Alaska’s Legislature has been working to finish the state budget and pass bills in response to the coronavirus, and lawmakers could leave Juneau as soon as Friday.
With many bills moving through the process, here are 10 things to know about what the Legislature is doing:
1. Lawmakers are making COVID-19 relief a priority.
The House passed a bill on Thursday that includes many different provisions intended to provide relief from the effects of the virus. They include extending Gov. Mike Dunleavy’s public health disaster emergency declaration until Nov. 15, unless Dunleavy declares it’s over before then. The bill also would allow Lt. Gov. Kevin Meyer to hold elections by mail rather in-person.
2. Economic aid is the centerpiece of the talks
The Senate Finance Committee introduced a different bill focused solely on economic relief. The bill would provide moratoriums on evictions and foreclosures due to financial hardship from COVID-19. Senators also talked about providing aid for food security and heating fuel. The House added several pieces of this legislation into the primary relief bill. It’s not clear what form the final relief legislation will take.
3. It’s not clear what, if any, economic stimulus payments Alaskans will receive
The Senate included in its version of the budget bill $1,000 payments to everyone who received permanent fund dividends last year. Supporters said the payments would provide necessary assistance to Alaskans struggling with income loss. But leaders in both chambers are opposed to the idea of drawing more money from the permanent fund’s earnings reserve to pay for the stimulus. The Legislature passed a law two years ago that limits the annual draw from earnings to roughly 5 percent of the fund’s total value. These payments would break that limit, and further draw down the reserve at a time when its value has already fallen quickly.
4. The stimulus payments are at the center of another controversy
Most members of the Republican House minority voted twice against funding for a bill intended to pay for unbudgeted expenses through June. These votes mean $114 million of the $360 million in programs included in the bill won’t be funded. Sutton Republican Rep. George Rauscher was one of the no votes. He said the House control over the funding used in the bill provides insurance that the Legislature will approve economic stimulus. Dunleavy could veto $114 million in programs from the bill. But it could mean that Medicaid payments to health care providers like hospitals could be delayed until July, since the state has started to run out of Medicaid money that was supposed to be funded in the bill. The bill also was supposed to include $23.5 million in coronavirus health care funding, which may not be fully funded as a result of the votes.
5. The sweep is back.
Last year, an accounting process that had largely been uncontroversial became the center of an intense debate. This process is known as the “sweep,” in reference to the fact that various state accounts are subject to being swept into the Constitutional Budget Reserve account, unless three quarters of the Legislature votes to reverse that sweep. Last year, the Dunleavy administration said the accounts that fund the equalization of power costs in high-cost areas with those in lower-cost areas, and fund university scholarships, could be swept. While the Legislature ultimately didn’t allow the sweep to happen last year, the House minority said they want it to happen this year.
6. It’s not clear how much would be swept.
If the House minority holds firm on its position, then the sweep would occur on July 1. But it’s not clear which funds would be subject to the sweep. For example, the billion-dollar Power Cost Equalization endowment fund wasn’t considered to be subject to the sweep by state administrations before Dunleavy’s. The top legal advisor for the Legislature wrote an opinion last year saying that a “very good argument” could be made that the fund isn’t subject to the sweep. And it could be subject to a lawsuit if the sweep were to occur. The fund that pays for university scholarships and grants is in a similar situation.
7. Progress is happening on the budget
A conference committee is working to resolve the differences between the House and Senate versions of the budget bill. The committee has already agreed on most points. But some of the more controversial ones are still being negotiated. They include the size of PFDs; the size of economic stimulus payments; and the amount of state funding for public education. The Senate included $30 million for public schools, the same amount of funding schools received this year above the amount mandated by the formula in state law. But Rep. Cathy Tilton, a Wasilla Republican, noted that education costs would increase further if the Legislature also passes a bill to expand access to pre-kindergarten and improve students’ reading.
8. Expect a vigorous debate before the final budget vote
Passions are running high on both sides, including significant differences over whether the state should violate the limit on permanent fund earnings draws to make the stimulus payments. Opponents of the payments have noted that the federal stimulus law includes $1,200 payments to most American adults, as well as increased unemployment insurance benefits for those who lost their jobs. But some supporters in the Senate said $1,000 is only a portion of the $1,300 they believe Alaskans are still owed from a reduction to dividends last year.
9. These aren’t the only bills
The Legislature has been busy the past two weeks advancing several bills that aren’t directly related to the coronavirus response or the budget. They include an overhaul of state regulation of alcohol sales that Soldotna Republican Senator Peter Micciche has worked on for years.
10. Even if lawmakers leave Juneau on Friday, that may not be the end of the session
Friday is only the 67th day of session, and the Alaska Constitution allows sessions to last up to 121 days. But lawmakers don’t know if COVID-19 will require them to pass more legislation this year. So they may convene again.
