Legislative Update: Dunleavy budget flat funds state services

Brian Wildrick, owner of Harborside Pizza, addresses the Alaska Department of Transportation in a teleconference. The meeting, held Monday, July 29, heard feedback on a proposed ferry schedule including a seven-month service gap to Prince William Sound.
Brian Wildrick, owner of Harborside Pizza, addresses the Alaska Department of Transportation in a teleconference. The meeting heard feedback on a ferry schedule including a seven-month service gap to Prince William Sound. (July 29, 2019) Photo by Zachary Snowdon Smith/The Cordova Times

Dear Friends and Neighbors,

Before I get into the legislative portion of this update, I want to express my most heartfelt sorrow and condolences to the friends and family of the skipper and crew of the Scandies Rose. Living in a fishing community, we all understand the risks associated with life on the water. That understanding, however, does nothing to make a tragedy like this more bearable. God bless the souls of all onboard and loved ones as they heal.

Budget update:

On Dec. 11, Gov. Mike Dunleavy unveiled his FY21 proposed budget. As the Legislature analyzes the proposal, I wanted to update you on exactly what is in it, the House’s plan, as well as my priorities for Cordova this upcoming session and budget cycle.

The Governor’s budget essentially flat funds state services compared to last year. This came as a surprise to many when, as recently as four months ago, the governor maintained his intention to seek an additional $600 million in cuts this session. I believe this is clear evidence that Alaskans voices, and perhaps the recall effort, are having an effect.

Let’s look at the specifics. The FY21 proposed budget sustains many cuts from last year, including the $44 million reduction to the Alaska Marine Highway System (AMHS), $3 million from the VPSO Program, $5.8 million from the Alaska Seafood Marketing Institute, $25 million from University of Alaska (UA), $3.4 million from Ocean Ranger Program, $3 million from public broadcasting, and $6.1 million from behavioral health treatment and recovery grants.

New proposed reductions in the FY21 budget include $25 million from UA, $9.4 million from Pioneer Homes, $2.5 million from the Power Cost Equalization program, $1.5 million from rural energy assistance, $16.6 million from Palmer Correctional Center, $398,300 from the Suicide Prevention Council, $3 million from Emergency Medical Services grants, $5 million from Pre-K grants, $232,900 from Online with Libraries (OWL), and $400,000 from behavioral health treatment and recovery grants.

There are increases in the proposed budget as well. Those include $1.6 million for the Office of Public Advocacy, $1 million for Trial Courts, $17.8 million for Department of Corrections out-of-state contracts, $7.4 million restoration of adult public assistance, $27 million restoration of adult dental Medicaid services, and $9.1 million or Alaska State Trooper Detachments.

ADF&G specific budget concerns:

Although the ADF&G budget looks decent by-and-large, I do have concerns regarding several small reductions in our region. In the Westward (Kodiak) Region, there is a $20,000 reduction in weir time for the Frazer Lake weir. This reduction is concerning as it would result in less late-run fishing opportunities for the Kodiak fleet. I will certainly either look to add that funding back or find an alternative funding source to ensure that the weir remains fully operable during the season. In the Central (Cordova) Region there is a concerning elimination of $47,200 for pike suppression projects on the Susitna and Yentena River Drainages. These projects are part of the department’s effort to combat the invasive species Northern Pike, which are decimating sockeye populations on the Susitna drainage. I understand that ADF&G lost the grant funding for this project but is looking for alternative funding sources. I intend to work closely with the department through the budget process to see that these important projects are funded and continue.

Although not exactly a budget concern, I am keenly aware of Cordova’s efforts with ADF&G to expand the tanner crab fishery and open others. One of my specific priorities for Cordova this session is to work with Mayor Koplin, ADF&G, and local stakeholders to ensure that those fisheries occur to the fullest extent the biology supports. The community has been very active supporting the department, with local fishermen offering their input and even their vessels, fuel, and time to support better survey data. The tanner fishery, in my opinion, could easily be expanded with better data, innovative management, and utilizing more local input. 

Once the budget process is underway, I will have more detail and progress on these and other budget items. I will be sure to update you once I know more.

My take on the budget:

Given the governor’s recent statements and attempt to cut $1 billion from the budget last year, some might think this year’s proposal doesn’t look so bad. However, from the perspective of Cordova and other coastal communities, it has two glaring problems.

First and foremost, the proposed FY21 budget validates and maintains a $44 million cut to AMHS that left Kodiak, and many other communities, without winter service. As your representative, restoring ferry service is my highest priority. Second, it kicks the can down the road another year. It does this by offering no new revenue, drawing $1.5 billion from the Constitutional Budget Reserve (CBR), and including a $3,100 PFD. Furthermore, the administration announced that it will seek an additional $1,400 for last year’s PFD through a supplemental request this year. In short, the Governor’s plan would virtually liquidate our only savings account (draws $1.5 billion of ~$1.9 billion fund) to pay PFDs while turning a blind eye to revenue-based solutions and the harmful cuts from last year.

Alaska has a revenue problem, plain and simple. After oil prices crashed, voters tasked the Legislature with reducing state spending. That is exactly what happened. Since 2014, the budget has been cut by almost 40 percent; meanwhile, no significant revenue measures have been passed. Last year, Alaskans loudly and clearly rejected Gov. Dunleavy’s vision of state service levels. The sad truth is, however, that vision is what Alaska will look like without a comprehensive fiscal plan.

As such, my primary focuses this session will be restoring AMHS service, followed by pursuing oil tax reform, some form of a broad-based tax, and long-term changes to the PFD.

The House’s plan:

The Alaska House Majority Coalition’s goals are to pass a responsible budget over to the Senate, discuss new revenue and PFD reform/take what action we can on those, pass a responsible PFD, and be done with the people’s business in under 90-days.

I cannot guarantee that will be happen. What I can say for certain is that we know Alaskans are tired of the gridlock in Juneau, that we are too, and that we will do everything we can to conclude our business within 90-days.

That being said, the issues facing the state are enormous in scope and urgency. The decisions and debate this session will have a long-lasting impact on what type of a place Alaska ultimately becomes: E.g. do we support a statewide ferry system that provides year-round service?

My vow to you is that I will work to complete our business in 90-days while keeping a laser focus and attention on issues that simply must be corrected this year.

Veto override of AMHS funding

On that note, the Legislature has five days from when we convene on Jan. 21 to override the governor’s veto of the $5 million AMHS amendment. Honestly, I do not know if this will be successful, but I am putting in every effort to see that it is. As chair, I am calling a hearing of the House Transportation Committee the day we gavel in session to push for and keep the focus on that veto override. I can’t get into too many details yet, but the hearing will involve a presentation from the Alaska Municipal League and testimony from mayors statewide. The meeting will be viewable live on BASIS. I will update you as soon as we have the details finalized.

2016 pink salmon disaster relief update:

I am pleased to report some good news on a process that many of you have been patient participants in for over three years.

The Alaska Department of Fish and Game, at the urging of my office and a great number of you, officially requested that Pacific States Marine Fisheries Commission expedite permit holder payments for applications without red flags as soon as possible; PSMFC agreed to the request.

After several discussions about the particulars, PSMFC agreed to review applications with ADF&G, identify those without red flags, and start sending full payments to those permit holders in the second week of February. Please keep in mind that this represents a best-estimate and that this process has a demonstrably poor track record of adhering to timelines.

If an application is thought to be missing crew information (seine permits that listed 0, 1, or 2 crew), you should be receiving a letter in the next week from PSMFC requesting additional information/explanation. This information must be returned in writing (email or letter). If an application has a pending crew appeal (crew member was not included or contests their crew percentage), then PSMFC will reach out to the permit holder and request more information.

Out of the two options presented to PSMFC (a partial distribution to everyone with a portion withheld pending crew review or reviewing, prioritizing, and sending full payments to approved applications first), this was what they agreed to.

I understand that this isn’t a perfect solution, and that some of you will still have to wait longer for a resolution. However, I do take solace in the fact that this will result in many disbursements going out earlier than they would have otherwise, while not slowing the process for others. I strongly encourage you to be extremely proactive with information if PSMFC contacts you.

I would like to personally extend my thanks to Commissioner Vincent-Lang and Deputy Commissioner Baker from ADF&G for their willingness to listen, take this on, and approach PSMFC with this request.

I know this news will generate a lot of questions. I just received the word from ADF&G today and still have many questions myself; however, I wanted you to know as soon as we did. I will update the online version of the paper and our email list as soon as we know more. Please reach out to my staff Matt Gruening, at matt.gruening@akleg.gov or (907) 465-3271 or Karla Bush with ADF&G at (907) 465-6153 with any questions.

Remember, I work for you. Please contact me anytime about these and any other issues that are important to you and your family.

Louise Stutes
State House Representative for District 32
Proudly Serving Kodiak, Cordova, Yakutat and Seldovia

(907) 465-2487