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The Alaska Legislature is no different than a typical American household — torn between spending every last dollar from their paycheck on immediate wants or saving some for the inevitable future needs. When the wants win out, money often is short for the needs that come later. That pretty much sums up this year’s political battle over the amount of the Permanent Fund dividend. The bipartisan Senate favored an affordable PFD that would not require drawing from savings; the House Republican-led majority wanted to take hundreds of millions of dol...
Elected officials, ballot initiative supporters and opponents, campaign managers and anyone else who writes, texts or tweets outlandish claims and promises should be required to stay after the election and write on the blackboard (remember those) 100 times: “I will not make stuff up.” After they have a chance to rest their arm, they need to go back to the board — OK, a whiteboard and a Sharpie works, too — and write 100 more times: “I am sorry for promising too much.” It’s gotten way too easy for anyone trying to win over the public to pro...
The great debate in Alaska over taxes sounds similar to the age-old question of whether it is less painful to yank off the bandage quickly or peel it off slowly and gently. I have found that it just doesn’t matter all that much how I pull off the bandage. Neither way is pleasant, especially when there is scab underneath. It’s the same for taxes in tax-free Alaska: None of the options are pleasant; all will hurt at first; there are a lot of political scars and scabs that will break open no matter what tax is adopted, an income tax or a sal...
Most Alaska state budget watchers follow oil prices, fully realizing that they can bounce around like a small plane on a windy day, creating that same stomach-churning queasiness when they drop. The estimated difference between Alaska North Slope crude averaging $70 per barrel over the next fiscal year is $650 million less in state general fund revenue than at $80. That’s close to 10% of the general fund budget and enough to either leave a gaping hole in the spending plan or add some extra money to savings. Oil down at $60 per barrel means an a...
Legislative leaders focused on the Permanent Fund dividend and taxes as they described the budget choices facing lawmakers trying to find a combination that will win enough political support to balance state spending. “The dividend has been the massive rock in the middle of the road,” making it difficult to find an affordable path to a long-term state fiscal plan, Anchorage Sen. Cathy Giessel, the Senate majority leader, said during an online discussion with Alaska Common Ground last week. “The dividend provides a lot of benefits to Alask...
Gov. Mike Dunleavy told legislators in a pair of closed-door meetings last week that he will introduce a state sales tax as a component of a budget-balancing, long-term fiscal plan. But with just three weeks left in the legislative session, with no details about the governor’s tax bill as of Monday, and with strong opposition from lawmakers who represent communities with a local sales tax, the odds of passage this year are extremely low. If the governor goes ahead with a sales tax bill, it would join more than a dozen proposals offered by H...
Alaska is 30 years into state budget deficits, borrowing billions from savings to pay the bills. Gov. Mike Dunleavy is five years into the job, still pledging mega Permanent Fund dividends even if the money isn’t there. Three months ago, Dunleavy in his State of the State address couldn’t even manage to acknowledge the need for a long-term fiscal plan, despite the budget math that adds up otherwise. Then the governor had an epiphany last week. Not a religious one, a fiscal one. He said the word “taxes.” Only he didn’t say it in public. T...
The state should change its tax code to increase corporate income tax collections from out-of-state businesses that sell goods or services to Alaskans, particularly digitized services, according to a legislator promoting the revisions. “The world has changed,” said Anchorage Sen. Bill Wielechowski. “We’re no longer bricks and mortar.” His legislation would amend Alaska’s income tax code to ensure that online and digital sales are included in calculating how much of a company’s U.S. profit was made in Alaska and should be subject to corporate...
The Petersburg School District would receive another injection of one-year additional state money under a budget headed toward approval in the Alaska House, falling short of a permanent increase in the education funding formula sought by school districts statewide. Under the House budget, state funding for K-12 public education would increase by about 14% for the 2023-2024 school year. The state’s foundation funding, based on enrollment, covers about 65% of the Petersburg district’s total general fund budget. The Republican-led House maj...
Pointing to high credit card balances, growing student loan debts and inadequate savings for many U.S. households, Anchorage Sen. Bill Wielechowski believes it is important to teach students “to avoid common financial pitfalls and manage their money successfully.” He has proposed legislation that would require Alaska high schools to teach a financial literacy course. His bill also would require that students complete the course to earn their diploma. The course would have to cover managing a bank account, setting a budget, credit card deb...
Three-term Nikiski Rep. Ben Carpenter is right, the state needs a sustainable, long-term fiscal plan. Give him credit for raising the issue. Talk of a balanced fiscal plan has lingered since 1990 — before several of today’s legislators were even born. The discussion about diversifying Alaska’s economy has lasted even longer, ever since the first oil started flowing from Prudhoe Bay in 1977 and we tried using the riches to expand the state’s economy and job opportunities beyond crude. But unless new business activity produces oil, any new indust...
A state senator wants to direct a larger share of filing fees paid to the court system toward a nonprofit legal aid organization that helps several thousand Alaskans a year with their domestic violence, family law, housing, elder advocacy and other cases. The 56-year-old Alaska Legal Services Corp. “is part of our social safety net,” helping the most vulnerable community members, particularly survivors of domestic violence, said Anchorage Sen. Forrest Dunbar, sponsor of the legislation. Senate Bill 104 would amend state law to direct up to 25%...
˛ Alaska Department of Fish and Game has reduced this year’s non-hatchery Chinook catch limit for Southeast commercial trollers by 44,000 fish — about 23% lower than last year’s harvest quota. The catch limit for sportfishing, commercial seine and gillnet fleets also were set about 23% lower than last year. The largest salmon are the main moneymaker for many trollers. This year’s harvest limit, while down substantially from 2022, is about the same as was set for 2021 and 2020. It’s almost 50% higher than 2019, when several runs were not expect...
Similar pieces of legislation to increase state funding for public schools are awaiting hearings in the House and Senate finance committees as lawmakers face a mid-May adjournment deadline and school districts make spending plans for the 2023-2024 school year. The House bill, which was amended and moved out of the Education Committee on March 22, would increase the funding formula by a little over 11% in the first year and 2% in the second year, about half of the bill sponsor’s original proposal. The Senate version, which moved out of its E...
It’s embarrassing that it took billions of dollars in losses for some legislators to acknowledge that the state’s fiscal house is leaking worse than a broken downspout on a Southeast Alaska roof. It’s too bad Gov. Mike Dunleavy acts like he has barely noticed the growing pool of mud at his feet. Start with the Permanent Fund, which generates investment earnings that have become the largest single source of revenue in the state budget. Last year was painful for most every investor, and Alaska was not immune to the downturn. The fund dropp...
Though Wrangell appears to have led the state with its overall 56% increase in assessed property values this year, residents in Petersburg, Juneau and the Matanuska-Susitna Borough also are receiving significantly higher assessment notices in the mail this month. Cordova, Nome and Valdez, too. Average home values in the Alaska communities are up 10% to 20%, part of a nationwide trend of rising property values the past few years as construction costs escalated, the supply of homes for sale was tight and buyers tried to close on deals before...
The Alaska Marine Highway System is short more than 100 new crew to safely and dependably put the Kennicott to sea. Without enough onboard workers, the state ferry system will start the summer schedule in six weeks with its second-largest operable ship tied up for lack of crew. Though management has said they could put the Kennicott into service if they can hire enough new employees, filling all the vacancies would represent more than a 20% gain in current ferry system crew numbers, setting a very high hurdle to untie the ship this summer. The...
After years of legislative debate over the size of the Permanent Fund dividend, reasonable voices are starting to grow louder, maybe even hopefully strong enough to outvote the irresponsible catcalls for an unaffordable dividend. It’s a welcome change. A bill in the House would restore dividend sanity by setting the free-money check at a percentage of the annual draw of Permanent Fund earnings, producing about a $1,300 PFD this year and growing from there. That would be about equal to the average dividend of the past decade, before the e...
Just eight weeks before the start of the summer timetable on May 1, the Alaska Marine Highway System has released its schedule and opened its online reservations system for bookings. The schedule, which was announced March 7, came later than usual this year as the state continues to wrestle with crew shortages that will keep a couple of ships tied to the dock for the summer. Petersburg will see a weekly ferry stop in each direction May through September. “The Kennicott and Tazlina will be off-line for the time being due to skilled crew s...
When Jan Kanitz of Juneau and Antonia Lenard of Eagle River testified before a legislative committee last Saturday about personal responsibility and the Permanent Fund dividend, they spoke from completely different perspectives. For Kanitz, it was about acknowledging that current state spending on schools, health care and the ferry system is woefully inadequate, with too much emphasis on paying out large dividends. “I think a fixed, limited PFD as a symbolic thing helps people have buy-in to the state … I support that, but it should not ban...
State officials have known for months that delays in processing applications for food stamp benefits were denying financial assistance to thousands of eligible households — including children — who needed help to afford three meals a day. There were multiple explanations: Longstanding staffing shortages, a cyberattack on the computer system two years ago, more paperwork and income verification requirements after the state ended its pandemic emergency declaration months earlier. But children cannot swallow explanations, especially ones far pas...
The Alaska Marine Highway System is working faster to hire more crew, trying to fix problems that slowed the process so much the past four years that the state failed to keep up with retirements and resignations. The hiring process was so cumbersome and excessively choosy that the state brought aboard just a few new workers out of 250 applicants forwarded by a search agency over the past year, according to a January report from the recruitment contractor. “Since 2019, AMHS has lost more staff annually than recruitment efforts can replace. F...
A state House committee last week held its first hearing on a bill intended to settle the Legislature’s biggest annual political battle: The amount of the Permanent Fund dividend. The bill, sponsored by Rep. Dan Ortiz, who represents Ketchikan, Wrangell and Metlakatla, would amend state law so that 75% of the annual draw on Permanent Fund earnings goes toward paying for schools and other public services, with 25% designated for the PFD. “Tonight, we’re going to open a can of worms,” Chairman Ben Carpenter, of Nikiski, said at the March 1 meeti...
In a change of plans from just a few weeks ago, the Alaska Marine Highway System reports it lacks enough crew to operate the Kennicott this summer. The loss of the Kennicott from the schedule likely would mean dropping service to Prince Rupert, British Columbia, and the loss of two additional port calls in Petersburg each month, May through September. It also could jeopardize state ferry service to Yakutat on the cross-gulf route, and abandoning plans to run the Kennicott to Bellingham, Washington, once a month to help move the heavy load of su...
Alaska’s senior U.S. senator — and former state legislator — Lisa Murkowski addressed a joint session of the Legislature last week, covering the usual issues of oil and gas, economic development and lots of federal dollars for local projects. Her remarks were pretty routine for anyone who has listened to the annual speeches at the Capitol by Alaska’s two senators over the decades. That’s the comforting thing about Alaska politics — the issues don’t change much. We’re like an old TV sitcom where the characters don’t age and the same problems...
