No budget deal yet as Alaska Legislature prepares for the end of its regular session

    Senate President Gary Stevens, listens to Senate Rules Committee Chair Bill Wielechowski, and Senate Majority Leader Cathy Giessel, Tuesday, May 16, 2023 (Photo by James Brooks/Alaska Beacon)

    Juneau, Alaska (Alaska Beacon) - Negotiations are continuing into the last day of the 121-day regular session, legislative leaders say.

    The Alaska Senate ended the penultimate regular day of the state’s legislative session without advancing work on the operating budget needed to avoid a government shutdown on July 1.

    Senate President Gary Stevens, R-Kodiak, said the session may end on Wednesday without a vote on the Senate’s proposed $6.2 billion “take-it-or-leave-it” budget

    The Senate will not advance the budget to the House of Representatives without agreement that it will pass and go to Gov. Mike Dunleavy, he said.

    If there’s no agreement, he expects Dunleavy to call a special session that will allow legislators to continue negotiating.

    “It’s all up in the air. Still. I know it’s the last minute. But we just don’t know what the House is willing to agree to,” Stevens said.

    Sen. Bill Wielechowski, D-Anchorage and a member of the Senate majority’s leadership group, said the deadlock can be boiled down to a single issue.

    “There’s a lot of different items, but the big one: We all want a bigger dividend, and how do we get there?” said Sen. Bill Wielechowski, D-Anchorage.

    Speaker of the House Cathy Tilton, R-Wasilla, said there are more issues involved, including the amount that the Legislature will increase education funding and projects within the state’s capital budget.

    The Senate’s budget proposal, which would pay for services and construction projects for 12 months beginning July 1, includes a Permanent Fund dividend of about $1,300 per recipient.

    The House has previously voted in favor of a $2,700 Permanent Fund dividend but hasn’t found a way to pay for that amount.

    The House budget contains a deficit of between $600 million and $900 million, depending on the estimate used, and that figure would have to be covered from the budget reserve.

    Spending from the reserve requires the approval of three-quarters of the House and three-quarters of the Senate. 

    The House couldn’t muster those votes earlier this year, and the Senate remains mostly uninterested.

    Stevens said he personally would be willing to vote for a small draw from savings in order to increase the dividend beyond the $1,300 approved by the Senate, but other senators said they aren’t interested in that idea, and the House’s 16-member minority caucus also has spoken against it.

    Other proposals have been floated in House-Senate leadership meetings, Stevens said, including the possibility that the House might approve the budget in exchange for a vote on constitutional amendments guaranteeing the Permanent Fund dividend or tightening the state’s spending cap.

    But both of those ideas lack the support to leave the House, meaning they can’t be considered by the Senate.

    Stevens said lawmakers are considering other ways to boost the Permanent Fund dividend in response to House requests, but as of Tuesday evening, there had been no success and no agreement.

    Tilton said Tuesday night that she and other members of the House are continuing to negotiate with the Senate. Both she and Stevens said Dunleavy has been involved in the talks as well.

    Overall, she said, she’s been disappointed by the process that has led the Legislature to this point. The Senate should have passed a budget that allowed the House to work on the capital budget in public, she said.

    “It’s really about process. And we really want a good process for Alaskans,” Tilton said. “Each one of us represents about 18,000 Alaskans, and I think it’s important to have good process. And that’s one thing we’re going to talk about tonight, because these things shouldn’t be done behind closed doors without the public knowing what’s happening.”

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