Alaska Legislature fails to block pay raises for lawmakers, governor and cabinet

JUNEAU — Alaska state legislators failed to block a 67% pay raise for themselves and a roughly 20% salary increase for the governor and his cabinet.

The state’s independent salary commission held a 15-minute meeting in March, where all five members agreed to the substantial pay boost. All of the commissioners had either resigned or were replaced by Alaska Gov. Mike Dunleavy in the days leading up to the abrupt meeting.

Under state law, legislators had until May 15 to pass a bill to block the pay raises — but one did not advance for a final vote. The pay raises are set to go into effect July 1 for Dunleavy and his cabinet, and in January for the Legislature.

The newly appointed commission recommended in March that legislators’ salaries should increase from $50,400 to $84,000 per year, matching half the new salaries proposed for heads of state agencies at $168,000 per year. That will be the first pay raise for legislators since 2010.

“I think it’s a fair salary,” said Senate President Gary Stevens, a Kodiak Republican, in a brief interview Tuesday. “We are dealing with billions of dollars, and I think we want to attract people who may not want to leave the job they have been at.”

Lawmakers are also eligible for per diem expense payments, which allow them to collect $307 tax-free per legislative day. Per diem payments add another roughly $37,000 per year for legislators who claim them during an entire 121-day legislative session — special sessions can boost that further.

The Legislature unanimously blocked pay raises for the governor and his cabinet in March after the state’s salary commission made no pay recommendations for the Legislature itself.

In November, the former commissioners proposed that the governor’s salary should be increased from $145,000 per year to $176,000, representing an inflation adjustment and a 2%-per-year increase since his last pay raise in 2011. The lieutenant governor’s salary would increase by around 10% following the same formula to just over $140,000 per year.

After the new salary commission made its pay recommendations for lawmakers in March, Dunleavy defended his actions to appoint all new members. He said at the time that the public process was just beginning, and that the pay bumps were needed to keep state commissioners’ salaries competitive.

The governor’s office declined to comment Tuesday on the pay raises.

Members of the bipartisan Senate majority caucus had met with the governor before the salary commission’s March meeting and discussed the proposal to peg legislators’ salaries to those of state commissioners. It remains unclear how the salary commissioners proposed the same $84,000 figure for legislators, but the commission’s new chair said the idea may have been suggested by members of the governor’s office.

The total cost for the legislators’ salary increases is roughly $2.7 million per year, according to the nonpartisan Legislative Finance Division. The raises for the governor, lieutenant governor and 15 state commissioners are set to cost $369,000 per year.

There is no way for state legislators to decline the pay increases, said Jessica Geary, executive director of the Legislative Affairs Agency.

In March, members of the 17-member Senate majority said that the process to approve the pay raises had been flawed and clumsy, but they generally supported those recommendations, arguing that without the pay boost, younger and newer legislators could not afford to serve in Juneau.

Members of the Republican-led House majority and the Democrat-dominated House minority were more skeptical.

In the week after the commission met, falling oil prices were projected to leave Alaska’s budget with a $925 million revenue hit over two fiscal years. The House majority proposed reducing the Permanent Fund dividend in its operating budget as a result from roughly $3,400 to $2,700, following the so-called “50-50″ model.

There were pledges by the House majority to try to block the pay increases, but until Monday, the full House had not debated legislation to do that. After a short discussion on the floor Monday, the pay rejection bill did not advance for a final House vote before the May 15 deadline.

As the Legislature has not passed a budget and a state government shutdown still looms, Anchorage Republican Rep. Craig Johnson said Tuesday that the rejection bill — House Bill 135 — should still pass to tell Alaska voters that the House disapproves of the pay raise.

“I think for my conscience, I need to make a statement: Don’t cut the PFD, don’t shut down government, don’t overspend and give me a raise. It doesn’t sit well with me,” he said before the House approved the messaging bill on a 29-11 vote.

Rep. Donna Mears, D-Anchorage, noted the pay rejection bill had been ready for a final vote for weeks — but it wasn’t brought to the floor by the majority. Mears, a freshman, called Tuesday’s debate to make a statement about pay increases after the deadline to reject them had passed “Kabuki theater.”

“We need to be making changes for the people of Alaska, and not for ourselves,” she said, adding that she was beyond frustrated with the process used by the salary commission and the Legislature.

A separate measure — House Bill 140 — would reform how the salary commission operates, including requiring a general election to take place before legislators’ pay increases take effect. But it did not advance to a final vote. Proposals to block the pay raises in the Senate were solidly rejected.

According to the National Conference of State Legislatures, only three states offer a higher base pay than Alaska’s new $84,000 salary for state lawmakers — New York, Pennsylvania and California. Several states offer no base pay at all and guarantee only per-diem payments when lawmakers are in session.