Dear Friends and Neighbors,
As last Friday, the deadline for overriding the governor’s vetoes, has come and gone, I wanted to provide an update regarding what transpired and what’s next for Alaska.
I would like to briefly say that words cannot express my disappointment at the Legislature’s inability to come together to override the vetoes. Clearly, the vast majority of Alaskans supported or demanded an override. I believe enough Legislators also supported an override, but sadly, deep divisions created by the governor kept legislators away from Juneau long enough for the five-day clock to expire.
However, now is not the time to cast stones. It is my sincerest hope that we can put the division and vitriol aside, forgo any semblance of party-line politics, and come together as a Legislature for the good of all Alaskans. I won’t sugar coat it, there is some bad news to deliver, but I hope the takeaways from this update are that the governor’s actions do not represent the final word, the Legislature has the will and the tools to fix this, and that you, the Alaskan voters, hold the power.
I have never before witnessed this level of outreach from Alaskan residents. Heartfelt and urgent emails, calls, and letters in support of essential services are pouring in from across the state in unprecedent volumes. Earlier this week, the governor amended the special session proclamation by changing the location to Juneau and including the capital budget in the call. As evidenced by this action, your voices are having an effect. I strongly encourage you to continue the correspondence to the other 59 legislators and the governor as it is having a profound impact on hearts and minds in this building.
Let’s discuss what happened last week and what we can do about it. Aside from the governor’s vetoes, actions of note by the administration were the release of the Alaska Marine Highway System’s (AMHS) draft winter ferry schedule and the Office of Management and Budget’s (OMB) confirmation that 53 state accounts would be “swept” into the Constitutional Budget Reserve (CBR).
Regarding ferry service, I personally believe that Cordova’s schedule would have as much of an impact on our community as any of the governor’s vetoes. The administration appears to have crafted the schedule based on profitability instead of need, which is an outrageous lens through which to view transportation infrastructure. The draft schedule (available online at dot.state.ak.us/amhs/share/schedule/considerations.pdf) leaves Cordova and Yakutat without service from Oct. 1 through April 30. Elsewhere in our district, Kodiak and Seldovia will be without a ferry from Jan. 12 through April 30. This is completely unacceptable. Coastal legislators were assured that the level of funding in the budget would avoid a veto and provide year-round service to communities. Looking at the schedule, only the promise of no veto was true.
We need solutions right now, so you are probably asking, what is the fix for this mess?
There are several appropriations bills in play this special session, HB 2001 by the House Rules Committee and HB 2002, which is the Governor’s capital budget. My plan of action is to add operational funding for AMHS back into this year’s budget using one of those bills as a vehicle. I’m having meetings throughout the week with the Finance Committee co-chairs from both bodies, as well as my other colleagues, trying to garner support for such action. I am also meeting with DOT to ascertain what is needed, both in funding increases and schedule tweaks, to provide consistent service throughout the winter. I do not know what the chances of securing additional funds are, but I am hopeful based on my initial conversations. I promise to do everything in my power to try to bargain a better deal for our district.
I believe there is also room in the schedule itself to better serve certain communities. To start with, the Aurora is scheduled for a “cost savings” layup starting Dec. 5 and I would like to see it making runs to Cordova and Yakutat during the winter instead. Additionally, both the Kennecott and the Columbia are in dry dock at the same time this winter and the Tustumena is scheduled for repairs for an unusually long time. I had a meeting with AMHS yesterday and asked them to look into taking the Aurora out of layup for winter runs to Cordova, as well as alternate the dry dock for the Kennecott and Columbia/expedite the Tustumena repairs for runs out the Chain. Additionally, it is my view that some ports need to give up a few runs during the winter in order to facilitate year-round service in places like Cordova, Kodiak, Yakutat and Seldovia. This is our highway, not a business and it should be geared towards providing the best access, not maximizing profits.
That begs the question, how can concerned Alaskans have their voices heard on the winter schedule or ferry budget in general? I would recommend emailing the other 59 Legislators and the governor regarding your concerns. Specific to the winter schedule, DOT is holding written public comment on and considering adjustments to the draft through July 26 via email at dot.amhs.comments@alaska.gov and by fax at (907) 228-6873. Additionally, there will be a teleconference to hear comments and consider adjustments to our region’s ferry schedule at 1:30 p.m. Monday, July 29. The toll-free number to participate in the teleconference is 515-604-9000 and the access code is 279613.
I am holding a Transportation Committee hearing in Cordova on Friday, July 26, to take in-room testimony on the winter schedule because you are affected by it to a greater degree than most communities. As co-chair of the committee, I felt that something with this large of an impact on access to rural communities deserves coverage from the House’s Transportation Committee. Please come down to the Cordova Center from 3 p.m. to 6 p.m. for in-room testimony on Cordova’s winter schedule. Whether you use the ferry system for shipping for your business, school trips, travel, groceries, daily essentials or medical needs, I ask that you please focus your comments on very specific impacts that this schedule would have on you and your family.
Although the format for the hearing will be in-room testimony in Cordova, the committee will accept written testimony from across the state, include it in the written record on BASIS, and forward it to the administration. If you would like to submit a comment for the record, please email it to htra@akleg.gov . Together, I believe we can get to a schedule that works for our communities.
Moving on to the sweep of funds into the CBR: Specific to AMHS, the governor swept the Marine Highway System Fund, the Vessel Replacement Fund, and the AMHS Capitalization Fund into the CBR. OMB is being hazy about the balance of these funds, but upon request, the Legislative Finance Division estimated the balance of the System Fund at $28 million, the Vessel Replacement Fund at $21.3 million, and the Capitalization Fund at $2.6 million. Of all three, only the Capitalization Fund is not used as a funding source in this year’s budget for ferry operations and capital expenditures. What this means is that the Legislature needs to reverse the sweep of these accounts or the impact on service could be worse than it appears if AMHS revenues fall below forecast or unexpected repairs are needed.
The governor also swept ADF&G’s test fishery receipts, which has an unknown balance, the Commercial Fisheries Entry Commission receipts, estimated to be $5 million, and the General Fund Program Receipts, which also has an unknown balance. Although the exact balance of these accounts is unknown, it is thought that these funds represent about 15 percent of the Comfish budget. These funds pay for services that directly affect access to the fishery resource. Talk about penny and pound foolish. The Comfish Division turns a General Fund investment of $60 million into a return of more than $10 billion annually. As far as impacts, the sweep of the test fishery funds is particularly worrisome as it takes revenue from a common property resource that would otherwise go to fishermen.
Other funds of note swept by the administration into the CBR are the Power Cost Equalization Fund, estimated at $1 billion, and the Higher Education Fund, estimated at $341 million. Essentially, the danger here is that all of these funds can be spent on things other than their intended purpose if we are unable to reverse the transfers. That would mean less money for education and more expensive energy in rural Alaska.
I do have some good news on that front. Although nothing is ever certain, I am hopeful that we have more than enough votes to reverse all of the transfers into the CBR.
My goal is to keep you informed so you can collectively tell me what our district wants based on good information. As previously mentioned, the Legislature has several options to address the vetoes and the sweep during this special session. One of those options is HB 2001, which is currently being heard in the House Finance Committee. This legislation contains a $929 PFD, restores all of the governor’s vetoes, and reverses the sweep of all 53 accounts. The current form of the bill represents a starting point for negotiations, and I expect that as it moves through committee on its way to the Floor, compromises will be made on the size of the PFD and concessions will occur on some of the vetoes. Another option for restoring lost funding is through the capital budget, HB 2002.
Which vehicle that is used isn’t important. What is important is a willingness to compromise and quite frankly that onus is on our governor.
The Legislature has compromised. We passed a reasonable, bi-partisan budget that contained the largest single-year reduction in Alaska’s history at $190 million in cuts. Although these cuts were driven in large part by the governor’s agenda, they were formulated through a rigorous process that involved public testimony from every corner of the state. In one fell swoop, the Governor’s vetoes took the budget back to where it was before the public weighed in and legislators conducted months of committee work. This essentially excluded Alaskans from the conversation.
Voters are clearly stating that they want the divisive politics to stop and for us to work together towards the restoration of the vetoed funding. The Legislature is hearing that message, and it is my hope that the governor hears it as well.
As I write this, it is Thursday, July 18, and I just arrived back in Juneau. My plan over the next week is to hold meetings with House and Senate Leadership, as well as my other colleagues to garner support for more ferry funding and the restoration of vetoes to the University, school bond debt reimbursement, ADF&G’s Comfish funding, funding for vulnerable populations, public safety, and etc.
I will be sure to update you as soon as I know more. I’m determined to be a part of the solution and have optimism that we can still fix this. Again, please keep up the pressure with your correspondence. It is amazing to see a populace this engaged and equally impressive to see the effect it is having. It may prove the difference in the end.
Remember, I work for you. If you have any thoughts on the issues I have discussed in this update or anything else that is important to you and your family, please do not hesitate to contact me.
Sincerely,
Louise
