I wish I could report that things are wrapping up in Juneau, but ...... I have added my own take to what you will find in the page below.

So what's transpiring? And why aren't things wrapped up? It boils down to the House Majority insisting on implementing a new broad-based tax and raising existing oil taxes, while the Senate Majority has no interest in these taxes. It also hinges on differences in views on the bill that would restructure the Permanent Fund (and result in lower PFDs)

- Special Session Issue Update -
including...

- Senator Hughes Take on the Points of Consensus -
- "My Take on the Points of Consensus" -

Now for an update on the eight items on the special session call...but before I provide that....

Allow me this week to point out what I see are the points of consensus among the House and Senate Majorities and Minorities - among most if not all 60 legislators - as a way to direct us to a solution and finish the work at hand. The governor plans to present a "compromise package" soon, but I'm guessing it will involve less dollars in the hands of Alaskans (poor idea when we're in a recession) than what I propose.

I believe, in order to work together to get the job done, these three areas of agreement should be our focus:

1) The budget passed by July 1 - it could be argued that this one should go without saying, but because of all the revenue distractors out there, I believe we need this reminder. It's our one and only constitutional duty - and no one wants a government shutdown if we can avoid one. Haggling over tax revenue measures doesn't need to impede the budget process (number 3 below provides the alternative). Those that want to haggle can always still do so after the budget is passed.

"1A Time for real budget cuts to happen. Each bill on the floor for the budget needs to be gone through item by item and given a up or down vote by both House and Senate. To many unpopular items have been attach to budget items that need to be funded, only because they would never pass by their own merits, on their own. Watch this link and you will understand what I mean by this" Politadick

https://www.facebook.com/politadick/posts/1407866202607730

2) Elimination of the cashable oil tax credits - we all realize we can't afford to be paying out cash anymore to stimulate exploration and production. We can agree on this point. We can also start saving about $100 million to $200 million per year if we pass the bill that's on the table that will eliminate the cashable credits (HB111). There's not agreement at all though on the issue of raising taxes on the oil industry, so this point should be dropped.

"2B Tax credits should be a no-brainer to answer. Never should have been started in the first place. 3 billion given away with 0 return on the investment. No new taxes on oil this year. Wait till President Trumps tax reforms are completed. You will have the leverage you need after that to increase State taxes on oil. Especially if it gets lowered to 15%" Politadick

3) Use of some earnings reserve to pay for government services for the first time - I'm fairly sure that all 60 legislators realize the math problem at hand, and that they agree that the only way to fill the gap left by oil prices that plummeted, is to use some of the interest income off the Permanent Fund (not the principle). There's not agreement though on how or whether to restructure the Permanent Fund or how much or whether to reduce the PFD or how or whether either or both of these things should be accompanied by new taxes or increased old taxes and which taxes.... The list of the tangled web of positions is long when it comes to disagreements, but the point of agreement - to use some of the earnings reserves - is something we all agree is part of the mathematical solution. Why not agree to a simple, moderate draw of earnings reserves for the first time? A draw in its purest form - no taxes, no restructure, just a simple draw. And wow, just think: if we agreed on this one point today, we could wrap things up, pass the budget, and adjourn in short order!

"#3C Use plan #1A by doing this you will find that the next years budget will drop by 2 Billion dollars in short order. The remainder can be funded by the State Savings Account or the Slush Funds that are sitting there. Oopsie daisy, I forgot that is now a Four Letter Word.

Now if you look at the school budget. Since 1996 there was 156,000 eligible kids to go to school in K-12. (#'s gathered from the Alaska State Census) Budget was 1.6 billion dollars then and This included UAA. Now the population had grown to 160,000 kids, the Disability Act was passed in 1999 budget now at 1.8 billion and the same in 2000. 2001 2.0 billion. January 8th 2002 the No child left behind act is passed. Budget is now 2.1 billion. 2003 jumps to 2.3 billion due to the new bill increases of cost. 2004 is the last year for 160,000 kids average, budget still 2.3 billion dollar. Number of kids going to school at this point begins to decrease each year and by 2007 is 156,000 eligible kids and the now the budget is 2.6 billion dollar.

Pay attention now, remember Since 2004 the # of students keeps dropping but the budget keeps getting bigger. Now here comes the Kicker. Obama is now elected president and its 2008 budget jump 400 million to 3.0 billion dollars and there are 154,000 eligible kids. By 2013 the budget hits a all time high of 3.7 billion dollars. Then it begins to drop to 3.5 billion dollars in 2016, also from 2008 to current the number of kids has maintained 154,000 average a year. There is No coincidence the drop of the budget coincides with the Oil credits that are being given and we enter a recession on oil prices. (had to pay for their bad decision and the money has to come from someplace, #1 take our PFD's last year and this year, budget cuts again for the school district for the second year in a row). The current budget that they have and with reports that the number of kids going to school in 2017-2018 is suppose to decrease. The cuts shouldn't affect the lack of performance of the schools, we only rank at 47th out of 50 states this year anyways, our kids are coming out of school dumber now then in 1996 when the budget was 2 billion less than it is now.

(https://www.facebook.com/politadick/posts/1410267339034283).

Its clear that money isn't helping them learn. Budget could easily be dropped to 3.0 billion dollars with restructuring of the school system.

We could also do reforms to Welfare Programs, Snaps, energy assistance, housing, these three alone with work requirement, if able body and if your excuse is where I live I cant get a job, then its time to move where you can get a job, welfare is not a lifestyle when you are capable of working, They are there for people who are unable to work because of health, age, disabilities, you get the point people who really need it, not someone who is able to work but chooses to live where they can't get a job and have turned the system in to a way to make a living off of other peoples hard work in the form of taxes.

Healthcare Reform (Travel costs Rural Area's)" A simple $50 dollars per month per person living in rural areas for travel cost, they choose to live there, it shouldn't be the responsibility for Alaskan Taxpayers to cover their choice. 20 million so far spent on Rural are travel expenses for healthcare in 2017 and growing. Bottom line, If you can't afford to live in Rural areas without living off state welfare programs, then they should move. Again, its their choice to live in such areas, they need to pay for there choices. This reform alone would save Alaskan 100 of millions of the state budget a year" Politadick

So now, below is your update on the eight items the governor put on the call and where we are with each one.... (And just a quick reminder before the overview: unlike during the regular session, we can only deal with bills for which the session was called - so we're limited to these eight items.)

1. HB 57 Operating Budget – Conference Committee
The budget conference committee held a short organizational meeting, but the chair, Rep. Paul Seaton, has not reconvened the committee to reconcile the differences between the House and Senate versions of the budget. Due to inaction, on June 1, the governor had to issue pink slips to state employees. We can however avoid layoffs and a government shutdown if the budget passes prior to July 1. Members of the committee are Rep. Seaton (Chair - lead), Rep. Foster, Rep. Pruitt, Sen. Hoffman (Chair), Sen. MacKinnon, and Sen. Olson.

2. HB 59 Mental Health Budget – Conference Committee
The bill is part of the operating budget and is also in conference committee. It is typical for this bill to be reconciled and move forward alongside the operating budget bill. Members of the committee are Rep. Seaton (Chair - lead), Rep. Foster, Rep. Pruitt, Sen. Hoffman (Chair), Sen. MacKinnon, and Sen. Olson.

3. SB 26 Permanent Fund Restructuring – Conference Committee
The conference committee members for SB 26 has been selected by both the House and Senate, but they have yet to meet. Members are Sen. MacKinnon (Chair - lead), Sen. Egan, Rep. Foster (Chair), Rep. Seaton, and Rep. Thompson.

4. HB 111 Oil Tax Credits – Conference Committee
The House and Senate agreed to end the use of refundable (cash) credits for oil and gas companies, but the House insists on increasing how much companies pay in taxes. The Senate did not agree with this portion and so this bill will be going to a conference committee. Members are Rep. Tarr (Chair - lead), Rep. Josephson, and Rep. Talerico, Sen. Giessel, Sen. Stedman, and Sen. Olson. As of the date of this writing, no conference committee has been scheduled, but House Finance did postpone a Friday, June 2 hearing on HB111. Because the House Finance is not in possession of the bill, this is an odd scheduling.

5. SB 23 Capital Budget – In House Finance Committee
On May 12, the Senate passed the Capital Budget and the bill is in the House Finance Committee who had hearings two weeks ago but has not held any hearings since. The Senate created a budget that is much leaner than in the past, but there is concern that the House will add more projects and increase the budget. If this occurs, this bill could too end up in a conference committee.

6. HB 60 and SB 25 Motor Fuel Tax – In House and Senate Finance Committees
Both versions are in their respective Finance Committees. There have not been any hearings scheduled, but it's possible one of the bills could be moved out of committee and onto the floor for a vote.

7. HB 159 and SB 79 Opioid Prescriptions – Passed Legislature
HB 159 passed the House two weeks ago and last Thursday was passed by the Senate. Because the Senate made some changes the bill will have to go back to the House who will then concur with the changes or reject them.

8. Broad Based Tax – Bill yet to be Filed
The Governor has included in the session call “An act or acts to increase an existing tax or to establish a new broad-based tax for the purpose of generating new revenues for the State.” No bill has been proposed since the special session began that fits this description but it's possible the governor will introduce another income tax bill or a sales tax bill.

PLEASE NOTE: We are still under the "24 Hour Rule" which allows committee meetings to be scheduled just a day in advance. As things progress each week, I will update this list, but to receive the most up-to-date information you can sign up for text alerts (see below) or can click on the links for each bill within this newsletter.