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Alaska Legislature passes ‘compromise’ budget with over $3,200 in cash payments

Alaska Legislature passes 'compromise' budget with over $3,200 in cash payments
Published: May. 19, 2022 at 12:10 AM AKDT
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JUNEAU, Alaska (KTUU) - The Alaska Legislature passed a “compromise” budget in the final two hours of the legislative session that would deliver over $3,200 to each eligible Alaskan this year.

The Senate passed the budget on a 19-1 vote and the House of Representatives passed it 33-7, but the most dramatic vote was on the size of energy relief that would be received by Alaskans.

The House passed a budget with $2,500 in cash payments split between a $1,250 Permanent Fund dividend and a $1,300 energy relief check. The Senate’s budget passed with $5,500 in cash payments. The $3,800 figure has been pitched as a compromise: It has a 50-50 dividend and the same energy relief check.

Three quarters of the House and Senate needed to support drawing from a savings account to pay for half of the energy relief check. The Senate got the minimum 15 votes to do that but the House fell one vote short.

There was a second chance to vote on the size of the energy relief check to make it $1,300. Some last-minute arm twisting failed to get House legislators to the critical 30-vote threshold. A bill to implement new campaign contribution limits was part of the final debates, but it fell short. A new comprehensive reading and pre-kindergarten bill was also part of the equation, it narrowly passed.

Gov. Mike Dunleavy came out in support of the $3,800 figure on Wednesday afternoon after the Senate passed the budget but before the House held its final vote. He urged legislators to approve it, saying it would help Alaskans alleviate the burdens of high inflation and high energy prices.

Earlier in the day, Sen. Bert Stedman, R-Sitka, called the final budget bill a “compromise” with a big dividend, extra funding for schools, and major investments in deferred maintenance and for the Port of Alaska and the Port of Nome.

Fellow Wasilla Republican Sen. Mike Shower had been pushing for a full statutory dividend at $4,200, but he said the $3,800 check would make a big difference for Alaskans.

“This is life-changing. This is life-saving for some people,” Shower said.

Sen. Lora Reinbold, R-Eagle River, supported the Senate’s budget last week with a full PFD, but she voted against it on Wednesday after the dividend had been cut. She called the budget “bloated” with its spending on state services.

Wasilla Republican Rep. Chris Kurka, who is also running to be governor, voted “no” in the House, calling it a “giant” budget. He also opposed how negotiations led to Medicaid funding for abortions being restored unless the U.S. Supreme Court overturns Roe vs. Wade.

Apart from the cash payments, the budget has some other big-ticket items:

  • Almost $400 million would be appropriated to help repair the crumbling Port of Alaska and to expand the Port of Nome
  • The budget includes a maximum of $349 million to pay oil and tax credits owed to producers for a now-defunct program that was intended to increase production
  • There could be $2 billion in state savings accounts if oil prices stay high. Hundreds of millions of dollars is set to be deposited in the constitutionally protected part of the Permanent Fund
  • $300 million would go out to local governments to help pay for old school construction costs, which were vetoed by multiple governors
  • $359 million has been set aside to recapitalize the state’s college scholarship fund.
  • $57 million would be added to the per student school funding formula on a one-time basis and there would be $2 million in pre-kindergarten grants.

The budget will now head to the governor’s desk for his consideration, and possible line-item vetoes.

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