4th Special Session of 30th Alaska State Legislature

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Alaska State Legislature, House District 31

From the Desk of Representative Seaton:

November 13, 2017 Vol. 239

Greetings from Juneau on this the 21st day of the 4th special session. Winter has arrived in Juneau with the first snow fall of the week occurring last Friday. I hope you at home had a nice Veterans Day.
On Friday, the Senate adjourned Sine Die from the 4th special session after only one hearing on the governor’s payroll tax bill, leaving the state in what is projected to be a worse fiscal position than we ended last session.  I am disappointed at their unwillingness to work toward a sustainable future for the state.  The House Majority was ready to work on revenue if the Senate came to the table, and the House Finance committee had discussed some potential changes to improve the governor’s bill. 
The Senate adjournment last Friday took place after the House had already adjourned to 11am Monday (today). The House had adjourned to Monday because we anticipated Senate action on the crime bill and the revenue bill over the weekend.   Because of the seriousness of the work before us, the House has decided to not adjourn Sine Die today which will force the Senate back into session starting Tuesday.  Legislative rules require that neither legislative body can be out of session for over three days unless both bodies adjourn Sine Die.  If the Senate has not already sent SB 54 to the governor for signature, they could still choose to reconsider their decision to concur with the House, which would put the bill into conference where we could quickly address the legal concerns.  Technical floor sessions can occur with as little as two members in attendance.  The local House Juneau delegation will preside over the House technical sessions in the coming days. This will allow the House to realize significant savings on travel, per diem, and other costs.   If the Senate decides to act, the entire House of Representatives will be called back into session.  You can read more in our House Majority press release here.
The Senate’s adjournment has potentially serious consequences for criminal justice reform as well.  Late last Monday the House passed SB 54, which adjusts some provisions in last year’s criminal justice reform bill.  There were several amendments passed on the floor.  Some made SB 54 a stronger bill, but some of the other amendments had unintentional legal consequences that if challenged would undo the stronger C felony sentences in the bill.  Effectively the most problematic amendment made the sentence for a first-time C felony offense the same length as a sentence for a first-time class B felony.  Since class B felonies are more serious crimes than C felonies, due process would require that their punishments be different.  When the amendment passed on the floor, the body as a whole did not have access to legal analysis highlighting this concern.  After it passed the floor, the Department of Law and several other legal experts made clear that we can expect that provision to be challenged.  If it’s challenged the likely result will be that the courts revert the sentences back to SB 91, which was 0-18 months of suspended jail time.
This and other concerns could have been addressed quickly through a conference committee on the bill.  Unfortunately, the Senate on Friday chose not to go into conference and instead passed the bill with all the House changes.  This leaves the C felony sentences vulnerable to court cases and repeal.   A court challenge could include a temporary injunction on SB54 in which case we would continue to operate under the weaker sentencing provisions of SB91 until it is revised by the court.  I supported the intent of criminal justice reform, which is to reduce recidivism and therefore reduce repeat crimes.  I also supported measured changes made through SB 54 to help give our law enforcement professionals the tools they need, but those changes need to be thoughtful and enforceable.  By going to conference we could have reviewed and addressed the errors that arose through the floor amendment process, but unfortunately the Senate was not interested in taking that time.

In case you missed it, here is the link to my KBBI interview last Friday. Note, my interview with KBBI was prior to the Senate voting to pass SB54 and Sine Die.
It was a beautiful day in Homer for the Veterans Day parade and honoring all
our past and present veterans for their service to our country.

Finance Committee

On the budget side of things, House Finance has been looking at the state’s overall fiscal picture, which includes both revenue and expenditures.  One of the biggest drivers of the budget is healthcare because the cost of healthcare is increasing faster than everything else.  You can watch last Thursday’s committee meeting to hear Legislative Finance Director Teal discuss this issue, and to see my presentation on how the state can start to bend that cost curve down which will result in future state savings.
This week the Finance Committee heard presentations from Pat Pitney, Director of the Office of Management and Budget (OMB); Ken Alper, Director, Tax Division, Department of Revenue; David Teal, Director of the Legislative Finance Division; as well as from myself as I wanted to provide the committee with information on how we can avoid or lower health care costs as we continue to work to contain spending.  All the presentation materials as well as audio recordings of the presentations can be found here.
On Tuesday, Pat Piney presented on the current budget gap and balances of our fund sources.  Much of this information was not new information, but nonetheless was important information to hear again.  Many people do not realize that 50% of all state expenditures are direct payments to communities and providers such as Medicaid payments, K-12 schools, retirement payments, school debt reimbursement, senior benefits, public assistance, foster care, oil and gas tax credits, and permanent fund dividends.  Through budget reductions and efficiencies, total state spending (general funds) is down $1.6 billion since FY15.
Unfortunately, the revenue situation has deteriorated slightly.  According to OMB, we are looking at a $2.7 billion deficit in FY19. If the Senate’s version of the permanent fund plan is adopted (SB26), we would still be $638 million in the red and have lower dividends. The unfortunate reality is that the refusal to adopt a balanced fiscal plan will deepen and extend the recession which Alaska is currently experiencing. Though the House and Senate are not very far apart on the permanent fund plan, it’s clear that both plans still leave a gap of over $600 million – depending on the price and production of oil.  How to fill this gap is the point of the disagreement.
The governor’s special session bill (HB 4001 – Wage and Self-employment tax) was estimated to raise $320 million.  The bill as is would not have filled the gap, but the gap would have been more manageable and additional options exist on how to fill the remainder.  Options include:

  • Amend HB4001 to include investment, retirement and S corporations;
  • Small draw on the reserve account
  • Pass motor fuels tax bill (HB60)
  • Contain growth of health care cost
In OMB’s presentation, Ms. Pitney made the point that unplanned draws significantly impact future draws from the Earning’s Reserve Account (ERA).  If an additional draw of $500 million is needed from the ERA to balance the budget, it will cost $153 million in annual revenue over the next 5 years.  The balance of our savings accounts, the CBR and SBR, at the end of FY18 is estimated to be $2.1 billion.  The CBR is used for cash flow purposes at the beginning of the fiscal year, to make payments until expected revenues are online.  Reducing the CBR below its current level becomes risky and is not advisable.  
On Wednesday, the committee held a second hearing on HB 4001, the governor’s wage and self-employment tax.  During the first hearing on the bill several members asked about how the local tax burden of Alaskans compares to other states; Alaskans don’t currently pay a broad-based statewide tax, but many pay local property or sales taxes.  From the department’s presentation we learned that Alaska still has the third lowest tax burden when state and local taxes are added together and Anchorage is the lowest taxed major city in the country. 
The bill presentation also reviewed technical details such as how HB 4001 would treat partnership and S corporation income and whether individuals could donate their dividend in lieu of paying the tax.  Currently partnership income would be taxed as self-employment income but S corporation income would not be taxed; this is due to how the federal government defines self-employment income, which for administrative reasons is the definition that the governor’s bill relies on.  S corporations also do not pay the Alaska state corporate income tax (note: when the corporate income tax exclusion was originally created for S corporations they were already paying taxes under the individual income tax the state had until 1980). 
Unfortunately, it was also determined that those Alaskans who would like the option to donate their PFD to the state would still need to pay federal taxes on it.  This is because as soon as someone is determined to be eligible (which you would need to do before you could donate) then the federal government would consider the PFD income as belonging to that individual, even if they chose not to receive it.
On Thursday, Legislative Finance Director David Teal presented on the current state of the overall fiscal and budgetary situation.  Since last session several of the key components have been updated including the revenue forecast, the production forecast, the budget 10-year plan, and the permanent fund projections.  [The budget 10-year plan is based on keeping this year’s services the same over the next year, so only growing the budget with inflation, and does not necessarily indicate the budget the governor will put forward].  Although the production forecast has increased slightly from last year there are other levers that have gone down, including the projected return from the permanent fund.  This means that overall our situation hasn’t changed much from last year (in fact, the deficit has grown slightly).  We still have deficits of $600-$900 million even after using a portion of the permanent fund earnings.
Director Teal’s presentation reminded members that in order to maintain the same levels of services we have now the budget has to grow with inflation.  To put it in other words, a budget that is held ‘flat’ to a numerical value is actually a budget with service cuts each year because operational costs increase with inflation.  One of the biggest drivers of inflation is the cost of healthcare; while most costs increase at 2.25%, healthcare costs have been increasing sometimes as much as 8% each year.  If we are going to have a sustainable budget without major service cuts we will need to start reducing the inflation rate.  One way of bending this curve is by decreasing the healthcare burden.  I presented on the role vitamin D can play in improving the health of Alaskans and the future savings that would result.
I would like to share some news with mixed feelings today.  My staff, Taneeka Hansen, will soon be leaving her position in my office to continue her education in Washington state. 
Taneeka was born and raised in Homer.  Soon after graduating college, she started in my office as a temporary 90 day staff.  In this position she assisted with legislation to improve the Pick Click Give program and Education reform. In 2015 she moved into a full-time position and was my committee aide on the Health and Socials Services committee. Taneeka spent many hours working on the Medicaid reform bill and continued to participate with the state and our local opioid task force.  During special session last year, Taneeka also became an expert on oil and gas production and tax credits.  This past year she switched hats from health care to finance spending long nights and weekends learning the finer points of state and federal taxes and probably more than she wanted to know about estates and trusts. 
Her diligence, tenacity, and persistence to fully understand an issue has not only benefited my office and constituents but those across the state as well.  It’s been an honor and privilege to have her as a staff in my office and I know she will excel in her future pursuits. 

Public Testimony Opportunities

Due to the 24 Hr. Rule being in effect, please contact the Homer or Kenai LIOs noted below for more information.

Public testimony (when scheduled) can be given in person at your LIO or call (907) 465-4648 prior to the meeting for a phone option.  Written Comments are best addressed to the chair of the committee where the bill is being heard.  If you are interested in a public testimony meeting that is not listed above please call the Kenai LIO 283-2030 or Homer LIO 235-7878.  For a full list of all upcoming meetings, please visit the Alaska State Legislature’s webpage at

Following Bills & Committees
Access bills and committee schedules through the Legislature’s BASIS home page.  Get automatic alerts when a bill is scheduled for hearing or public testimony by signing up for “Track Bills in BTMF”.  Most committee hearings are broadcast on Gavel-to-Gavel at www.360north or through the Live Now tab on the BASIS home page. 
NEW!  "Chat with Legislative Information Staff
Monday-Friday between 8:30am and 4pm you will find a new chat interface in the lower right corner of The LIO staff can help answer questions about finding things on the website, answer questions relating to tracking legislation and help you get in touch with your legislator. Let us know how we can help you!
Legislative Information Offices (LIO) – Our Homer and Kenai LIOs are a great resource for tracking bills and participating in hearings.
Homer: Amber Corey 235-7878, 270 West Pioneer Avenue
Kenai: Mary Bea Byrne 283-2030, 145 Main St Loop, Suite 217
POMs Email is the preferred method of communication for our office.  POMS is currently operational but may experience a delay in reaching our office.  If needed, contact your local LIO office who can email us your comments.

Bits & Pieces

Did you know insurance rates in Alaska have gone down 21% this year?
Open Enrollment for ACA health insurance is now through Dec. 15, 2017 to enroll in or change 2018 Marketplace health insurance.  Financial support and extra savings are also available to Alaskans who qualify.  Alaskans can call the Get Covered Alaska helpline at 1-844-PLANSAK or visit to learn more. Additional help is available here.
“Navigators” in our District 31 that can assist you:

  • South Peninsula Hospital (Homer) 907-235-8101
  • Peninsula Community Health Services (Soldotna) 907-260-5017
  • SVT Health Clinic (Homer) 907-226-2228
  • Kachemak Bay Family Planning Clinic (Homer) 907-235-3436

More info at:
Public comment: AK Marine Hwy 2018 Summer Ferry Schedule.
Click here to view proposed schedule.  Call in to share your comments at 1:30pm Nov 16 for Southwest and Southcentral schedules or 10am for Southeast schedules. Toll free number to participate in teleconferences: 1-515-604-9000, access code 279613.
State Board of Forestry Teleconference/Webinar
Wednesday, November 29, 2017- open to public. Meeting is 8:30 - 5:00 p.m. with public comment at 1:15 p.m. Topics include forestry funding and management, legislation and regulations, wood energy, forest sustainability verification, fish habitat sampling and permitting, and cooperative forestry programs. Click here for agenda.  To sign up for teleconference or webinar access contact:  907-269-8467 or
Career Information & Job Postings
The University of Alaska has launched Career Coach, a web-based tool to help Alaskans explore career and higher education opportunities. Browse current Alaska job postings, learn about workforce training and educational opportunities and access current Alaska labor market and wage data using simple online tools.
Troopers Wanted!
Department of Public Safety is recruiting nationally for men and women who are interested in a unique and challenging career with the Alaska State Troopers. Training Academy begins July 29, 2018. All applicants must successfully pass the written test (Law Enforcement Officer Exam) through and also apply on Workplace Alaska. For more information on the test, testing fees, upcoming testing dates, and to register to take the test, go to After you register for the written test, study materials will be provided to you electronically. Passing written test scores are valid for 15 months.  November test dates located in Fairbanks and Anchorage at the following locations and times:
--Nov. 14, 2017 Anchorage test: 9:00 A.M. at the Department of Public Safety, ABI Classroom, 5500 E Tudor Rd
--Nov. 17, 2017 Fairbanks test: 9:30 AM at the Alaska State Trooper Post, 1979 Peger Rd., Fairbanks, AK  
Applicants must register in advance at More dates will be added in the future. If unable to test at the above dates please visit

Contact Us

If you would like to speak to me regarding a specific issue, it is helpful to first get in touch with the member of my staff handling related issues. 

Homer: May-December
270 W. Pioneer Ave., Homer AK 99603
907-235-2921 or 1-800-665-2689; Fax: 907-235-4008

Juneau: January-April
State Capitol – 120 4th St., Juneau, AK 99801
New location: Room 505
907-465-2689 or 1-800-665-2689; fax: 907-465-3472

Kenai: 907-283-9170 (will transfer automatically to Homer or Juneau)

Rep. Paul Seaton

Jenny Martin
Constituent issues and questions, General Capital & Operating Budget information,CAPSIS requests, Personal Legislation

Taneeka Hansen
Legislation & Sustainable Fiscal Plans in House Finance, Personal Legislation
Elizabeth Diament
Legislation & Sustainable Fiscal Plans in House Finance, Personal Legislation

Arnold Liebelt
Operating Budget, Finance Subcommittees

Rep. Paul Seaton

Thanks for signing up for my newsletter and engaging in the public process. I try every week to keep you abreast of issues and bills discussed at the committee level, where YOU have an opportunity to participate.


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November 6, 2017 Newsletter
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