Alaska Gov. Bill Walker is running for re-election this year. But first, he has to get through the final legislative session of his four-year term.
Walker, a Republican-turned-independent, ran for office on a platform of building the long-sought natural gas pipeline from the North Slope. But upon his election in 2014, a massive budget crisis brought on by a crash in oil revenue quickly consumed his focus.
In the past two years, Walker has presented the Legislature with an array of proposals to fill the deficit. But even after a string of special sessions, lawmakers haven't been able to agree on a long-term budget framework beyond one-year spending plans.
Walker unveiled his latest budget proposal, which would support state spending with a new payroll tax and investment earnings from the $63 billion Permanent Fund, last month.
He expanded on that plan, and reflected on his past three years, in an interview Wednesday in his downtown Anchorage office.
The interview has been edited for clarity and condensed.
Anchorage Daily News: So, did you do anything special for Christmas?
Alaska Gov. Bill Walker: Yeah. For Christmas I went down to Alyeska for a day with our grandkids. I realized the last time I'd skied was ArcticMan (the annual ski-snowmachine competition southeast of Fairbanks).
And I went from ArcticMan to the magic carpet ride, which is, like, a 0.5 percent conveyor-belt glide with my 2-year-old grandson.
ADN: So you still haven't skied at Eaglecrest in Juneau yet?
BW: No. I took my skis back, and it's not open. There was no snow. It was for a while — I missed it.
ADN: OK. What are you telling people at this point about the state's financial situation, the budget crisis?
BW: Well, I'm saying that the solution is at hand and that I'm pleased that both the House and Senate passed the Permanent Fund Protection Act (Walker's legislation to spend Permanent Fund earnings on government services). It's in conference committee now. With that passed, that brings it within $700 million of closing the gap. So, it's a big, big step. I'm encouraged by that.
ADN: Should Alaskans be worried about the exact details of a plan like that, to use Permanent Fund earnings to pay for government? Does it matter if we're spending 4 percent, 5 percent, or 6 percent of the Permanent Fund's value each year? Or at this point, if we get any kind of plan, is that OK with you?
BW: Well, it needs to be a structured draw, and it has to be something that does not put the Permanent Fund at risk. The concern is if it's too high. It does make a difference, it really does. So, part of our whole goal of that legislation was to protect the Permanent Fund corpus so that it can continue to churn out a dividend.
ADN: Are you comfortable with drawing 5 percent annually?
BW: I'm comfortable with what we have submitted. It's about at that. (Walker's plan, initially, calls for tapping 5.25 percent of the Permanent Fund's value.) If there needs to be an adjustment, I'm pretty conservative when it comes to that because I want to make sure that it is protected.
The goal is to make sure that we don't over-rely on the earnings and always assume it's going to be an up year. You look at 2008, we lost billions of dollars in the stock market.
We have to remember that we're tying everything with something happening someplace else. Whether it's the price of oil, whether it's the stock market, they're all external is the problem we have.
ADN: Do you think Alaskans support spending more money to advance the proposed gas line project?
BW: I don't know if they do or not. I know we didn't put any money in the budget for the gas line. And I think we need to see — we have great potential partners in the joint development agreement (to advance the project). We have incredible, incredible relationships with the White House and the president of China. We were just on a call with the White House today on the gas line. We have pretty frequent communications with the White House on the gas line; that's pretty astounding to be even saying that.
ADN: But for them to continuing work on the project, they'll have to spend money that was already budgeted, right?
BW: Several years ago.
ADN: But even if the public isn't quite there, in your mind it's worth continuing.
BW: Yeah, you don't pull the rug out when you sign in front of the two presidents. It just seems like a bad time to say, "Hey, let's pull the funding."
ADN: Can you point to a mistake that you've made over your first three years and talk about what you've learned that you'll be doing differently in this upcoming legislative session?
BW: You know, you're the second person to ask me that question. There was a fifth-grader in the Tustumena Elementary School in (Kasilof) when I went there; they asked that same question.
I talked a little bit about the bears that I pardoned. I should have been more specific. I thought they were going to go to Montague Island. And they were dropped off near Hope and wandered into the campground in Hope. So we should have been a little more specific about that.
I did an administrative order on the Commercial Fisheries Entry Commission, and I did not take the time to vet all the organizations that used that. And it resulted in litigation. We prevailed and I rescinded it. They said we missed a step, and I took full responsibility for that. Process is important to us; we missed that. Because I have the ability to do something doesn't mean it's the right thing to do. So, we undid that.
ADN: What about when it comes to the big picture, to key priorities like the fiscal plan or the way you've managed your relationships with the Legislature? Is there anything you might be doing differently now, having learned from a mistake you made?
BW: Not really. Decisions that I've made have been hard decisions. Very politically unpopular decisions. And one might expect that I would sort of say, "I wish I hadn't done this or that." I really don't. They were needed. There were no other options when you're losing $10 million a day. You have to make some tough decisions. So, I don't second-guess a lot of what I do. If I did, I'd be a mess. That would be a difficult way to do this job, continuing to look over my shoulder. Because the problem is once I make one tough decision, the next day I have a whole table full of more tough decisions to make. I can't do that.
ADN: If we get to the end of this year's session and there's still no long-term fiscal plan for the state beyond a one-year budget, should Alaskans hold you accountable for that, or should they hold the Legislature accountable for that?
BW: Well, there's been no lack of options we've put on the table. We don't create the laws. We don't appropriate the funds, obviously. So it'd be really hard for me to step up and say, "Well, I'm responsible for this." I don't have a green or a red button in front of me in the chambers.
We put out nine different revenue options the first year. Then we put out some additional ones beyond that. We repackaged them. So it's not like we were sitting back, putting our feet on the desk saying, "We're just going to wait for them to do their job." We've engaged with them and given them numerous options of how to close the fiscal gap.
ADN: Are there areas aside from public safety where you think government is not giving Alaskans the service they deserve?
BW: I hear a lot about people that are concerned about additional service on the Alaska Marine Highway System. And I look at that and I know that's a challenge, but it's also — we do the best we can with the funds we have. And I probably have meetings with Commissioner (Marc) Luiken more regularly than almost anybody else.
ADN: Will we ever get the bars back on the ferries?
BW: That discussion took place yesterday, as a matter of fact. It's my hope that we do — that we are able to provide full service on the ferries. It's a process you have to go through. But I'm hoping we're able to provide all the services available on the vessels that we own.