Kreiss-Tomkins: Capital budget and reverse sweep pass! Everything else remains in limbo (with moderate progress)

Rep. Jonathan Kreiss-Tomkins wrote the following update on Monday’s legislative action. 

Four things are causing crippling, historically unprecedented political uncertainty in Alaska right now: (1) devastating, destructive line-item vetoes from Gov. Dunleavy; (2) non-consensus on PFD and its size; (3) failure to pass the capital budget; (4) failure to reverse the Constitutional Budget Reserve (CBR) automatic sweep. And for us in Coastal Alaska, the ferry workers/IBU strike could be thrown in as (5) for good measure.

Items (1) and (2) are politically interdependent. Resolution is complex and will be hard to come by.

But few reasonable minds disagree that passing (3) and (4) makes heaps of sense — the capital budget and reverse sweep* are as straightforward as baseball and apple pie are American. As I previously wrote, failing the capital budget and reverse sweep is nihilistic; it achieves no valid policy outcomes. It just breaks stuff and hurts people.

* What the heck is this “reverse sweep”? Explanation here.


Progress on (3) and (4): capital budget and reverse sweep background

The only reason the capital budget and reverse sweep haven’t passed is that both are predicated on the Constitutional Budget Reserve, and any vote involving the CBR requires a three-quarters “super-supermajority” affirmative vote.

The House Majority has 23 members. The House Minority has 16 members. And one member, Rep. Gabrielle LeDoux (R-Anchorage), is independent of caucus.

The House Minority commands a bloc of votes to fail the capital budget and reverse sweep.

And they have. Three times.

Why? To attempt to leverage the capital budget and reverse sweep for a $3,000 PFD.

I think this was and is ridiculous. In no way are the PFD and capital budget related; failing the capital budget is just taking a political hostage.

The Minority House Democrats attempted the same thing in 2004 looking to leverage their votes to reverse the sweep for more k-12 education funding. The House Minority Dems took the hostage; the Majority Republicans refused to negotiate; the hostage was effectively “executed” (all state funds were swept into the CBR); state services, functions, and ultimately Alaskans (everything dependent on the sweep) suffered the consequences; and six months later the House Minority Dems acquiesced to reverse the sweep to contain the damage. (N.B. The damage of a reverse sweep is probably 5x-10x more than 2004, namely owing UA Performance Scholarships, WWAMI, and Power Cost Equalization all being dependent on funds that are caught up in the sweep, which was not the case in ’04.)

I think the House Minority Dems’ strategy was deeply misguided in 2004. The House Minority Republicans’ strategy this year was equally misguided.


Capital budget and reverse sweep: fourth bite (successful!) at the apple

At 11:52 a.m. this morning, the House took a fourth vote on the capital budget and reverse sweep.

It passed! 31 yeas; 7 nays; 2 excused.


This is great news for Alaska.

I’m also going to get on a soapbox. What did failing the capital budget and reverse sweep for multiple months accomplish?

Absolutely nothing positive. Nothing was accomplished except forcing fear and confusion into the lives of 12,000 University of Alaska scholarship recipients who were told their scholarships had been defunded (and some of whom have elected to go to college outside Alaska as a result); corrosive uncertainty for the construction industry; wasteful inefficiency for millions of payroll equivalent in state-employee capacity who were either burning time prepping contingency plans and/or hamstrung for executing agency missions while waiting for resolution on the sweep. And so much more.


Imagine if we could’ve just passed the capital budget and reverse sweep the first time, on June 12, and avoided this whole dysfunctional and entirely unnecessary mess?

Veto overrides and PFD

There’s no obvious way out of this political bramble patch, but I can share the latest.

By a 21-10 vote, the House passed a bill (HB 2001) that restores ~75% of Gov. Dunleavy’s line-item vetoes.

HB 2001 passed over to the Senate. By a 6-5 vote, the Senate Finance Committee amended into HB 2001 a $3,000 PFD.

You might think, “Whoa, what just happened?!”

It’s a fair reaction. But not unexpected. A quirk of the Senate’s committee composition, the 11-member Senate Finance Committee has a resolute 6-5 $3k PFD majority, whereas the Senate as a whole as a fairly solid 11-9 balanced budget/sustainable PFD majority.

So what’s going to happen?

The Senate has gaveled in — you can watch at! (popcorn recommended) — and, in all likelihood, amend the PFD size down to $1,600, and pass HB 2001 on final passage. (For a variety of reasons, things could messy, maybe really messy, in the Senate along the way, but the outcome I describe is almost certainly the final outcome.)

This no PFD, to $3k PFD, to $1.6k PFD vertigo-inducing roller coaster ride of a legislative process all comes with the price of admission of being an Alaska citizen, I suppose. Hang tight!

What’s next?

The capital budget and reverse sweep go to Governor Dunleavy for signature. Yes, he can veto it. Doing so would be foolish as the vote for final passage exceeds the three-quarters override threshold; I think we as Alaskans can safely consider the capital budget and reverse sweep as being put to bed. Thank goodness.

The PFD amount and operating budget vetoes/partial or complete add-backs are all very much “live.” Negotiations and conversations are underway. The conversations also involve rewriting the PFD formula, constitutional amendments, and more fun stuff.

Just about the only thing that’s certain is that there will be another special session.

Hang in there, Alaska.