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We Build Alaska

House committee hearing highlights major rift between House and Senate on budget and dividend

A meeting of the House Ways and Means Committee this evening highlighted the growing tensions between the House and Senate over the budget and Permanent Fund Dividend. With just nine days to go before the constitutional session limit of 121 days, the operating budget passed by the House three weeks ago remains in the Senate Finance Committee.

Senate Bill 107, a Senate Finance Committee bill that changes the Permanent Fund Dividend formula to a 25/75 with triggers to get to a 50/50, was heard in the committee for the first time. The bill requires $1.3 billion in new revenue and a minimum balance of $3.5 billion in the Constitutional Budget Reserve to trigger a 50/50 dividend – which would be approximately $2,600 this year, while a 25/75 dividend would be approximately $1,300.

The bill passed the Senate last week by a 12-7 vote. No senators were present in the committee meeting this evening. Instead, Tim Grussendorf, a legislative staffer for Senator Lyman Hoffman (D – Bethel), presented the bill to the committee. Grussendorf was grilled by committee members about the bill. He was asked numerous policy questions – something legislators customarily answer. Staff typically present the content of bills, and not answer policy questions.

Grussendorf was asked about new revenues, what the size of the dividend should be, why the Senate choose the revenue and savings triggers they did, the size of the budget, the state of our economy, how the bill could be altered, and why the Senate sent this bill to the House.

All things considered, Grussendorf did a great job navigating major policy questions that have plagued the Legislature for years. He repeatedly told the committee they are free to do what the want to the bill, and the differences between whatever the House may pass can be worked out in a conference committee with the Senate.

Representative Kevin McCabe (R – Big Lake), noticeably frustrated by the budget situation, asked Grussendorf why the Senate has not sent the budget back to the House, and when they can expect to receive it. Representative Ben Carpenter (R – Nikiski), who chairs the committee, interjected and told Grussendorf he did not have to answer, joking that it’s above his pay grade.

Representative Jamie Allard (R – Eagle River) asked Grussendorf why no senators were presenting to the committee. Grussendorf gave a diplomatic answer, saying he often presents bills to committees. But it’s odd for a staffer to be solo at a committee answering questions on such a controversial policy bill. Grussendorf noted that the Senate Finance Committee itself was divided on the bill.

Former Senator Tom Begich, who served as Senate minority leader in the last Legislature, told the Landmine, “If the Senate is serious about solving this problem, there should have been a senator at the table. If everyone was acting a little more like adults, they could probably solve this problem.”

The bill is unlikely to get any traction in the House this session. Even if it moves from the Ways and Means Committee, it still has a finance committee referral.

As the clock winds down, the focus seems to be on convincing enough House members to concur with whatever budget the Senate sends back to them. Time for a conference committee is running out, and the major issue remains to be the amount of the dividend. If they cannot come to a budget deal by next week, a special session is imminent.

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9 months ago

Does anyone know why there were no senators present? I am with former State Senator Tom Begich on this one. Someone should have been there. As it was, the fact that there was not, was a slight to the House and was probably taken as one. Not very adult.

Marlin Savage
9 months ago
Reply to  Shelia

Ashamed to face anyone due to their history of wasteful spending and current, greedy efforts to appropriate and waste the PFD.