on every proposal that has consensus as we continue to seek a compromise that will end Alaska’s structural budget deficit once and for all,” Stutes said through a prepared statement.

Dunleavy vetoed funding for this year’s dividend on June 30. Unless new funding is approved, Alaskans will not receive a dividend in October. Some legislators also want to use a budget bill to restore funding to spending areas vetoed by the governor.

“Alaskans are still in recovery mode from the economic impacts of the pandemic,” Dunleavy said through a prepared statement. “With this in mind, and following recent encouraging conversations with legislators, my administration has put forth a vehicle for the legislature to fund the PFD and student scholarships — two critical programs that directly impact Alaskans.”

Members of the House Republican minority caucus were frustrated on Thursday at the lack of progress in Juneau.

“We’re essentially doing nothing,” said Rep. Kevin McCabe, R-Big Lake. “The minority has been here, all 18 of us for five days or six days, and we haven’t done a thing.”

The House of Representatives has held one floor session since convening on Monday. The Senate has held two and one committee hearing.

Rep. Cathy Tilton, R-Wasilla, explained a concern of adding a budget bill to the special session agenda is that legislators will only focus on this year’s dividend and budget. The long-term future of the PFD may only get a cursory look, she said.

A bipartisan working group released its recommendations for how to solve the state’s fiscal crisis. It calls for the Legislature to work toward the 50-50 dividend supported by the governor, perhaps over years.

The recommendations also include new revenues to pay for it and the budget, most likely by a broad-based tax.

Dunleavy applauded the working group’s progress to come up with “thoughtful solutions” that would act as a starting point for debates.

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