Gov. Sean Parnell said the law that bars him from appointing non-Alaskans to state regulatory agencies is unconstitutional and won't make him change his decision to put a Californian on the board that determines the tax value of the trans-Alaska pipeline.
Parnell's assertion that the appointment was "wholly lawful" came in a two-page letter Wednesday to Republican Sen. John Coghill, the Senate Majority Leader. Coghill questioned Parnell's decision to put business consultant Dennis Mandell on the State Assessment Review Board.
The appointment of Mandell, a former oil-company executive, is subject to legislative confirmation.
Parnell said the board is a special "quasi-judicial" panel. It weighs evidence and handles appeals from the pipeline owners who claim the value of the line is too high and municipalities that claim it's too low, much like a local board of equalization handles appeals from homeowners who believe their real estate was assessed too high -- and subject to a higher tax.
In recent years, the board came down much closer to the municipalities, resulting in millions of dollars in additional taxes from the pipeline's oil company owners. Last month, Parnell fired board chairman Marty McGee, the former Anchorage municipal assessor appointed to the board by Gov. Frank Murkowski in 2006, and replaced him with Mandell.
Parnell said he was only required to follow the Alaska Constitution's requirement that an appointee to a "regulatory or quasi-judicial agency" be a U.S. citizen, and not state law that mandates a person appointed to a "board or commission of the state government" also be a registered Alaska voter.
Parnell said a 1976 Supreme Court decision and minutes from the Alaska Constitutional Convention in 1956 "strongly suggests" the law is unconstitutional.
A spokeswoman for Parnell declined to answer a question from a reporter about whether the same logic applied to other regulatory and quasi-judicial boards and commissions, like the boards of game and fish, the Alaska Public Offices Commission, the Alcoholic Beverage Control Board and the many boards that license and regulate Alaska professionals.
Both the 1976 case and the decision by the delegates cited by Parnell involved the appointment of executive branch department heads, not members of boards.
Democratic Sen. Hollis French, the Senate minority leader and like Parnell an attorney, said the statute and the constitution were "in harmony," so the statute, which he said has been on the books since territorial days, is constitutional.
"If you can comply with both the Constitution and the statute in this case, go with it -- where's the conflict?" French said. "You hire U.S. citizens who live in Alaska and everybody's happy."
Responding to a story in the Daily News about Mandell's appointment, French took to the Senate floor Monday to ask Parnell to withdraw Mandell's name.
On Tuesday, at a news conference by Senate Republicans, Coghill, R-Fairbanks, said French "made a good point."
"Certainly if it comes to a place where an appointment doesn't fit the statutory qualifications, you're going to see the rest of us legislators squawk too," Coghill said Tuesday. "But I think the question was to the governor and we're waiting for him to give an answer."
On Wednesday, Coghill said he was taking Parnell's response "at face value" and hadn't studied the constitutional issue yet. As for the appointment, Coghill said that Parnell "will have to defend it politically, even if it's legal -- and it's going to be tough to defend."
French brushed aside Parnell's letter.
"What's shocking -- and I mean that, shocking -- is that the governor of the State of Alaska would be disregarding his own citizens, his own constituents, in favor of someone from Outside who wants to come here and tell us what to do," French said. "I don't see how that guy can hold all those thoughts in his head at the same time -- he hates it when some people come here and tell us what to do, but yet he'll drag them here and appoint them -- if they're from the oil industry."
What would have happened if Gov. Tony Knowles, the last Democrat in that office, had appointed an environmentalist from Berkeley, Calif., to the Board of Game, French asked.
"How many pallets would they have stacked against the Capitol before they set the place on fire?" he said.
The last decision on the trans-Alaska pipeline by the assessment review board was made in 2013, when it rejected the value set by the Alaska Department of Revenue as too low, ruling instead that it was worth $11.9 billion. The revenue department had assessed the line at $7.2 billion.
This year, the state assessment was even lower -- $5.6 billion. If Mandell and another Parnell appointee with an oil industry background get through the confirmation process, they'll constitute half the board when it hears the appeal of the municipalities with pipeline property inside their borders.
Reach Richard Mauer at email@example.com or 257-4345.
By RICHARD MAUER