First Session of 30th Alaska State Legislature

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Alaska State Legislature, House District 31
From the Desk of Representative Seaton:

February 27, 2017 Vol. 215

Greetings from Juneau this 42nd day of session.  It is going to be a busy week in House Finance.  We started hearing subcommittee reports and amendments last week and will continue today and tomorrow.  After all the amendments are voted on, a new draft of the bill will be created and the week will close out with three full days of public testimony.  District 31 public testimony is on March 2.
In past years, the budget subcommittees have started their work from a budget based on the previous year’s management plan or implemented budget.  They then adopted some or all of the governor’s changes and the subcommittee budgets were automatically rolled into one new budget bill before the full finance committee considered it.  But for the past several years, the governor’s proposed budget has been smaller than the previous year’s.  This year the subcommittees began their work with the governor’s proposed budget and added or subtracted items from it.  Each of those subcommittee changes to the budget are now being voted on by the full finance committee before being included in the new budget draft.  The public can follow along as the committee votes, and hopefully have a better understanding of the changes within the budget when people call in to testify.
If you are looking for a way to brush-up your budget knowledge prior to public testimony at the end of this week, the Office of Management and Budget has several helpful summaries including this colorful chart and a glossary of budget terms.  The legislative finance division also has many useful publications, including the Swiss army knife budget guide which is an essential tool for legislative offices.
I truly appreciated all of the public testimony we received on the State Revenue Restructuring Act two weeks ago.  Between those that called in and the written testimony the committee received on HB 115, more than half supported a comprehensive fiscal plan and many had good suggestions on how the bill could be improved.  We are currently looking to see which recommendations we can incorporate into the bill.  Some potential changes were already put forward on Friday, which were inspired by presentations to the committee about the importance of permanent fund safeguards.  These changes relate to how the bill draws money from the permanent fund earnings reserve.  
I believe that a comprehensive fiscal plan must include multiple new revenue sources.  Diversity in revenue sources will help to stabilize our budget year to year because we won’t be as vulnerable to volatility from any one particular source.  Diversified revenue sources will also mean more Alaskans will have an active voice in how the state is governed, because they will be more directly connected to our budget.
Last week I enjoyed visiting with several Kenai Peninsula constituents.  From the Kenai Peninsula Borough, Major Mike Navarre and his assistant Larry Persily updated me on projects in the KPB along with assembly members Willie Dunn and Kelly Cooper and KPB staff Michelle Turner.  From the City of Homer, city manager Katie Koester, Mayor Bryan Zak, and council members Donna Aderhold and Heath Smith updated me on the city projects and priorities.  Ronnie Leach from Haven House in Homer was in town for the Alaska Network for Domestic Violence conference.  Brent Johnson from Clam Gulch updated me on the Cook Inlet Aquaculture Association.  Kristen McDonald from Homer was here representing the American Cancer Society.  Homer Harbor Master Brian Hawkins and Alaska Association of Harbormasters and Port Administrators secretary Rachel Lord stopped by to update me on harbor projects and priorities.  And Friday wrapped up with Matt Alward who was in town again for the United Fisherman of Alaska conference and Jon Faulkner who was in town for the Alaska Republican Party.

Weekly Survey
Please take a few minutes and answer two short questions in my weekly survey.  For the results from last week’s survey click here.  The weekly survey link and results will also be available on my webpage .

City of Homer reps were in town for the Alaska Municipal League conference (left to right): Heath Smith (City Council member), Katie Koester (City Manager), Mayor Bryan Zak, Donna Aderhold (City Council member).


I also met with Kenai Peninsula Borough reps:  (left to right) Kelly Cooper (Borough Assembly), Michele Turner (KPB Deputy Clerk), Willie Dunn (Borough Assembly), Mayor Mike Navarre, and Larry Persily (Assistant to the Mayor).


House Finance Committee

Mon. - Fri. 1:30-3:30pm

On Tuesday the committee reviewed the fiscal notes on HB 115, The State Revenue Restructuring Act.  According to the Department of Revenue, implementing the income tax section of the bill will require about 1% of the revenue the tax collects.  For the first year the tax will only be in place for half the fiscal year and will generate approximately $321 million.  Once fully implemented it will raise $643 to $650 million.  The Department of Revenue also estimates a draw of $1.5 billion from the earnings reserve for FY18
Brandon Spanos, the Deputy Director of the Tax Division, was able to clarify some of the questions committee members had on how the income tax would work.  For example, Mr. Spanos clarified that the capital gains tax in the bill would not apply to most 401Ks and pension plans, as those are mainly taxed as regular income.
On Friday the co-chairs introduced proposed amendments to the percent of market value (POMV) draw from the permanent fund earnings.  The amendments have not yet been discussed by the committee, but are available to the public.  Besides some technical cleanups, there are two main components to the proposed amendments.  1) to add an annual inflation deposit into the corpus of the permanent fund equal to 0.25% of the fund’s market value, and 2) to increase the amount of the draw for the first few years, before returning it to the more conservative draw of 4.75%.  These amendments were generated based on testimony and presentations the committee heard the week before.  For more information on HB 115 amendments click here.
The House Finance Committee moved two bills out of committee last week. We also listened to a presentation by Callan Associates, Inc. regarding the permanent fund, as well as considering the subcommittee budget amendment proposals from five departments and the Office of the Governor.
HB 24 An Act classifying U-47700 as a schedule IA controlled substance, was passed out of committee. The bill would add methylbenamide (also known as U-47700 or Pink) to the list of controlled substances.  This would be the 82nd item added to this list.  There was lots of discussion about having future legislation addressing controlled substances in a global manner so that legislation would not be needed every time a new synthetic drug comes on the market.
HB 48 Extend the Board of Architects, Engineers and Surveyors, also passed out of committee.  The bill extends the sunset date for this board an additional 8 years.  There were no audit findings regarding this board and the bill received the support of Legislative Budget and Audit.
David Teal also gave a brief overview of the new electronic operating budget amendment system.  The system will streamline the process by preventing structural errors from occurring when amendments are entered.  The system is still being developed and will improve the quality of the amendment process.
Callahan Associates, Inc. presented an overview of how they estimate the projected earnings of the permanent fund.  Callan has maintained a financial model of the Alaska Permanent Fund Corporation for the past 15 years. As of 12/31/2016 the market value of the fund was $53 billion.  The real return expectation of the fund that has been employed as a target by the APFC is 5%.  According to Callan, a draw of 4.75% and up to 5.25% is not unreasonable.  These are the percentages included in HB 115 and SB 61 (Governor’s Bill).  There was good discussion among the members.
The House Finance Committee started closing out department subcommittee reports last week.  We were able to consider the subcommittees’ proposed budget amendments and recommended statutory change proposals for the Departments of Administration; Commerce, Community, & Economic Development; Military and Veterans Affairs; and Revenue, along with the Office of the Governor.
This week we will close out all of the remaining Departments: Corrections, Education and Early Development, Environmental Conservation, Fish and Game, Health and Social Services, Labor and Workforce Development, Law, Natural Resources, Public Safety, Transportation and Public Facilities, University of Alaska, Judiciary, and the Legislature.  These actions will result in a new committee substitute for the operating bill, hopefully by Wednesday of this week.
Public Testimony is scheduled to start Thursday and continue through Saturday on the full operating budget.  District 31 is scheduled for Thursday, March 2 from 1-3:30pm.  If you are unable to testify at that time, there is also the “overflow” testimony on Saturday, March 4 from 3-5pm or you can email your testimony at any time to  Instructions for how and where to testify are below, along with the geographical schedule for those calling in from outside of Juneau.  


House Finance schedule for the week
Note time changes and additional meetings
Monday, February 27, 2017 1:00-5:00 PM
Subcommittee Reports and Amendments
Tuesday, February 28, 2017 9:00 AM-12 PM and 1:30-7:00 PM
HB  59 - APPROP: MENTAL HEALTH BUDGET                   
Subcommittee reports and amendments proposals as available
Wednesday, March 1, 2017 1:30-3:30 PM
Committee Substitute
Thursday, March 2, 2017 1:00-6:00 PM    
Public Testimony:
1:00 – 3:30 p.m.* Homer, Kenai, Ketchikan, Kodiak, Mat-Su & Seward
3:45 – 6:00 p.m.* Barrow, Dillingham & Fairbanks
**In the case of postponement, Thursday’s public testimony will be rescheduled as follows:
Saturday, March 4, 2017 – 3:00 – 5:00 PM – Homer, Kenai, Ketchikan, Kodiak, Mat-Su & Seward
Monday, March 6, 2017 – 1:30 – 3:45 PM – Barrow, Dillingham & Fairbanks
Friday, March 3, 2017 1:00-6:00 PM           
Public Testimony:
1:00 – 3:00 p.m.* Anchorage
3:15 – 4:45 p.m.* Sitka, Petersburg, Delta Junction, Unalaska, Glennallen & Tok
5:00 – 6:00 p.m.* Off Net sites
Saturday, March 4, 2017  9:00 AM - 5:00 PM
Public Testimony:
9:00 – 10:00 a.m.* Bethel, Cordova, Kotzebue, Nome, Valdez, Wrangell
10:00 - 11:00 a.m. * Off Net sites
1:00 – 3:00 p.m. Juneau
3:00 – 5:00 p.m. Overflow Public Testimony as needed
Public Testimony Instructions
If you would like to provide public testimony, keep in mind the following:
Testify in person or on the phone: Limited to 2 minutes each.  Arrive (or call in) early to expedite the sign in process, and be sure to arrive at least 15 minutes prior to the end of the allotted time period or testimony may close early.  If you are a member of a group with the same message, in the interest of time, please select a spokesperson to testify for the entire group.  If you are calling from a community without a legislative information office, i.e., an “Off Net” caller, only call during the designated Off Net time period on March 3rd and 4th; please call 465-4648 by 5:00 p.m. on Wednesday through Saturday to obtain the call-in phone number.  All Off Net callers are required to hang up immediately after your testimony is taken to keep as many lines open as possible for other callers.  Testifiers can continue to listen or watch the meeting online at, click on Alaska State Legislature and then choose the “Live Now” button.  The hearing may also be televised on Gavel to Gavel, please check listings.
Email Testimony:  If you live in a community with a legislative information office, but are unable to access it during the specified time period, you may send your written testimony to the House Finance Committee via through 5:00 p.m. Saturday, March 4, 2017.


It was great meeting up with Jon Faulkner to discuss District 31 Republican priorities.

Budget Subcommittees
I am chair of the subcommittees for the Department of Revenue, Office of the Governor and the Legislature.  All of the subcommittee meetings are listed on BASIS and streamed on

On Monday the Department of Revenue budget subcommittee officially closed out its discussions on the budget.  Two amendments to the budget were forwarded to the full finance committee for consideration and action.  One would add two corporate tax auditors, which is predicted to generate new revenue of $500,000 each.  The second amendment restores funding to the Mental Health Trust for a Fetal Alcohol Spectrum Disorder (FASD) prevention campaign; one child with FASD can cost the state $850,000 to $4.2 million, which more than offsets the cost of the prevention campaign. 
These amendments, combined with changes to the Department of Revenue the governor has proposed, results in a total reduction of $455.2 thousand in unrestricted general funds over last year’s budget.
The subcommittee also forwarded eleven recommendations for statutory changes that could result in budgetary savings.  Those will be sent to the appropriate policy committee for review and possible introduction as legislation.  The full finance committee considered and adopted the amendments for Department of Revenue on Thursday. 
Office of the Governor

The subcommittee’s budget recommendations for the Office of the Governor was forwarded to and heard by the full House Finance Committee last week. The Office of the Governor’s budget was passed with no changes.

Last week the subcommittee for the Legislature’s budget was closed out. Thirteen proposed budget amendments were considered and 12 were forwarded to House Finance.  Ultimately two statutory change proposals were forwarded to House Finance.  The subcommittee’s recommendations would reduce just over $2 million from the proposed FY18 budget for the Legislature. The full Finance Committee will take up the Legislature Subcommittee recommendations this week.


FY18 Budget & District 31 
As noted above, the remaining finance subcommittees will be closed out and through House Finance on Monday and Tuesday.  By Wednesday, Legislative Finance will have updated reports on all the House subcommittee amendments to the Governor’s budget.  My staff Jenny will be looking through the reports to determine any significant changes to services that affect our district.  If you would like to review the amendments to a particular department prior to your public testimony, click here or contact Amber in the Homer LIO, Mary in the Kenai LIO or Jenny in my office to assist you.  Your public testimony is important for helping myself and other House Finance members know what additional amendments to propose next week when we take up our second round of amendments.  I appreciate you taking the time to write or call with your specific suggestions and concerns.

Bryan Hawkins, Homer Harbor Master, and Rachel Lord, Ex. Secretary for the Alaska Association of Harbormasters, updated me on harbor priorities in our coastal communities.

Legislative Budget & Audit Committee

Meets as needed throughout the year.

Last week the committee approved two contractual items as requested by the Legislative Auditor.  One was to award a contract for conducting the statewide single audit in the amount not to exceed $120,000.  This audit summarizes the State of Alaska's basic financial statements and the State's compliance with federal laws and regulations related to federal financial assistance.  It includes summaries of recommendations on financial and compliance matters, auditor's reports on internal controls and compliance, the Schedule of Expenditures of Federal Awards, and the Summary of Prior Audit Findings.  The second was to extend the contract for audit services related to the Comprehensive Annual Financial Report (CAFR) audit, an amount not to exceed $50,000.  The CAFR is coordinated at the end of a fiscal year with the results usually available by the following December.  Click here for more information on audits conducted by the Legislative Audit division.
The committee also reviewed the results of the Legislature’s audit, conducted by an outside auditor (not working for the legislature).  This audit looked at the procedures used by the Legislature, including the Legislative Affairs Agency, for appropriations, expenditures, encumbrances, and revenue.  The auditor found that all information was presented fairly and was in accordance with generally accepted accounting principles.  The committee approved advancing the start date of the Alaska Mental Health audit closer to May of this year.  The committee chair reviewed the oil and gas consultant contracts discussed at the previous meeting.  The chair noted that the contract with Hart Energy was not extended due to a recent conflict of interest.  The chair therefore approved a contract with Rich Ruggiero of Castle Gap Advisors in the amount of $35,000 as needed through June 30, 2017.  These consultants are available to all legislators to utilize on a committee priority basis while reviewing oil and gas legislation such as HB111.

Other Committees

For more information on what is happening in other committees, please go to the Committee Chair’s newsletters which are linked here and also  located on the  Alaska House Majority Coalition webpage:


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.


Public Testimony Opportunities
In addition to those already noted above.
Contact the Homer or Kenai LIOs noted below for more information.

Monday: 02/27
1:30pm Senate Health and Social Services
SCR 2: Sexual Assault Awareness Month
3:15pm House Labor & Commerce
HB121: Occupational Health and Safety Civil Penalties
HB114: Boiler/Pressure Vessel Inspection Reports
Tuesday: 02/28
8am Community & Regional Affairs
HB47: Municipal PERS Contribution/Interest
10am House Fisheries
HB107: Fish Enhancement Permits
HJR12: Genetically Engineered Salmon
1:30pm Senate Labor & Commerce
SB40: Omnibus Worker’s Compensation
SB29: Repeal Worker’s Comp Appeals Commission
3pm House State Affairs
HB1: Election Registration & Voting
3:30pm Senate State Affairs
SB46: Oct 25: African- American Soldiers AK Hwy. Day
Wednesday: 03/01
8am House Education
HB102:  Limited Teacher Certificates
HB86: Student Loan Default/Occupational License Renewal
1:30pm Senate Health & Social Services
SB63: Regulation of Smoking
3:15pm House Labor & Commerce
HB90: Occupational Licensing Fees
HB79: Omnibus Worker’s Compensation
3:30pm  Senate Resources
SB60: Fish & Game Offenses / Licenses / Fees
6pm  House Resources
HB111: Oil & Gas Production Tax
Thursday: 03/02
8am House Community & Regional Affairs
HB4: Military Facility Zones
HJR10: Limited Declaration of National Monuments
1:30pm Senate Labor & Commerce
SB51: Extend Board of Veterinary Examiners
3:30pm House State Affairs
SB48: Insurance for Dependents of Deceased Fire/Police Officers
Friday: 03/03
1:30pm  Senate Judiciary
SB54: Crime & Sentencing- LISTEN ONLY
Saturday: 03/04
See House Finance – Operating Budget above for schedule.  Note Homer’s LIO will be open at 2:30p if any participants did not get to testify on the operating budget at Thursday’s House Finance meeting.
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

Left picture: Kristen McDonald (left) and Nikiski members from the American Cancer Society provided their list of priorities for the session. Right picture: Ronnie Leach (left), Haven House, pictured with my staff Jenny, was here for the Alaska Network for Domestic Violence conference.
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
Celebration of lifelong Learning
Friends of the Homer Public Library are looking to honor a community member who has made a lifelong commitment to acquiring an exceptional skill or knowledge. For more information please call 907-435-3195 or e-mail
State Annual Land Auction
The Department of Natural Resources, Division of Mining, Land, and Water, Land Sales Section’s Annual Land Auction will begin next month. For more information please contact Kathryn Young, Land Sales Section Manager, at or 269-8672.
Public Testimony to Alaska Board of Fisheries
Alaska Board of Fisheries to Meet in Anchorage, March 20–24, 2017 on Statewide (except Southeast and Yakutat) King and Tanner Crab and Supplemental Issues. Written comments submitted after February 27th for public testimony are limited to 10 single-sided or five double-sided pages in length from any one individual or group.

I had the great honor to introduce my daughter Tawny, granddaughter Hazel and my wife Tina on the House Floor last week.


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
Joan Brown
Operating Budget, Finance Subcommittees
Arnold Liebelt
Operating Budget, Finance Subcommittees

Tom Spitzfaden

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Rep. Seaton's Session Contact Information:

Mailing Address:
State Capitol - 120 4th Street,
Juneau, Alaska 99801
Phone: (907) 465-2689
Toll-free: 1-800-665-2689
Fax: (907) 465-3472

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Dec 22 Transition Newsletter

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