State employees anxious as government shutdown threat looms

Retired Alaska Marine Highway System employee Tony Tengs joins other former and current state employees at a rally outside the Alaska State Capitol on June 12, 2019. (Photo by Adelyn Baxter/KTOO)

Earlier this month, Gov. Mike Dunleavy sent a message to state workers telling them to expect layoff or furlough notices after Friday if the Legislature is unable to finish the budget by the end of the special session.

An operating budget is now on its way to his desk. The question is whether it will be enough to prevent a government shutdown on July 1.

As legislators debated inside, about 20 people stood across from the state Capitol Wednesday afternoon with signs urging lawmakers to fund state services and override any potential vetoes from Governor Dunleavy.

It was a quiet gathering compared with many of the protests during the regular session.

Most of the group consisted of current or former state employees like Tony Tengs, who spent 24 years working for the Alaska Marine Highway System. He’s experienced shutdown threats before.

“It’s not a pleasant feeling knowing things could shutdown and you don’t know how to plan your life,” Tengs said. “Fortunately, we made it through those times.”

Whether or not state workers will make it through this time remains to be seen.

An operating budget passed earlier this week, but it’s still awaiting Governor Dunleavy’s signature.

His administration previously warned that he could chose to veto the entire budget. He has not yet not indicated exactly what he plans to do with the budget before him.

Legislators previously managed to avert looming shutdowns in 2015 and 2017, but Minta Montalbo of Save Our State says even when they don’t happen, they take a toll.

“I can speak from experience that yeah, everyone’s feeling nervous and pretty weary of … this cycle of not having a budget and not knowing,” Montalbo said.

It should come as no surprise that state government employment makes up Juneau’s largest employment sector.

But over the past seven years, Juneau has lost 650 state jobs.

That’s according to Meilani Schijvens of Juneau-based research firm Rain Coast Data. She says that accounts for about 15 percent of the local state workforce.

“We’re losing jobs in Juneau at a rate that’s about twice as fast as the rest of the state,” Schijvens said.

That has impacted Juneau’s overall population, which declined for the third year in a row last year.

State job losses are one of a number of contributing factors, but Schijvens says budget instability also has a direct impact on Juneau’s business community, where confidence declined again this year in a poll of local business owners.

“We see business owners… just trying to batten down the hatches and make sure their businesses are stable rather than being in a business expansion mode,” Schijvens said.

Unions representing state workers are hopeful, but they’re also advising members to be prepared even if a shutdown on July 1 doesn’t necessarily mean layoffs for everyone.

Jeff Kasper was also at the rally. He’s the Southeast manager for the Alaska Public Employees Association, representing nearly a thousand members in the region.

“We’ve got agreements with the administration in case there was a shutdown that employees would be protected and go on furlough instead of being laid off,” Kasper said.

His colleague at APEA, Business Manager Brian Penner, says even still, the disruptions to state programs would be large.

“We’re getting contacted by employees talking about enormous projects that have gone out where you know an incredible amount of money has already been invested,” Penner said. “It’s money that will never be recouped, and it’s projects that are going to cost that much more money.”

Legislators are hoping to avert a shutdown, but whether they have the votes to override line item vetos is unclear.

Juneau Senator Jesse Kiehl agrees that shutdown threats have costly impacts at a time when the state is already facing budget cuts.

“It all adds up, and state governments shouldn’t waste money,” Kiehl said. “They also shouldn’t jerk people’s lives around.”

Employee contracts require layoff notices to go out a minimum of 10 working days ahead of time, which is Monday.

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