Governor’s call amended to include capital budget with full Legislature convening in JuneauSenate Democrats Request Oil Tax Reform Be Added to Special Session CallBy MARY KAUFFMAN
July 18, 2019
“In my daily discussions with legislators – those both in Wasilla and in Juneau – many have acknowledged that real progress needs to be made on the capital budget and that work cannot be completed until the legislature is meeting in one location,” said Governor Dunleavy yesterday. Dunleavy said, “With sensitivity to the time that remains to capture federal funds, the Legislature will be able to quickly consider the capital budget, the PFD, and conclude this work for the people of Alaska before the end of July.” Members of the Alaska State House and Senate, who heeded the Governor’s statutory call to meet in Wasilla, recently submitted a proposal to Governor Dunleavy to amend the call in order to address the capital budget and work with all lawmakers to address outstanding items. The proposal – dated July 15, 2019 – recognizes upcoming deadlines and the risk of losing access to critical matching funds – necessary to develop and sustain the economy, Alaskan families, and the state. Leadership of the Senate and the House caucuses have also acknowledged the necessity and urgency to resolve these issues and requested that the capital budget be added to the call. They too are committed to working together for the benefit of all Alaskans. Today, July 18, 2019, Governor Dunleavy planned to introduce a capital budget that will contain state matching funds for federal transportation programs, state matching funds for village safe water projects, funding for the new crime legislation (HB 49), and other necessary fixes to a number of fund source changes that appeared in the final version of the capital budget passed by the Legislature in May. “Timelines compel us to find a solution sooner rather than later. Concluding work on the state infrastructure budget and the PFD brings the Legislature one step closer to finishing the work of the people,” said Governor Dunleavy. “Legislative leaders from all four caucuses are meeting frequently with the governor. We have identified areas of alignment and found a productive next step to move Alaska forward,” Senate President Cathy Giessel (R-Anchorage) said yesterday. “I thank the governor, Speaker Bryce Edgmon, Senate Minority Leader Tom Begich, and House Minority Leader Lance Pruitt for their active participation in negotiations for the benefit of the Alaska we all love.” Senate Democratic Leader Tom Begich (D-Anchorage) in a prepared statement said, “I personally want to thank the Governor for calling the Legislature to Juneau, Alaska’s capital city. Alaska is facing a number of challenges. The Governor’s call will ensure we address these challenges together as we continue to work to bring hope and opportunities to all Alaskans." Begich said, “We look forward to continuing the dialogue with the Governor, the Senate President, the Speaker of the House, and the House Minority Leader to address this year’s dividend, fund a capital budget that brings in more than one billion federal dollars for roads and infrastructure, and seek a path to restore services that have been subjected to vetoes.” “I’m encouraged that everyone has come to the table to try and find compromise,” added Sen. Mia Costello (R-Anchorage). “We appreciate the Governor’s quick response to our proposal, and we look forward to being with our colleagues in Juneau to wrap up the people’s business.” “It will take a lot of compromise among all 60 legislators and the governor to breach the current impasse,” said House Minority Leader Rep. Lance Pruitt (R-Anchorage). “I appreciate the compromise from the governor and other legislators to change the call of the session, and I’m confident we can move forward on an agreement that meets the deadlines in front of us.” “Alaskans deserve an end to the political turmoil that is disrupting daily life for so many people across our state and causing uncertainty in our economy and communities,” House Speaker Bryce Edgmon (I-Dillingham) said yesterday. “The only way we will get through this is if we set aside our disagreements and come together. This is a significant and encouraging step in that direction.” In addition to changing the location of the call to Juneau, the governor also announced he would be adding several other items to the call: matching funds for federal transportation programs, state matching funds for village safe water projects, funding for the new crime legislation (HB 49), and fixes to the incorrect funding sources named in the final version of the capital budget passed by the legislature in May. Senate Democrats Request Oil Tax Reform Be Added to Special Session Call Today, members of the Senate Democrats sent Governor Dunleavy a letter requesting that he add oil tax reform to the call. Currently, Alaska loses approximately $1.2 billion a year from per-barrel credits. The credit ranges from $8 per-barrel when the price of oil is less than or equal to $80 per-barrel, to $1 per barrel when oil is $140 or more. Governor Sean Parnell promised that oil production would increase to one million barrels per day through the Trans-Alaska Pipeline within ten years with the passage of his oil tax legislation. Current projections by the Department of Revenue predict a continued drop in North Slope production to 470 thousand barrels per day by 2024.“Promises were made by the Parnell administration that Alaska would increase its production to 1 million barrels per day if we overhauled our oil tax structure in 2013. This tax system has not benefited Alaskans like it promised and is outdated at best,” said Senator Bill Wielechowski (D-Anchorage). “If the tax credits were repealed, essential state services would be protected, and there would be enough funds to pay out a statutory PFD.” Senate Democrats are proposing Governor Dunleavy add Senate Bill 14 to the call, but are also open to other proposals from the Administration to revise Alaska’s oil tax structure to ensure the policy to serve the people’s maximum benefit. Alaska is facing massive budget reductions, loss of services, and an economic recession. Lawmakers have received an unprecedented amount of emails, phone calls, and messages to right the economy and reverse budget reductions to provide stability for the state. “Even minor modifications to the tax code could set Alaska back on track to fiscal prosperity, providing reassurances that the people desperately need and deserve right now,” the letter urged. The Alaska Legislature reconvened in Juneau this afternoon to complete work on a capital budget, address this year’s dividend, and possibly seek a path to restore services that have been subjected to vetoes.
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