Special Session Sneak Peak

August 14, 2021

Dear Friends and Neighbors,

We’re going back into session on Monday. So it’s a really busy weekend⁠—we’re finalizing recommendations from the Fiscal Policy Work Group. (Thank you again to everyone who wrote or called with ideas!) And I hope you're reading this back at home after turning in a day's worth of scholarship fish in the derby!

Reps. Story, Hannan, & I thanked Gordon Jackson for his years of dedication to rural education, health services, and economic development in Alaska.

Taking Hostages

The agenda for this special session has changed, and not all for the best. We need to appropriate money for this year’s PFD, and consider whether to override the governor’s vetoes or supplement with additional funding. And of course, we need to work on the big picture fiscal issues.

But there’s a catch. When an Alaska governor calls a special session, s/he gets to set the agenda. (Except veto overrides—we can vote on those no matter what.) When the governor agreed to give the working group more time, he surprised us by narrowing the scope. He’ll still let the legislature consider a tighter constitutional spending limit, constitutionalizing the PFD & PCE, and new revenues. But he took away the ability to reverse the sweep or pay the PFD.

His current position amounts to: give me the constitutional amendments I want and then I’ll let you pay the PFD I want. When I talk to other legislators, they like that treatment about as well as a poke in the eye with a sharp stick. The legislature’s not going to change the constitution just because the governor is trying to hold this year’s PFD hostage.

(Also, does it strike you as weird that his entire brand is 'all PFD checks, all the time,' but he vetoed this year's dividend and is now forbidding the legislature to fix it? He's literally put himself between his political base and this fall's direct deposit. I'm no marketing expert, but I'm not sure how he plans to sell that.)

Unswept

Great news on Power Cost Equalization! Thanks to a hot-off-the-presses court decision this week, rural Alaskans' electric bills will be back to normal.

To recap: The Alaska Energy Authority holds a $1.2 billion fund and the earnings pay for the program. For a long time, no one considered that endowment "sweepable,” so it stayed invested, letting us use Wall Street's money for Alaskans' electricity regardless of whether the legislature got a super-duper majority vote (3/4) every year on budget stuff.

Then Gov. Dunleavy’s first Attorney General decided the PCE endowment was sweepable after all. That meant the fund could end up in one of our cash savings accounts instead, earning no income and likely getting burned through in a single year to pay for services or PFD checks. The Alaska Federation of Natives brought Gov. Dunleavy to court—and won.

So PCE will be paid this year, and it's at much less risk in the future. There are lots of other programs still waiting on that 3/4 vote, but it's good to have this critical one settled!

Rep. Hannan & I honored the memory of Cy Peck, Jr. A radio host, historian, spiritual guide, and more. Cy touched the lives of many in Southeast Alaska. (Rep. Story arrived moments after this picture.) We presented the citation to his niece, Dorothy Webster.

And the winner is...

A while back, I offered lunch to whoever best predicted the new revenue ideas the governor would put forward. We already knew about expanded gambling, so that was out of the contest, but his team told us there would be new proposals Alaska hasn't done before.

Last week, his Commissioner of Revenue presented a series of revenue possibilities the governor wouldn’t outright veto if the legislature passed them. (That's as close as this governor is ever likely to get to endorsing a tax. We'll take it.) It was a surprisingly big list. He also continues to push for legalizing and taxing every form of gambling ever imagined, which gives me the collywobbles.

There are some good ideas there: 1) lowering the top per-barrel oil tax credit from $8 down to $5. That has potential. 2) expanding the corporate income tax to cover Hilcorp, which bought out BP's interests in Alaska. Because Hilcorp has a different corporate structure, we need this change just to keep a level playing field with other oil companies. 3) a small increase to the motor fuel tax. No brainer. 4) selling carbon offsets by promising to conserve state land. Not big bucks, but a lot of opportunity there.

Other ideas I don't fully understand. The governor has some sort of plan to try to tax corporations that sell digital services and ads in Alaska—not through a sales tax, but through the existing corporate income tax. I'm a little worried it's part of a nation-wide attempt to 'get back at' social media companies who kicked a recent past president off their platforms. But if the proposal is serious, I have several dozen questions, mostly about how we'd determine who owes what, or how we'd enforce it.

You’ll notice none of the governor’s suggestions include an income tax. There were two different flavors of sales tax. Both are very regressive, meaning struggling Alaskans would pay on every nickel they make by taxing basic necessities like rent and food, while comfortable Alaskans would only pay on a portion of what they bring in. It’s good to see some agreement from the governor on the need for revenues, but there’s a lot of work left to be done.

So who won lunch? Well, the only one of those things folks actually predicted was gambling, which we already knew. But major cleverness points go to the two folks who thought the governor might propose 1) a tax on solar-powered brothels, 2) a special excise on oosiks, and 3) taking the entire Permanent Fund Earnings Reserve Account to the roulette table and covering black. Those made me laugh loudly enough I'll spring for lunch.

All my best,

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Events & Happenings Around District Q

Juneau: Egan Highway is Lava!

An easygoing half-marathon, open to all ages and motorless forms of transportation! From Devils Club to Forbidden Peak (either direction.) Don’t let the rain bog you down - the event runs from Aug. 13 – 22 so aim for one of the prize categories and have some fun!

Discover Eaglecrest Day!

Juneau’s community-owned ski area is truly one of Alaska’s hidden jewels. Come explore and play: chairlift rides, hiking, biking, disc golf, grilling, and more—check it out Aug. 28!

Juneau Food Fest & Farmers Market

It’s an awesome free community event celebrating Alaska Grown & Alaska Made food, crafts, and more! Downtown at the JACC/Centennial Hall August 28.

Capitol Tours

Our awesome friends at the City Museum are back giving FREE tours of the Alaska State Capitol! Learn about the building’s proud history and stop by my office (Rm 419) to say hi!

Haines Market

You know it, you love it, and you need it for all your fresh foods! The farmers market happens every Saturday through mid-September 10 am – 1 pm. Don’t miss out!

Skagway High School XC Meet

Mark your calendars for a return to school sports. It’ll be the first cross country meet for the region! Come cheer on your favorite runners!

Skagway Klondike Road

Relay 2021 (kinda)

The run must go on! With differences! Sept. 10 - 11 gather your squad for this annual favorite. US & Canadian teams will run different legs. The ones that finish in Skagway (yes, finish) will have an afterparty with live music, food, and brews!

Klukwan Books! (And a prize!)

Check out books at the Klukwan Community Library and get a chance to win “Traditional Food Guide” from SEARHC Health Promotion!

Klukwan Food Sovereignty

The Tribal Council approved a new round of food sovereignty funds for Klukwan residents last month—applications will be processed in the order they’re received.