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Alaska House budget vote stalls over $5,500 cash payments and deficit concerns

Closed-door discussions are taking place on whether the House will vote to pass the Senate's big spending budget to the governor.
Published: May. 12, 2022 at 7:43 PM AKDT
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JUNEAU, Alaska (KTUU) - The Alaska House of Representatives has been busy debating behind closed doors whether to pass the Senate’s big spending budget onto Gov. Mike Dunleavy’s desk.

The House had been scheduled to debate that on Wednesday evening, but that vote got delayed until Thursday morning, and then delayed again until Friday at the earliest. The House is required to convene a floor session by Sunday at the latest.

The Senate’s budget has over $5,500 in cash payments to each Alaskan at a cost of over $3.6 billion, and almost $400 million invested in two big infrastructure projections: The Port of Alaska and the Port of Nome.

Legislators are set to get an updated fiscal picture on Friday, but the Senate’s budget passed with a deficit of almost $1 billion that would need to be covered by state savings accounts. If oil prices drop, those accounts could be drained.

Sen. Bert Stedman, R-Sitka, manages the operating budget in the Senate. He voted to pass the Senate’s budget, but he wants the House to reject it. He said “something is seriously wrong” if the budget is not balanced with crude oil prices over $100 a barrel.

It was widely believed that the House would reject the Senate’s budget changes, and a conference committee would be called. The committee would be in charge of negotiating the differences between the House and Senate’s budgets so a single bill could pass through both chambers. But it would only take a simple majority of 21 legislators to vote to concur with the Senate’s budget changes and pass the bill.

Several members of the bipartisan House majority coalition representing rural districts signaled that they would likely join House Republicans from the minority in voting to concur with the Senate’s budget changes. The crucial vote in the House was delayed to prevent that from happening.

Rep. Adam Wool, D-Fairbanks, said the wait could allow tensions to drop and for some legislators to consider changing their votes.

On Thursday, it was a waiting game for most legislators in the state Capitol. There were closed-door discussions between legislative leaders and the governor, and rumors that Dunleavy had pledged to veto a $1,300 energy relief check and other spending to reduce the Senate’s budget by $1 billion. Several legislators said the goal of that is to bolster savings accounts and encourage fiscally conservative House Republicans to pass the Senate’s budget.

Jeff Turner, a spokesperson for the governor’s office, didn’t respond to a request to comment on those rumored deals, but he said in a prepared statement that “the Governor is meeting with lawmakers from all four caucuses on the budget. He is committed to working with lawmakers on a spending plan that can receive legislative approval by May 18, the constitutional deadline for this year’s legislative session.”

Some members of the Republican House minority caucus are enthusiastically supportive of passing the Senate’s budget as a way to deliver a full statutory Permanent Fund dividend. Supporters say that would help during a period of high inflation and high energy prices.

“I usually do not announce how I’m going to vote, but I’m ready to vote on concurrence so we can ensure that Alaskans are getting money directly into their hands,” said Rep. Sarah Vance, R-Homer.

Rep. Zack Fields, D-Anchorage, is urging the House to reject the Senate’s budget and continue budget negotiations. The Senate’s budget would wipe out a bicameral plan to fund schools a year ahead of time. Fields claimed that the governor has been bullying legislators to support passing the Senate’s budget with secret deals.

“I think it’s outrageous that the governor would sacrifice Alaskans’ fiscal health — our education, our public safety — for a campaign trick,” Fields said.

Since Sunday, legislative staff have been meeting to do background work for a conference committee if one is called. Stedman said a lot of that committee’s work is about “cleaning up the budget” and making technical fixes. He added that legislators are sharply aware of the time pressures facing legislators, and that the committee could work quickly.

The Legislative Finance Division said an operating budget conference committee has been called every year in the past 50 years, except in 1982. Rep. Neal Foster, D-Nome, manages the operating budget in the House. He said this stalled budget situation may be “unique,” but the current end-of-session anxiety levels are similar to every other year.

The legislative session must end by midnight of May 18.

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