Juneau Report: Representative DaveTalerico/PFD Bill Reflects Alaskan Values

In our One-on-One exclusive, Imagine for a moment that your favorite person has been diagnosed with a life-threatening disease that requires out-of-state treatment.  Of course, you drop everything to support and assist them.  The patient will still qualify for a PFD, but the caregiver won't under the current regulations - so Healy Representative Dave Talerico has sponsored a bill to fix that disparity.

After we meet with Juneau Representative Andi Story, whose House Transportation Committee just heard from the mayors of non-coastal communities on the negative impacts they felt from the dramatically reduced winter ferry service.

ANWR, ARCTIC NATIONAL WILDLIFE REFUGE, DON YOUNG ALASKA, DORENE LORENZ, LISA MURKOWSKI ALASKA, THE TAX CUTS AND JOBS ACT

The small independents who depended on reimbursement from the State for oil and gas exploration may be getting a check in 2019, under Governor Walker’s proposed Alaska Economic Recovery Plan.

The Legislature ended what some called an over-generous cash credit program with the passage of HB111.

Tax credits have been credited with once dead Cook Inlet production rising up 80% since 2010, and the robust activity of smaller independent producers and explorers like Hilcorp, Caelus Energy, Repsol, and Armstrong.

After the State backpedaled on paying the tax credits, Caelus Energy delayed drilling of Smith Bay.  The field is perhaps one of the largest finds in recent history on the North Slope – holding up to 2.4 billion barrels of crude.

As part of the Alaska Economic Recovery Plan, the Walker Administration proposes to pay off the $900M remainder of outstanding future-obligations to independent oil and gas exploration companies at a lower rate.

It is hoped that the payments will create more confidence in the State for independent producers, which will equate to greater investment.

The State plans on offering a 10% discount rate in the fiscal year 2019. The rate will be lowered to a 6% discount rate in exchange for an override royalty interest in the well.

To fund payment of these outstanding credits, the state will issue bonds with the discount covering the cost of borrowing.

Walker Proposes 1.5% Payroll Tax To Cover State’s Deferred Maintenance

As goals shift from filing the gap to fueling the economy, local contractors in 60 Alaskan communities will be put to work on deferred maintenance projects.  Governor Bill Walker is hoping this statewide sweetener will make his failed payroll tax more palatable to Legislators.

Governor Bill Walker I-AK: “To stand by and watch our economy spiral downward, to watch our unemployment continue to rise, is unacceptable.”

In its new rendition, Walker’s payroll deduction will only be collected over three years—and is expected to generate $800 million. The Administration projects this initiative will create well over 1,000 jobs while removing debt from the budget.

Walker asked the Legislature to consider the tax in the fourth special legislative session but found no will enforce an income tax when the State was in a recession.

Former Speaker of the House, Representative Mike Chenault R: “Last session there was not enough support to do that, so he is going to have to get out and work with the Legislature in enacting that, and see if he can find the votes to pass it.”

But the Senate Finance co-chairs have been struggling to resolve growing deferred maintenance issues with the State’s infrastructure. Senator Bishop proposed a modified school payroll tax last year intended to cover the leaky roofs on schools around Alaska.

Senator Tom Begich: “There was a lot of traction that that was getting within the Majority, so I think the Majority might be interested- I mean that is the sell.”

On the deferred maintenance list are repair projects for schools, the Pioneer Home, courts, highways, and harbors.  It also includes popular community needs and housing investment programs like the Weatherization Program and AHFC’s Housing Facility Maintenance Program.

The proposal taxes 1.5 percent of wages earned by Alaskans and non-resident workers, capped at $2,200 or twice the previous year’s permanent fund dividend amount—whichever is higher.

About fifteen percent of the revenue collected from the tax is projected to come from non-resident
workers, who in 2015 earned more than $2.7 billion.

Story as aired:

Walker Calls Legislature Back For Revenue Session

Courtesy of Ron Niebrugge

The voter’s suggested the job should take just a couple months, but with so much at stake the road traveled by this year’s legislative session isn’t coming to an end any time soon. Thursday, Governor Bill Walker announced that he will be calling a Fourth Session to convene October 23rd in Juneau.

In his statement, Walker suggested an agenda would be released on September 22nd that would be narrowing the focus on revenue.

A lot of discussion has revolved around re-instituting an income tax, an effort that wouldn’t capture revenue from visitors and wouldn’t be as oppressive to lower income Alaskans. The idea of taking a cut out of their paycheck at a time when the state is in recession has local residents shaking their head.

Senator Peter Micciche (R D-O): “When I was mayor of Soldotna we offset our tax burden on people from somewhere else. That is what I am interested in, if we do have to go to the revenue option.” 

Senator Mia Costello

Senator Mia Costello of Anchorage doesn’t see any efforts to increase the state’s revenue via an income tax being successful.

Senator Mia Costello (R D-K): “We put the income tax on the floor for a vote just to show that there isn’t support for it, so I don’t see that coming up.”

Walker feels that money has to be found somewhere to fill the projected $2.7 billion budget gap brought on by the continued low oil prices, which have pushed Alaska into a fiscal crisis and lingering recession – and that somewhere can’t be savings anymore as projects show that Alaska currently has less than one year’s worth of savings to fund essential state services like public education and public safety.

Story as aired on KSRM News:

http://www.radiokenai.us/wp-content/uploads/2017/08/Dorene-on-Walker-calls.mp3

Do Deleting Comments Block Free Speech?

Courtesy of Ron Niebrugge

If you don’t like them, ignore them, that’s the advise your mother gave you as a kid.  How that translates into social media when you are an elected public figure has yet to be determined.

After the ruckus caused by Trump’s Twitter-gate, Representative Scott Kawasaki (D D-1) asked the Alaska Legislature’s Division of Legal and Research Services to weigh in on a legislator’s right to block users or suppress comments on social media platforms like Facebook or Twitter.

Several members of the Alaska State Legislature have admitted to being either social media blockers or deleters, like Anchorage attorney Les Gara who represents the Spenard area.

Representative Scott Kawasaki (D D-1): “Les Gara actually blocks like the oil industry folks, and they get pissed off at him.  So it was sort of a thing,”

Representative Gara says, not my thing.

Representative Les Gara (D D-20); “There are a couple of campaign operatives, ….they are just there to spend money against you and spin what you have to say. … It’s very few people.  It is a small handful.”

Scott Kawasaki

In 2011, Legislative council adopted social media guidelines, but they didn’t address blocking users or suppressing comments, and if it makes a difference if the activity is happening on their personal page or their official public figure page. The differences between a designated public forum and a limited public forum have become increasingly unclear when paired with the many nuances of the internet.

Representative Scott Kawasaki (D D-1): “It is really fascinating, ’cause you wouldn’t think that it should be a problem, but then the memo seems to say, well is it common property?  Are you therefor supposed to allow access to anybody no matter what – that kind of thing – or is it free speech, and you can curb free speech.” 

In a brief responding to Kawasaki’s question, Leg Legal found that according to the 9th U.S. Circuit Court of Appeals, a limited public forum is a sub-category of a designated public forum that refers to a type of nonpublic forum that the government has intentionally opened to certain groups, and that the U.S Supreme Court has recognized that there is “no basis for qualifying the level of First Amendment scrutiny that should be applied to the internet,” noting that the basic principles of freedom of speech do not change when applied to a new medium, such as social media.

Whether a public official’s use of a social media account creates a designated or limited public forum is unsettled. There is no case law governing this issue in Alaska, so the question has yet to come before a judge or jury.

Story as aired on KSRM News:

http://www.radiokenai.us/wp-content/uploads/2017/08/Jennifer-on-Social-Media-Block-.mp3

Alaskans Concerned With Lack of Forward Funding For Education

Forward funding for education was a hot topic of conversation at the Funny River Community Center Friday night, where a packed house of area residents had a chance to voice their concerns to the three candidates for Kenai Peninsula Borough Mayor.

Seasonal issuing of pink slips to teachers, the uncertainty in school budgets, and remembrances of the pre-oil education tax equating to a day’s salary were voiced by frustrated participants.

Representative Paul Seaton

The need for forward funding for education is a call to action voiced also by Representative Paul Seaton (R-D31).

The problem, Seaton offered, was to be found in the Senate Majority leadership, who offered dramatic cuts to education funding.Representative Paul Seaton: “The House Majority Coalition still says that funding education and having good schools is the most important thing that we can do for our future…I think that is the most important thing we can do to make sure our state thrives.”

“The House budget last years did do the POMV draws for ’17 and ’18, and that was specifically to forward fund education…and we would have had not the entire amount for next year, but we would have had half of the money already in the public education fund.” 

Seaton said the Senate refused to compromise on forward funding for education, and subsequently the House’s effort was futile.  He strongly suggested that community members who wanted forward funding mandated contact their Senate representative and let him know.

Story as aired on KSRM News:

http://www.radiokenai.us/wp-content/uploads/2017/08/Dorene-on-Alaskans-concrened-with-lack-of-forward-funding-for-education.mp3

Round One Education Budget Win, Round Two Presumed To Be Tough

Courtesy of Ron Niebrugge

They took a long time in getting to Governor Bill Walker’s desk, but both the Alaska State Capital and Operating Budgets got passing grades for education funding.

Senator Tom Begich (D-DJ): “The Capital Budget continues to support deferred maintenance of schools, which has been neglected for years. That is a superb outcome.  In terms of the Operating Budget, it ensures that there is full funding for education, at least at the prior year levels, and increases the opportunity for Pre-K in rural areas. Both of these are tremendously positive impacts for rural schools.” 

For schools that had braced for deep cuts – the flat funding was a win.  Fears were that education cuts would be significant, the Senate originally proposed a near 6% decrease in funding. The Final Compromise was by no means unanimous.

The Alaska State House Republicans from the area between Eagle River and North Pole voted against the final budget.  The sole State Senator who voted against the proposition represents the same area.

Senator Tom Begich

Although funding for education is one of the few things that are mandated by the Alaska State constitution, the clause simply states that, “The legislature shall by general law establish and maintain a system of public schools open to all children of the State, and may provide for other public educational institutions.”

Unlike the Capital Budget, there is no formula that demands what percentage of State funds must be expended to that end. Lawmakers are suggesting that the fight for keeping even flat funding for schools is going to be a scuffle next session.

Senator Tom Begich (D-DJ): “That’s likely the primary point of pressure will be on education funding, ..particularly the Senate will focus on cutting education funding.  If parents care they should become engaged and telling their Senators to support full funding of education.”

As aired on KSRM News:

http://www.radiokenai.us/wp-content/uploads/2017/08/Dorene-on-Round-One-Education.mp3

Promise Of New Oil Ousts Demand For Personal Income Tax

A strong reluctance to consider any efforts to levy a personal income tax on Alaskans already struggling through a recession was recently expressed by Senator Peter Micciche (R-DO).

At a joint Soldotna-Kenai Chamber of Commerce luncheon earlier this week, Micciche took to a robust Power Point presentation available through his office.

He clicked through a series of graphics and statistics demonstrating that the Unrestricted General Fund budget is at a decade low, Education’s Basic Student Allocation hasn’t been cut since he has been in the Legislature, and the smallest Capital Budget in 17 years was just passed.

Senator Peter Micciche: “”It used to be that $107 a barrel was necessary to balance the budget, with the POMV around $54 for the whole year, which is within the realm of possibility, either that or if we can continue to see production increase on the Slope – we will have a balanced budget.”

Micciche suggested the Legislature has done a respectable job reining spending in – cutting a billion dollars a year over the last five years, essentially cutting the State Budget in half since he arrived in Juneau.

Within striking distance – filling a $100 million gap and meeting the current levels of State expenditures. Black gold could pump Alaska immediately back in the black on the balance sheet.

Senator Peter Micciche: “We are expecting a third year of increased production. You bring on a Willow at 70-80,000 barrels a day, plus the other projects that are being looked at right now – we are in the black, immediately.  The reason we don’t feel the income tax is the right time is because of all those positive discoveries that we expect to see on line within the next few years.”

Area Representatives Find Legislative Session More Bear Than Bull

Courtesy of Ron Niebrugge.

Representative Mike Chenault (R-D29) expressed his frustration with the first session of the 30th Legislature to members of the combined Soldotna-Kenai Chambers of Commerce Wednesday.

Chenault was Speaker of the House from 2009 – 2016, setting a record for the leadership position. 

2017 saw a power shift from the Republicans to a coalition of Democrats and Independents, and the installation of Representative Bryce Edgmon D-District 37 of Juneau as Speaker.

Representative Mike Chenault: “We did get a capital budget and an operating budget passed, which is important for the State of Alaska, but I think we are starting to see different directions with people want to attempt to head down as far as any new revenue streams or ways to increase the revenue that the State of Alaska gets to be able to fund the budget that Alaskans seem to want.” 

District 29’s other Representative, freshman Gary Knopp, found the lack of statesmanship of his colleagues challenging. 

Representative Gary Knopp: ” We could have talked about this in the first 60-90 days and been done, but they like to play the political games and holding someone’s good bill and hoping they can get theirs.  It just doesn’t work like that. It just didn’t work out.”