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Alaska budget-reform coalition adds allies and ramps up Juneau lobbying effort

  • Author: Nathaniel Herz
  • Updated: September 28, 2016
  • Published January 23, 2016

JUNEAU — The budget-reform coalition led by the top executive of telecommunications giant GCI has broadened its membership and launched a lobbying blitz in Juneau, meeting with about 30 lawmakers this week.

The group, spearheaded by GCI President Ron Duncan, has secured broad-based support from high-profile figures in politics, business and organized labor, and is planning its public kickoff next week.

The campaign, originally called One Alaska but now rebranded as Alaska's Future, has one request of lawmakers: Use the earnings from the Permanent Fund to address the state's budget crisis. That step is the linchpin of Gov. Bill Walker's budget proposal, and one that the Legislature's nonpartisan budget analyst says is the most painless and sustainable way to fill the state's $3.8 billion budget deficit.

The campaign's many co-chairs now include Vince Beltrami, president of the Alaska AFL-CIO; former Democratic Gov. Tony Knowles; a pair of Native corporation executives, Helvi Sandvik, president of NANA Development Corp., and Sophie Minich, president of Cook Inlet Region Inc.; Steve Frank, a former Fairbanks Republican legislator; and Duncan. And it claims an assortment of endorsements: Alaska's biggest teachers union; Jim Jansen, the chairman of transport company Lynden Inc. and a key figure in the state's business community; the state contractors' trade association; and the Aleut Corp.

The group has also hired a pair of lobbyists, who alongside operatives from the AFL-CIO met with legislators this week, spurring reactions ranging from enthusiasm to skepticism to outright hostility.

The group — with its mashup of labor, business and a powerful lobbyist, Ashley Reed — makes for a "weird coalition," Beltrami, the AFL-CIO president, acknowledged. But it's out of necessity, he added, since passing comprehensive financial reforms could require a three-fourths majority vote by the Legislature — and support from both the Republican and Democratic caucuses in the House.

"We want to be as effective and reach as many people and help influence them do the right thing, as broadly as we can," Beltrami said in a phone interview. "Uncommon times call for some uncommon partnerships."

Meetings with lawmakers

Alaska's Future has presented lawmakers with information from polling and focus groups on the state's budget crisis that show, among other things, that nearly four in five people think that the situation will hurt them or their families, according to Ben Sparks, Alaska's Future's executive director. And the data, he added, show that the Permanent Fund is not the "third rail" of Alaska politics that many politicians understand it to be — and that it actually can be touched.

The efforts come alongside a similar campaign by the nonprofit Rasmuson Foundation, which presented its own polling data to lawmakers this week.

Several lawmakers who met with Alaska's Future representatives said the presentations were factual, aimed at showing that the public won't vote them out of office for turning to the Permanent Fund to help pay for government — a move that will likely result in smaller annual dividend checks.

In its presentation, the group was "very square about 'This is some information,'" said Rep. Lynn Gattis, R-Wasilla.

"Their goal is to get all Alaskans from different groups to work together," she added. "They're not telling us what to do."

The campaign's overtures, however, weren't embraced as warmly by all who received them.

Reed, the lobbyist, invited the House Democratic minority caucus to lunch this week at the high-end Capital Inn, a block or so from the state Capitol. But the Democrats ultimately canceled and chose instead to hear a presentation from Joelle Hall, the AFL-CIO's political director, while Reed and Sparks waited outside the room.

In an interview, three House Democratic caucus members argued that Alaska's Future was essentially a tool of Duncan and GCI aimed at using the Permanent Fund to close the budget gap instead of more progressive measures, like a graduated income tax or increased taxes on oil producers.

The income tax proposed by Walker is only expected to raise $200 million, and the tax increase he's proposed for the state's big oil producers will raise about half that. Those sums are dwarfed by the state's $3.8 billion deficit and by the amount of money that could be drawn from the Permanent Fund.

"There's something disturbing about some of the richest people in the state hiring political consultants to tell us to cut the dividend," Gara said, adding that he'd rather hear from his own constituents than from "a guy who owns a Learjet." (Duncan owns a company that has leased a jet to GCI, records show.)

The Democrats pointed to the group's decision to hire Sparks and political consultant Mike Dubke, who both worked on Republican U.S. Sen. Dan Sullivan's campaign in 2014, as evidence that it planned to launch political attacks against lawmakers who don't support their agenda.

Asked about the labor groups' endorsement of Alaska's Future, Rep. Chris Tuck, D-Anchorage, and himself a union official, said Sparks and Dubke were "hired to get those other groups on board."

"It reeks of a shadow government," he said.

Sparks referred questions about those comments to Beltrami, who said Alaska's Future was not created under terms that have "anything to do with the election."

"It only has anything to do with these next 90 days," he added, referring to the length of the legislative session. The suspicion is reasonable, Beltrami said, because Democrats and unions fought against Sparks and Dubke in the U.S. Senate election "in probably the biggest knockdown, drag-out political fight in Alaska's history."

'Doesn’t require partisanship'

Beltrami himself had initially expressed skepticism about working with the pair, but he said his reluctance softened after a meeting at an Anchorage coffee shop.

"This budget shortfall isn't a Republican or a Democrat challenge," Beltrami said. "It's an Alaska challenge. It doesn't require partisanship."

Alaska's Future, in its charter, says that "every conceivable solution to Alaska's budget deficit requires using Permanent Fund earnings to support essential public services."

Members believe, however, that that step "is not a complete solution and that other shared sacrifices will be required," and they also say a sustainable dividend needs to be part of any plan.

Knowles, the former Democratic governor, said Duncan recruited him to participate in the campaign and that he signed on because of the threat posed by the budget crisis to the state's economy and residents. Without major changes and use of Permanent Fund earnings, Knowles said, Alaskans' dividends could be at risk.

"It's going to depend on people standing up and working together on this," he said in a phone interview.

Alaska's Future's financial backers include the Alaska branches of the National Education Association, the Associated General Contractors, and the AFL-CIO, with some of the money expected to go toward television and radio ads. Beltrami said his group expected to give more than $100,000.

Alaska's Future plans to disclose full information about its donors, Sparks said, but it wasn't available Friday.

The group's two lobbyists in Juneau are each being paid $30,000 — Reed Stoops, and Ashley Reed, who also have $55,000 and $50,000 annual lobbying contracts with GCI. Beltrami said the AFL-CIO's lobbyist, Don Etheridge, who's paid $10,000 monthly, has also been working on the campaign.

Lawmakers, however, discounted the impact of their meetings with the group. Sen. Mike Dunleavy, R-Wasilla, called the information he got from Alaska's Future a single "data point."

"I can't count the groups that will come down here" to lobby, he said.

Sen. Berta Gardner, D-Anchorage, said she appreciated the work being done by Alaska's Future and other groups like the Rasmuson Foundation "to get people up to speed, to raise the issue."

"I think it is having an impact," she said.

But asked if she would ultimately vote for the measure that the group is pushing — spending earnings from the Permanent Fund — Gardner said she wanted to see which plans ultimately emerge from the legislative process, and which elements they include.

"We have to have a full plan," she said. "It's all in the details."

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