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Rep. Kito: Without negotiations, House Majority's new 'compromise' rings hollow

  • Author: Sam Kito
  • Updated: June 29, 2016
  • Published May 27, 2015

Throughout this past legislative session, into our extended session, through the first special session, and now into the second special session, the Alaska Independent Democratic Coalition has held that it is important to fully fund education, expand Medicaid, honor employee contracts, and provide for essential state services. Our priorities reflect our values, which include supporting Alaska's children and working families.

There has been a lot of discussion recently about the failure of negotiations between our coalition and the House majority and, by extension, the Senate majority. My observations have not been of negotiations, but of coercion and avoidance. The House majority has known since the beginning of session that to fund our state budget we would need to borrow more than $3.5 billion from the savings account called the Constitutional Budget Reserve. A draw from the CBR requires that three-quarters of the House and Senate agree with the budget. Over the past several months, we have seen the House majority try repeatedly to negate that vote through budget manipulations, legal opinions, and threats. The one thing they have not done is sit down and negotiate points of a budget compromise in good faith.

Our coalition has proposed budget cuts and deferrals that more than balance our reasonable prioritization of funding for Alaska's children and working families. However, our suggestions for additional cuts and deferrals were never acknowledged or fairly considered. We can use funding from mega-projects that do not provide a positive return on our investment. Projects such as the Susitna-Watana dam, Bragaw extension, Juneau Access Road, or the Knik Arm crossing. A large amount of funding has been set aside for these projects that the governor has indicated is on hold for further review. In addition, our coalition has proposed deferring some of the $700 million in oil tax credits that are expected to be paid out this next year. This deferral does not make the liability go away. Rather, it postpones the liability to a future date, when our fiscal situation may look better.

The Senate has also set aside approximately $30 million in what is called a "parking garage." The purpose of this money has not been identified, but it has been sequestered for future use. This money could easily be available to support essential state services.

We have also seen an abdication of leadership by the Senate majority through repeated statements that they have passed a budget with a three-quarters vote. The Senate did pass a budget, and did have three-quarters of their members vote for the budget, but that budget is not funded until there is an agreement that provides for a draw from the CBR. The draw from the CBR will only be available if three-quarters of the House also votes for the draw. That means the Senate needs to willingly participate in negotiations with the House majority and the coalition to fully fund Alaska's budget.

Now we are faced with another budget manipulation that proposes taking $6.4 billion dollars from the earning reserves of the Alaska Permanent Fund and put it into the fund's corpus. This action will both reduce the amount available for funding the budgets this year and next year, and also change the supermajority vote needed to use the CBR to a simple majority of each body. This action requires only 21 members of the House and 11 members of the Senate, a simple majority. However, this action will have potentially damaging impacts on the dividend. It will also make the money unavailable for important future needs like helping us get a natural gas pipeline. Without adequate reserves in the future, our ability to begin construction on a natural gas pipeline may be in serious jeopardy.

Even if the House and Senate majorities completely reject any of the cost-saving cuts and deferrals we have proposed, and we are left with only a discussion of our priorities, we are only talking about approximately $75 million added to the budget that was sent to the governor. That $75 million will help keep the number of students in Alaska's classrooms down, honor the negotiated employee contracts, provide basic transportation services to coastal communities on the Alaska Marine Highway System, and save 50 jobs at the University of Alaska. Let's put aside politics, negotiate in good faith, and protect the long-term interests of Alaska.

Rep. Sam Kito III, D-Juneau, has served in the Alaska House of Representatives since 2014. In the 29th Alaska Legislature, he is a member of the Legislative Council, Legislative Budget & Audit Committee, and House Labor and Commerce Committee.

The views expressed here are the writer's own and are not necessarily endorsed by Alaska Dispatch News, which welcomes a broad range of viewpoints. To submit a piece for consideration, email commentary(at)alaskadispatch.com.

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