Gov. Sean Parnell submitted a plan to federal energy officials Wednesday on how to spend what may be the state's most controversial $28.2 million -- stimulus money that his predecessor, Sarah Palin, rejected before resigning in July.
Under Parnell's plan, much of the stimulus funding would go toward energy-efficiency improvements in schools and government buildings. His administration's proposal also identifies a way for the state to turn the $28 million into roughly $86 million by tapping the state's credit line or issuing bonds that would be repaid with savings realized by the efficiency upgrades.
The proposal was due Wednesday to the U.S. Department of Energy, which will have to sign off on it before providing the funding to Alaska. A Parnell spokeswoman did not return a call Wednesday.
Earlier this year, Palin and some other Republican governors denounced President Obama's federal stimulus package, cautioning against growing state government, increasing the national debt, and claiming some of the funding came with conditions, or what she called "strings attached." Palin's refusal to accept nearly $300 million of the roughly $930 million allocated to Alaska caused contention between her and legislators, and the argument consumed much of the session in spring.
Lawmakers passed a bill accepting Alaska's entire share, but Palin vetoed the $28 million. Legislators then voted to override her decision in a special session in August, just weeks after Palin resigned.
In the Parnell administration's plan, the only string is that Alaska must "strongly encourage" adoption of energy-efficient building codes for future construction and retrofits, said Alaska Housing Finance Corp. spokesman Bryan Butcher. The spending plan includes $150,000 toward that effort.
On Wednesday, lawmakers on both sides of the aisle praised the plan and expressed relief that the debate was over.
"It's the end of a really long hard fight -- a stupid one," said House Minority Leader Rep. Beth Kerttula, a Juneau Democrat whose caucus pushed hard for acceptance of the funds. "I'm really glad it's over and this money is going out where it should be."
Rep. Mike Hawker, R-Anchorage and House Finance Committee co-chairman, was an outspoken supporter of accepting the energy funds, and he challenged Palin to identify the so-called strings. In an interview Wednesday, he lauded Parnell and the state's work on the spending plan.
"It is exactly what I hoped the administration would do; to put some thought into it, allocate the money to some high priorities," Hawker said. "Their work product shows, number one, how much the money was needed and, number two, how wisely it can be used."
"This announcement kind of puts the whole thing to bed," he added. "It's critical that the only real string attached to any of these funds is that we must be accountable."
Here's how the proposal breaks down -- and nearly triples -- the $28.23 million:
• State facilities would benefit from $10 million. Energy audits would help determine which projects get money, but three at the top of the list are the Atwood Building in Anchorage, the governor's mansion in Juneau, and the Fairbanks governor's office. The $10 million could grow into $40 million as the state leveraged the stimulus money with debt financing. The money would be paid back entirely with cost savings from the energy improvements, guaranteed by the contractor, known as "energy-performance contracting."
• Schools and municipal buildings would get $8 million. As with funds for state facilities, the $8 million would be increased to $32 million by allowing schools to participate in the state's energy-performance contracting. The Department of Transportation and Public Facilities and Alaska Housing Finance Corp. (AHFC) would manage the money for schools and municipal facilities, streamlining the process.
• AHFC would receive $2.5 million to weatherize about 1,800 low-income housing units statewide.
• About $3.7 million is committed to smaller villages that may not qualify for funds under the category for schools and municipal buildings. The funds would be managed by the Alaska Energy Authority.
• $4 million would go to AHFC for a variety of programs, including $1.75 million for training and outreach; $1.25 million to train people on energy audits for commercial buildings and small businesses; $850,000 to upgrade modeling software; and $150,000 to analyze building codes and help municipalities wanting to implement a code.
Contact Rena Delbridge at rena@alaskadispatch.com