JUNEAU, Alaska — Alaska lawmakers want a say in how the state spends more than $1 billion from a new federal aid package, a year after largely ceding decision-making on a prior pandemic-related relief package to Gov. Mike Dunleavy.
Several lawmakers expect debate over how to spend the money to take centre stage in the final weeks of the Legislature's regular session, the Anchorage Daily News reported.
Issues many lawmakers saw heading into session as critical to address or settle, such as Alaska's long-running deficit and the future of the yearly oil check paid to residents from the state's oil-wealth fund, have been overshadowed. Some lawmakers previously said the influx of new federal money should not be seen as an excuse to delay tough fiscal decisions.
Senate President Peter Micciche said the federal aid provides an opportunity “to make a generational change in the economy of Alaska.” The Soldotna Republican said money could be used to retrain unemployed workers, develop infrastructure and prepare the state for the next decade.
The Legislature hits its 121-day regular session meeting limit May 19. The state constitution permits a 10-day extension if enough lawmakers agree to one. Federal guidance on how the money can be spent isn't expected until around May 10.
While some legislatures have delayed decisions on the aid funds for a special session, Alaska House and Senate leaders aren't sure they would have the votes to call themselves into a special session.
“There are a lot of legislators that say, you know, we’re gonna be here for 121 days, that should be enough to get our work done. And so that is our target: Get our work done, and have this done within 121 days,” House Speaker Louise Stutes, a Kodiak Republican, said.
Dunleavy has proposed a broad outline for use of the funds, including aid to businesses and infrastructure investments. It is expected lawmakers will use the proposal as a starting point for their own plans.
Rep. Sara Rasmussen, an Anchorage Republican who sits on the House Finance Committee, said the Legislature wants more control over how the state spends these funds. Last year, lawmakers, who rushed to finish their work early amid COVID-19 concerns, essentially rubber-stamped plans offered by the Dunleavy administration.
Micciche and Stutes, who met with Dunleavy Tuesday, said there’s a general agreement that the federal money will not be used to permanently increase the size of the budget.
In recent years, debate over the size of the check paid to residents from the state's oil-wealth fund has been a dominant issue as lawmakers have relied heavily on fund earnings — long used to pay checks — to also fund government services amid low oil revenue. Lawmakers have settled on an amount to pay for the checks rather than follow a formula some say is outdated and unsustainable. Dunleavy has argued the formula should be followed until it is changed.
Micciche said the federal aid has taken some momentum from efforts to seek a long-term solution. “I mean, politicians, fundamentally, if you can avoid the tough decisions, that’s what many people want to do,” he said.
He said his Republican-led Senate majority would like to see the Legislature spend some of the federal money this session and leave some for later allocation.
Micciche and Stutes said they are optimistic agreements can be reached on a dividend and use of federal aid dollars by May 19.
“It’s going to take a little dancing, but we know the tune," Stutes said.
The Associated Press