JUNEAU — A deal to close out this year's 90-day legislative session on time appeared to be slipping from lawmakers' grasp Friday, with leaders saying they remain in a stalemate over an oil tax and tax credits bill.
"It's not moving," said Anchorage Rep. Chris Tuck, the Democratic minority leader, though he added: "It's not dead."
The legislation, House Bill 247, has been stuck for two days in the rules committee, with Republican leaders saying the measure doesn't have the votes to pass. There are no hearings scheduled on the bill, and with the session set to end midnight Sunday, Tuck on Friday pegged the chances of an on-time adjournment at 1 percent.
Closed-door discussions on HB 247 are still going on around the Capitol, said House Speaker Mike Chenault, R-Nikiski, "to see if we can come up with an idea nobody's thought of yet — some way to get everybody off of dead center."
But the apparent deadlock is looking more and more like last year, when it took Tuck, Chenault, and Senate President Kevin Meyer, R-Anchorage, nearly two extra months to negotiate a session-ending deal.
Tuck's caucus, with 13 of the House's 40 members, has the power to block state spending from the $8 billion Constitutional Budget Reserve, a savings account that will likely be needed to cover the state's multibillion-dollar budget deficit. And Democrats are not expected to give their approval until Republicans give them an oil tax bill that makes sharper cuts to cash subsidies to small companies, projected at $775 million next year.
"They're soliciting us for the CBR. We're waiting to see what they come up with," Tuck said. "They've got to make us an offer that we're going to like."
The oil tax dispute has largely left the Senate on the sidelines, since that chamber's 16-member Republican-led majority can spend money from the savings account without negotiating concessions from Democrats.
"If it was just up to us, I'd say absolutely: We'd be done," Meyer said in an interview Friday. "We'd be fishing by Monday."
The Senate will ultimately have to approve any deal struck by the House on oil tax credits, but Meyer said he's confident his chamber could pass a reform bill.
HB 247 is just one piece of a sprawling deficit-reduction plan proposed by Gov. Bill Walker that lawmakers are considering in the final days of the session.
Other bills include one to restructure the $52 billion Alaska Permanent Fund to generate billions of dollars for government services, reducing Alaskans' dividends in the process. There's also legislation to institute a small state tax on personal income, increase taxes on motor fuel, mining and commercial fishing, and to set a state spending plan that's sharply reduced from last year.
"I think they've got a tougher job than any Legislature I've ever seen," said Sam Cotten, Walker's commissioner for the Department of Fish and Game, and a former Democratic House Speaker.
Those other pieces of legislation made little headway Friday, with hearings postponed because of a lengthy joint House-Senate session for confirmation votes on Walker's appointees.
Even if there was time, lawmakers said they're not ready to vote on the Permanent Fund legislation or the other tax measures until the oil tax fight is over.
"It's hard for folks to vote on revenue measures without a tax plan being in place," Chenault said. "If it gets unstuck, then I think we plot a path forward."
Chenault wouldn't, however, describe his plan for unsticking the bill other than making a general reference to discussions underway. Tuck, the minority leader, said he hadn't talked to Chenault about oil taxes in the last "few days," adding it was the speaker's responsibility to come to a consensus within the Republican-led majority.
"We're just letting things settle right now," Tuck said. "But I can tell you that we're united on our side. It's on his side that he needs to get everybody lined up."
The oil tax fight centers on cash subsidies the state pays to small oil and gas companies, particularly in Cook Inlet. Total payments are projected at $775 million next year, which includes $200 million Walker vetoed from this year's budget that's now coming due.
Walker says the subsidies — some of which were aimed at combating a feared natural gas shortfall in Southcentral Alaska — are unsustainable with oil prices blowing a $4 billion hole in the state's budget.
As originally proposed by Walker, HB 247 would have generated a combined $830 million in cuts and new tax revenue in 2018 and 2019.
But the House's Republican-led majority reduced the impact of the legislation, with members saying they didn't want to jeopardize Alaska's investment in oil development — revenue from which has traditionally paid the vast majority of the state's bills.
The impact of the current version of HB 247, adopted by the finance committee and amended on the House floor, is projected at no more than $200 million over the same two-year period.
Democrats say those savings are too small if they're being asked to approve taxes — and cuts to education and health programs and Alaskans' PFDs.
"How are we supposed to go to our constituents and ask for them to pay taxes if we're just going to go right around and shell out oil and gas tax credits, cash?" said Rep. Scott Kawasaki, D-Fairbanks.
Several lawmakers Friday seemed resigned to the need for an extended session to resolve the oil tax dispute, though Chenault said: "We're still trying to get out of here on time."
He acknowledged, however, he has no tickets home yet. One lobbyist said she's been postponing her flight back to Anchorage on a daily basis, while others in the Capitol have reservations for the end of the month — just before the building is scheduled to close for renovations.
While the pace might seem slow, Alaskans should be patient, said Joelle Hall, the political director for the state's largest labor group, the Alaska AFL-CIO.
"I know it's easy to get impatient," she said in an interview at the Capitol. But the issues before the Legislature, she added, are some of "the biggest policy decisions we've made since statehood."
Correction: Due to an editing error, an earlier version of this story incorrectly stated that the Senate Republican majority cannot spend money from the Constitutional Budget Reserve without negotiating with Democrats.