JUNEAU — Members of the Alaska Legislature opened their 2022 session on Tuesday with low expectations despite rising oil prices and billions of dollars in federal aid that could meet many of the state’s short-term needs.
In a series of interviews, rank-and-file lawmakers said they believe the Legislature as a whole is disinclined to take risks before elections this fall. That means they’re less likely to reach agreement on a new long-term budget plan that includes a reliable formula for Permanent Fund dividend payments.
Instead, they expect debates about how much federal aid to spend on new infrastructure versus boosting the amount of the 2022 Permanent Fund dividend.
“I think there’s a sense that the future of Alaska will have to be resolved at the ballot box. It will be very hard to advance fiscal reforms this year,” said Rep. Andy Josephson, D-Anchorage.
“It seems to me that folks are a little more risk-averse in an election year,” said Sen. Josh Revak, R-Anchorage.
Lawmakers say this year is different from prior election years because redistricting has them uncertain who they will represent next year and because compromise has become more difficult. As national politics becomes more partisan, relations between Republicans and Democrats have soured at the state level too.
The presiding officers of the state House and Senate say they remain optimistic about the possibility of reaching agreement on a long-term fiscal plan, something that eluded the Legislature during a record 217 days in session last year.
“We’ve been struggling for six or seven years now. I think all the pieces are on the table, and it’s time to move forward,” said Senate President Peter Micciche, R-Soldotna.
But Alaska’s House and Senate are deeply divided along ideological lines, and those divides haven’t changed in the months since the Legislature met last fall for its fourth special session of 2021.
The predominantly Democratic coalition in control of the state House has a bare-minimum majority; if just one member dissents from legislation, it will not pass without the support of members of the Republican minority. In the Senate, the 14-member Republican majority is internally divided and occasionally needs the support of the Democratic minority on key votes.
“From the inside here, I really struggle to see progress being made,” said Sen. Roger Holland, R-Anchorage. “We either have to send more conservatives to the Legislature, or we have to send more liberals to the Legislature. We are a divided Legislature.”
To avoid budgetary brinksmanship, which brought the state within four days of a government shutdown last year, some lawmakers are considering whether they can finish work on the state’s annual budget by April 1 and adjourn the session entirely by May.
Last year, some members of the House’s Republican minority, citing dissatisfaction with the majority’s handling of the budget, withheld their support for a procedural supermajority vote that allows the budget to take effect more quickly than normally allowed by the state Constitution.
Some members of the minority switched their votes, but not before the state began preparing for a possible government shutdown.
If the budget passes before April 1, the supermajority vote — and the support of minority Republicans — isn’t needed.
“That’s why I think those in the know, the co-chairs in the House and the Senate, they are going to want to get this budget done before April 1,” said House Minority Leader Cathy Tilton, R-Wasilla.
Speaker of the House Louise Stutes, R-Kodiak, said members of the House majority haven’t discussed the timing of the budget, and majority members of the House Finance Committee said they haven’t discussed the issue, but other members of the House majority said they are prepared to advance the idea if negotiations break down between the majority and minority.
Senate Minority Leader Tom Begich, D-Anchorage, said Senate Democrats have been talking about the issue since at least last June, hoping to avoid what he called “inappropriate hostage-taking.”
But Senate Finance Committee co-chair Sen. Bert Stedman, R-Sitka, said there are no plans right now to rush the budgetary process.
Instead, he said, the focus of legislative budget work will be on how to spend about $617 million in remaining COVID-19 economic relief, as well as an estimated $3.2 billion in federal infrastructure money that the state will receive over the next five years. (Some estimates use a slightly higher $3.5 billion figure.)
The preliminary spending plan introduced in December by Gov. Mike Dunleavy calls for diverting much of that money into next year’s state operations budget, freeing state dollars for use in a 2022 dividend that would match the amount paid for under a new dividend formula proposed by the governor.
To pay for infrastructure projects, the governor proposes borrowing money through a voter-approved general-obligation bond.
Several lawmakers said they’re skeptical about both aspects of that idea.
“I’m a big supporter of GO bonds, but we’re getting $3.2 billion over five years. We may not have to go that route because of that,” said Sen. Elvi Gray-Jackson, D-Anchorage.
“We need to plan for the long term, not just immediate gratification,” said Rep. Kelly Merrick, R-Eagle River and co-chair of the House Finance Committee.
While lawmakers say they expect budget and fiscal discussions to absorb most of their attention during the legislative session, they have already introduced dozens of bills on various other topics, including police oversight, changes to Alaska’s elections system and personal privacy.
Rep. Tom McKay, R-Anchorage, said that “some legislators might be inclined to introduce bills for political purposes, campaigning purposes,” and he doesn’t exclude himself from that category.
This year, he prefiled a bill that would ban teachers from using the New York Times’ 1619 Project to teach the history of race in America, and a bill that would determine what sports teams transgender students may compete on.
Legislation on both subjects has been advanced in Republican-led states, and both topics are popular among Republican voters.
While neither is likely to advance as long as a predominantly Democratic coalition controls the House, it puts those issues in better position to move forward if control of the House switches in November.
“You’ve got to start somewhere, and hopefully we’re in the majority next time and we can make more progress on them,” he said.
Correction: Alaska has about $617 million in unspent COVID-19 economic relief money. The previous version of this article used an older, incorrect estimate and that figure has been updated.