In stalemated Legislature, ‘Musk Ox’ may hold the key

The Legislature is on Day 126 of what was supposed to be a 90 day session — leaving many Alaskans wondering, what’s taking so long?

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Homer Republican Paul Seaton on the House Floor on May 24, 2016, the second day of the Legislature's fourth special session. (Photo by Rachel Waldholz, Alaska Public Media - Anchorage)
Homer Republican Paul Seaton on the House Floor on May 24, 2016, the second day of the Legislature’s fourth special session. (Photo by Rachel Waldholz, Alaska Public Media – Anchorage)

Lawmakers still have to pass a budget for the coming year, and figure out how to fund it.

But Democrats have made it clear they won’t vote for a budget unless the legislature also makes changes to the state’s oil tax system.

On that front, they’ve been joined by some Republicans.

How well that coalition hangs together may decide how things shake out in Juneau.

House Speaker Mike Chenault, R-Nikiski, will tell you there is just one problem in Juneau — and it’s a math problem. 

“We’re still here because we haven’t put together a budget that we can get 30 members to agree to,” Chenault said. “That’s why we’re still here.”

Thirty members is three-quarters of the House. That’s the support Chenault needs to pull money from the state’s traditional rainy day fund, the Constitutional Budget Reserve. Chenault only has 26 members in his Republican-led majority, so he needs the support of House Democrats. Whatever they agree to also has to pass muster with the Republicans who control the state Senate.

Getting those three factions to agree is hard enough. But Chenault is also facing divisions within his own caucus.

Those divisions became crystal clear on one vote: oil taxes.

Several members of Chenault’s House Majority joined with Democrats to pass a sweeping overhaul of the state’s oil tax system, over the objections of the Republican leadership.

Homer Republican Paul Seaton brokered the deal in the House, along with Tammie Wilson, R-North Pole.

“Oil tax credits are one of the largest expenditures in our state,” Seaton said.  “I don’t see how it’s fiscally conservative to say we can cut K-12 education but continue oil tax credits on the North Slope at the rate we are.”

Seaton and others have been called the “Musk Ox coalition” a name coined by Palmer Republican Jim Colver after the same group “circles up” to oppose using Permanent Fund earnings in last year’s budget battles.

It also includes Republicans Louise Stutes and Gabrielle LeDoux, and rural Democrats Neal Foster and Bryce Edgmon, who normally caucus with the Republicans.

Throw in Juneau’s Cathy Munoz, and whether you call them the Musk Ox coalition, or members of the Bush or Coastal Caucus (as they’ve been called in the past) or just plain moderates: right now they’re essential for almost any deal. Especially on oil taxes.

“They’re in the driver’s seat in the sense that you can’t get to any deal without including them,” said Jim Lottsfeldt, a lobbyist, political operative and longtime legislative watcher.

The majority has always had divisions, Lottsfeldt said. When the state was flush with money, leadership could paper over some of those differences by doling out funds for projects back home. But with this year’s meager capital budget, that’s no longer an option.

And the issues on the table are important enough that core philosophical differences are asserting themselves, overriding caucus loyalty.

Their key role has made the ‘Musk Ox’ into targets. Suzanne Downing, the communications director for the Alaska Republican Party, called out the lawmakers by name in her newsletter as the special session began.

“I feel like we’re kind of being targeted because we’re trying to work together as a group of legislators,” said Louise Stutes, R-Kodiak.  “For the Republican Party to target us when we’re trying to do the job that we’re sent down here to do — and that means working with everyone that’s here, not just working with Republicans.”

In the past, Lottsfeldt said, someone has stepped forward with a strategy to close out the legislative session — whether it’s leadership in the House or Senate, or the governor. But so far this year, nobody has taken the reins.

And ultimately, he said, it’s not unexpected that lawmakers are having trouble getting out of Juneau.

“Let’s say oil tax credits was the only issue the legislature was dealing with. They would still be wrapped around the axle, because it’s a tough issue,” Lottsfeldt said. “But not only are they dealing with that tough issue, they’re dealing with — income tax is an idea, changing the Permanent Fund, drastically reducing the state budget. There are just so many big issues right now that it’s no surprise it’s such a cluster.”

Lawmakers have until June 1 before state workers start receiving layoff warning notices. If there is no budget by July 1, the state could face a government shutdown.