Legislature seeks new path to fund vetoed programs

While the Legislature failed last week to override Gov. Mike Dunleavy’s vetoes, lawmakers are trying again to fund the vetoed programs in a new bill. A draft bill the House Finance Committee discussed on Monday would also set permanent fund dividends at $929 to have a balanced budget. 

House Bill 2001 would both reverse Dunleavy’s vetoes to the operating and capital budgets and set the dividend level. 

Rep. Neal Foster, D-Nome, co-chair of the House Finance Committee, speaks in support of a bill during a House floor session in Juneau in March. On Monday, Foster said the Legislature would have to make further budget cuts or draw from savings to have permanent fund dividends more than $929. (Photo by Skip Gray/360 North)

Rep. Neal Foster, a Nome Democrat, said the Legislature must draw from savings or make further cuts to have dividends more than $929. He added that dividends would be $1,490 if all of Dunleavy’s vetoes are maintained, without further cuts or draws from savings. 

“I’m not saying that that’s what the PFD is going to be,” Foster said. “This is certainly a starting point.” 

The bill also would pay for budget items like Power Cost Equalization and college scholarships. They don’t have a funding source since money for these programs has been swept into a state savings account

It’s unlikely the bill would become law in its current form, since it reverses Dunleavy’s vetoes and could be vetoed by him. It also would require support from Republican lawmakers aligned with Dunleavy. 

Members from the House majority flew up from Juneau to hold the House Finance Committee meeting at the Anchorage Legislative Information Office. Members from the House minority, which has been meeting in Wasilla, also attended the committee meeting. 

Wasilla Republican Rep. Colleen Sullivan-Leonard questioned the new bill’s legality. She said that it goes beyond Dunleavy’s call for the special session, which is limited to funding full permanent fund dividends. 

“I have grave concerns with what is before us,” Sullivan-Leonard said. “My understanding was that the second special session call was very specific to the permanent fund dividend. And (that) was not a budget bill.”

A lawyer for the Legislature said the courts haven’t weighed in on how far a special session can stray from what’s on the call. The Washington State Supreme Court has said in that state there has to be a rational connection with the special session’s subject. Foster said the budget and the PFD are connected because the Legislature has to say how they’ll pay for the dividend. 

Dunleavy spoke to the press before a cabinet meeting on Wednesday. He didn’t comment on the new bill. But he did express hope there would be progress in talks with the Legislature. Lawmakers and state officials have said that the state stands to lose federal transportation funding if the Legislature hasn’t passed a capital budget by the end of July.

“We all realize that we’re running out of time,” Dunleavy said. “And we all want a closure to this legislative session. We all want what’s best for Alaska. We have different ideas on how to get there. But I feel strongly that we’re moving closer together and I’m pretty optimistic.”

There hasn’t been visible progress from the talks between the Legislature and the governor so far. 

Monday was the first House Finance Committee meeting since there were changes to the committee, following former co-chair Tammie Wilson leaving the House majority. Anchorage Republican Rep. Jennifer Johnston is the new co-chair. Fairbanks Democrat Rep. Adam Wool joined the committee.