First Session of 30th Alaska State Legislature

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Alaska State Legislature, House District 31

From the Desk of Representative Seaton:
June 12, 2017  Vol. 230

Greetings from Juneau on this 26th day of the first special session of the 30th Legislature.  I continue to work for a sustainable fiscal solution to our state’s declining revenue, but have had little success dealing with the Senate.  We are quickly approaching the end of the first special session and if we have not passed a budget within the allowable time, the Governor may call us back into a second special session.  The problem is well stated in John Havelock’s ADN letter quoted here:
“Alaska's present fiscal crisis results from the rarely directly expressed but deeply held antipathy of Senate President Pete Kelly and a small group of his colleagues for the idea of the Permanent Fund dividend.  Under Sen. Kelly's interpretation of core conservatism, the very idea of the so called "dividend," is anathema.  The PFD is a "handout," a "giveaway" of "unearned" money, going to the undeserving.
Make no mistake: The politics of the fiscal crisis is all about a state income tax versus PFD cuts.  It's that simple.”
Today on the floor we anticipate completing approval of one item of the Special Session:  HB159 Opioid; Prescription Database.  I also anticipate we will hear amendments to SB23 Capital Budget.

The Operating Budget Conference Committee which I chair, met four times last week and finalized decisions for seven departments plus the Court System.  The House Finance Committee met on Saturday morning to adopt a new working draft Committee Substitute (CS) of SB23 Capital Budget.  The CS restores some of the cuts that were made by the Senate, and importantly, removes $248 million of the money the Senate was going to spend on Oil and Gas Tax Credits that the House Majority did not support.  (Read more under the Budget section below).
Last week, the Governor and all departments sent out press releases outlining the impacts across Alaska that a government shutdown would have if a budget is not passed before the start of the fiscal year on July 1stClick here to read the press releases from various departments.  The House Majority Coalition has put forth our complete and fair fiscal plan and are committed to discussions, negotiations and compromise to reach this goal.  Based on the diverse experiences of other state shutdowns, we really don’t know what the effect of a shutdown would be here in Alaska.  The constitutional requirement that money can only be spent if appropriated by the legislature is in conflict with the constitutional requirement that the Governor provide for life, health and safety services in Alaska.  So the Governor would be maintaining a large number of the essential services even after July 1st without a budget. 
Governor’s Fiscal Plan Compromise Package
Last Monday, the Governor provided his version of a Fiscal Plan Compromise Package.  See chart below.
Bill Title Version
HB111 Oil and Gas Tax Credit Reform Senate plus 100% ring fencing
SB12 Education Head Tax Senator Bishop structure: target $100 million
HB60/SB25 Motor Fuels Tax Either version
SB26 Permanent Fund Protection Act Senate version
HB57/59 Operating / Mental Health Trust Budget House version
SB23 Capital Budget Governor’s priorities plus Senate deferred maintenance and oil and gas tax credit payment
The overall compromise falls short of generating sufficient revenue and leaves a significant deficit.  It would require a continued drain of our savings with further cuts to vital services like education, public safety, health, and transportation.  Our goal continues to be to have a fully funded budget with greater stability in our revenues that can move our state out of recession.  To be fair and balanced, our plan spreads the impact across all Alaskans in a graduated form so it’s not done all at once (PFD reductions starting this year, broad-based tax starting in 2019, motor fuels tax increase spread over several years, etc.).
The governor included SB12 Employment Tax for Education Facilities in his compromise package.  We are willing to consider this bill if the Senate will pass it over to us.  The current version of SB12 is rather regressive asking lower income people and children to contribute a larger percentage of their income than higher income people.  The governor’s proposed version for this bill only raises $100 million in new revenue (the current bill only raises $60 million).  I believe this bill would need to be improved in several ways so that it would be fair to Alaskans.  The House Finance Committee will meet at 1:30 today for a hearing on the topics covered in this bill and its revenue impacts.  The hearing will include alternate improvements as well.  You can read about different options and their impacts in this report.  Versions D (payroll tax) and E (payroll & investment tax) are two possible options, with version E being fairer to Alaskans and still requiring nonresidents to contribute.  
For the other bills in the governor’s compromise package:
  • HB111 Oil & Gas Tax Credits: see the House Finance section below.  
  • HB60/SB25 Motor Fuels Tax:  the House is still willing to consider the bill if the Senate could pass one.  
  • SB26 Permanent Fund Protection Act:  for more information on the differences between the Senate and House versions click here.
  • HB57/59 & SB23 budget:  see the Budget section below.
 The bottom line: How long do you want to kick the can down the road?  For three years in a row now the House and Senate have had to extend our sessions as we negotiated what vital services to cut, how deep to cut and how much savings to use.  The Senate Majority’s plan and the governor’s compromise are only partial solutions to ending this cycle.  Their plans leave a large deficit which forces us back into this same scenario next year, making more cuts to programs that help children, seniors and low-income Alaskans while subsidizing the oil industry.  Their plans rely on a hope that oil prices will rise again in the near future.  Would you balance your personal budget on the hopes you just might get a raise in the near future?  Or would you base your budget on income you know is coming, income that is more reliable and stable?  The House Majority Coalition wants to diversify our state revenue so it is more reliable and stable compared to the volatility of oil.  We believe Alaskans deserve a fully funded budget that supports vital services this year and years into the future and resolves our deficit sooner rather than later.
Thank you for taking time to contact my office and other legislators and for engaging in the process.  Here are some other resources that might interest you:
Kansas Republicans join with Democrats to end five year recession. The problems we are working to avoid in Alaska are the same problems that were created in Kansas.
SOS: Save our State: Realism and Compromise are keys to Alaska’s fiscal fix. By Gunnar Knapp, former director of UAA’s Institute of Social and Economic Research.
Real budget battle pits dividend versus taxes.  By John Havelock, attorney general to Gov. Bill Egan and a member of Gov. Jay Hammond's Growth Policy Council before his service as founder of the University of Alaska justice programs.
Oil Market Analyst warns of “false prophet” predicting higher prices
Analysis of Alaska’s Per-Capita Spending:  People often say Alaska’s per-capita spending is evidence of “bloated” government.  U.S. per-capita average is $4,804.  Alaska’s per-capita is $5,155 after special considerations unique to Alaska are subtracted (PFDs, oil & gas tax credits, higher health insurance, fisheries, resource management, etc.  See page 10 in the report for the full list.) 
Congratulations to the Homer High School Mariner girl’s track and field for winning the 1, 2, and 3A state championships last week.  Read more in the article here and here.  Photo provided by Betsy Wolf.
Together a Broad-Based Tax, House CS-SB26 Permanent Fund Protection Plan, and HB111 Oil & Gas Production Taxes & Credits, along with sensible budget cuts, make up the Alaska House Majority Coalition’s complete, comprehensive and sustainable fiscal plan.  Your testimony, phone calls and emails are helping to shape the Coalition’s four-pillar plan which fully funds and balances our state budgets within 3 years. Contact the Senate Majority members:
District 31 email: For other districts click here
  • Broad-Based Tax:  Email your Senator and get their commitment to include a broad-based tax as part of the fiscal solution this year.
  • House CS-SB26 Permanent Fund Protection Plan:  Email your Senator and request their support for an equitable plan which balances out the PFD regressive reductions with a progressive broad-based tax.
  • HB111:  Email your Senator and ask them to restore the bill to the House version. 
More resources are on my website or call my office if you have more questions.
For more resources on the budget and economy click here.
House Finance meeting last week on topics contained in HB111 Oil & Gas Tax Production & Credits. Click here for the presentation.
House Finance

Last Wednesday, the House Finance committee held a meeting on the topics contained in HB111 Oil & Gas Production Tax and Credits and the fiscal differences between the House and Senate bills.  The meeting served as a good refresher on the extensive differences between the two versions of the bill and how those differences will impact the state budget.  You can view the presentation here or watch the video here.  For more on my thoughts about these differences click here
The House appointed their conference committee members for HB111 on May 22, and the Senate appointed their members on June 1.  The committee met for the first time last Friday.  We hope they are able to construct a compromise that is beneficial to the state.
As noted earlier, this past weekend the committee also introduced and passed a new CS for the capital budget (see the Budget section for more information).  Today the committee will hear topics covered in SB12 Employment Tax for Education Facilities which is included in the governor’s compromise package. 
The Operating Budget conference committee met four times last week and finalized decisions on seven departments plus the Court System.  You can watch committee meetings on BASIS.
Operating & Capital Budgets

Operating Budget
The HB 57/59 operating budget conference committee met four times last week and I expect that more progress will be made this week.  The committee finalized the budgets for the Departments of Administration; Commerce, Community, and Economic Development; Corrections; Law; Military and Veterans Affairs; Public Safety; Revenue; Judiciary; Labor Agreements, Executive Branch-wide Appropriations, and Mental Health capital projects.  In addition, some items were decided upon in Health and Social Services, Natural Resources, University of Alaska, and Language items. 
The committee was able to close out all the items related to HB 59 (Mental Health Operating and Capital Budget).  As a result, HB 59 was transmitted to both bodies and likely will be up for a floor vote today.  With a conference committee bill, floor amendments are not allowed, so there is just a vote on the bill and on the effective date.  I am confident that the bill will pass and be transmitted to the Governor.
A conference committee is scheduled for today.  I anticipate additional meetings being schedule later this week.  The conference committee’s actions on the operating budget motion sheets are available on the Legislative Finance Division website.  You can check the committee’s schedule on BASIS or sign up for bill tracking for HB57 and receive email updates.
Capital Budget
House Finance Committee introduced a new committee substitute (CS) for the capital budget bill, SB23, on Saturday.  This version saves $248 million the Senate was going to pay for oil and gas production tax credits, corrects some of the re-appropriations used by the Senate, and restores some of the Governor’s key priorities. The CS still includes the $244 million for replacement of the state ferry Tustumena.  The Finance Committee took up amendments to SB23 on Sunday afternoon.  The bill is scheduled for the House Floor today and I anticipate it will pass the House on Tuesday.   
FY18 Budget & District 31
Click here for a summary list of items decided during the Operating Budget Conference Committee meetings last week.  Click here for the new summary of the House Capital Budget that passed from House Finance yesterday.  For comparison, here are the operating and capital budget summaries from several weeks ago: House Operating -- Senate Operating -- Senate Capital.  These summaries reflect some of the items in each budget that district constituents often contact my office about.  If you have additional questions, contact my staff Jenny. 
Click here to listen to my legislative report on KBBI last week.
Picture: (L to R) Rep. Pruitt, myself and Rep. Foster, House members of the operating budget conference committee.


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
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
Reminder:  The Homer LIO transitioned from a full time office to "open as needed".  Phone and email messages will be checked frequently.  The office will open for teleconferences that the community wants to participate in if they have at least one day's prior notice.  If questions, contact Amber at the Homer LIO:  235-7878  The Kenai LIO remains open full time, year round:  283-2030
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.
Pictures from the “Keep Alaska Open for Business” rally on the capitol steps yesterday.
Bits & Pieces

Tustumena Delayed until August 15
More rusted steel was discovered in the engine room of the M/V Tustumena and repairs will require additional time.  It is anticipated that the AK Marine Highway System will get approval for the Tustumena’s return to service departing Homer at 5 p.m., Monday, August 15.  For more information, please call your local terminal (Homer 907-235-8449) or the AMHS central reservations office at 1-907-465-3941 or toll free at 1-800-642-0066.  An updated schedule will be made available online at  Coastal Transportation, based in Seattle, continues to be an option for AMHS customers impacted by the Tustumena delay. Coastal Transportation can accommodate vehicles on an as-able basis, at the same cost as AMHS, transporting from Homer to Kodiak and to Aleutian destinations. Coastal Transportation can be reached at 1-800-544-2580 or 1-206-282-9979.
Public meetings scheduled on Kasilof River area projects – June 14 Soldotna
Department of Natural Resources has scheduled public meetings to discuss facility improvement projects along the Kasilof River.  Soldotna:  6:30 to 8:30 pm, June 14 in the Community Room of the Joyce K. Carver Memorial Public Library.  Anchorage: 6:30 to 8:30 pm, June 15, Room 102 of the Atwood Building. Topics will include: Kasilof River North Side Improvement Project, Kasilof River South Side Improvement Project, and Old Kasilof Landing Site Development Project.  For information or 269-8116    For information on the Old Kasilof Landing project, go to
Nominations open for 2017 Farm Family of the Year  
Dept. of Natural Resources is seeking nominations for the 2017 Farm Family of the Year.  Nominations are due by June 30th and can be submitted to: Johanna Herron,   or   Fax: (907) 745-7112
Alaska Trails – Mobile Tools available for use
Alaska Trails has mobile tool caches available to loan to organized trail groups on the Kenai Peninsula.  Contact: 907-334-8049

Thanks to members of Homer Council on the Arts for your colorful postcards supporting arts and arts education. They brighten up the office!

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
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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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