It’s day 68 of the 121-day session (the 90-day statutory session has been a joke for a while) and the budget is stalling in the House. They are not only facing issues with the FY2025 supplemental budget, but also the FY2026 operating budget. Both the House and Senate are struggling to figure out how to tackle the deficit due to spending pressures. In a hastily called board meeting, the Alaska Gasline Development Corporation (AGDC) voted to enter into an agreement with Glenfarne to try and construct a gasline. And the Anchorage municipal election concludes on Tuesday. 

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House Finance Committee tries to advance budget

The following is an excerpt from this week’s edition of the Alaska Political Report. You can click here for more information about the Political Report. A subscription is $1,299/year per organization. Discounted pricing is available for non-profits and government entities. Our coverage of the budget starts with the governor’s proposed budget, and we track everything in detail through the entire process. If you have any questions or would like to subscribe, please email jeff@akpoliticalreport.com.

The House Finance Committee is actively working through the process of amending the operating budget. On Wednesday, the committee worked until after 9 pm and covered roughly half of the 96 amendments proposed.

A few notable items were passed including a near $80 million unallocated cut to state agency operating budgets. The sponsor of the amendment, Anchorage independent Rep. Calvin Schrage, one of the three co-chairs, did not provide specifics on how the cut would be absorbed by agencies, instead leaving those decisions up to GOP Gov. Mike Dunleavy.

The amount is based on the sum total of additions Dunleavy proposed to the FY26 budget. Directly rejecting those additions would have required Rep. Schrage to publicly support short-funding the state’s Medicaid program, cutting the Alaska Psychiatric Institute, and underfunding prison operations. Instead, his unallocated cut would effectively force Dunleavy to take those actions but provide the Legislature a thin layer of deniability.

The majority members aren’t alone in taking pot-shots at the Governor’s operations. Fairbanks Republican Rep. Will Stapp, a member of the minority, has brought forward several amendments to cut vacant state positions, some of which have passed. When recruitment fails, departments’ often use the savings from the unfilled position to fund overtime for existing staff, contractors to perform the duties, or other unfunded needs. Stapp justified his amendments by indicating agencies should be notifying the Legislature of these funding shifts during the legislative process. The effect of his amendments are smaller in size than Schrage’s, and more targeted, but still have unknown consequences for state agencies.

It is hard to predict how long the committee will take to vet the remaining 50 or so amendments. None were not taken up today (3/27/2025).

Tooksok Bay Democratic Rep. Nellie Jimmie, a member of the majority, left Juneau today to attend a festival in Bethel, leaving the majority without enough votes in the room to pass amendments. She can vote on amendments if she attends via phone but must be physically present to vote on the final bill.

The House finance amendment process almost always involves long nights with brief breaks and, for majority members at least, mandatory attendance. Forcing the committee to work around one member’s travel schedule is uncommon outside of family emergencies.

The Political Report will have a comprehensive review of amendments once the process has completed.

Neil Steininger, Budget Correspondent

Note: The House did not take up any budget amendments on Friday (3/28/2025) and a Saturday meeting they had scheduled was cancelled. 

No endgame in sight

More than halfway into session, there is no clear plan to get out of Juneau by day 121, which is May 21. The amount of the Permanent Fund Dividend (PFD) and spending pressures – like increasing education funding – mean there will almost certainly be a deficit for FY2026.

During a Senate majority press conference this week, Senator Cathy Giessel (R – Anchorage) offered some ideas to deal with the budget deficit. One, she said the PFD could be reduced from $1,400 (the 25/75 amount the Senate majority has said they support) down to $1,000. Two, she said revenue bills in the Senate – like a bill that would apply Alaska corporate income tax to Hilcorp (which is an S corp) and an internet sales tax bill – could help to fill the deficit.

But even at a reduced PFD of $1,000 and a $680 increase to the Base Student Allocation (the House passed $1,000 but that number is sure to be lowered), the deficit would still be around $250 million. And there does not seem to be the will to cut and/or raise that much revenue. 

Meanwhile, the House Finance Committee has left in a full PFD because they House majority lacks the votes to reduce it or remove it to be deal with later. And in a bizarre move, the majority pulled out the language that would have allowed them to draw from the Constitutional Budget Reserve (CBR) – which requires a 3/4 vote, or 30 in the House. The House majority only has 21 members, meaning even if they decide to use the CBR, they would need nine votes from the 19-member Republican minority. 

Things got very intense this week in the committee over that issue. 

There is an agreement between the House and Senate to exchange operating and capital budgets on April 11. But unless the House Finance Committee picks up the pace, that may end up being a hard deadline to meet. Governor Mike Dunleavy (R – Alaska) has been totally checked out, so there is no telling what he will end up doing with the budget. There has already been talk of a special session due to these hard to solve budget problems.

Other Happenings

In a meeting that was only noticed 24 hours before, AGDC voted 6-1 to enter into an agreement with Glenfarne to try and build the gasline. The bulk of the meeting was done in executive session. They voted when they came back. The no vote was board member Doug Tansy, the Business Manager for the IBEW Local 1547. His no vote is interesting as this is a project labor really wants. I will have more to say about this soon, but while the decision and the Trump impact on this project are exciting, there are a lot of reasons to still be apprehensive. 

Labor boss Joey Merrick sure does have opinions about it! 

Sometimes legislators take really dumb votes. This is one of those times for Representative Julie Coulombe (R – Anchorage).   

I did not have Governor Dunleavy and the Alaska Industrial Development and Export Authority (AIDEA) thanking Judge Sharon Gleason on my 2025 bingo card!  

I also did not have Senator Mike Cronk (R – Tok/Northway) attending the Alaska Kennel Club show on my bingo card. What a good looking dog! 

Fires continue to be set in homeless camps all around Anchorage. I fear we are doomed this summer as none of our leaders are willing to do what is necessary to deal with this problem. We must stop allowing and tolerating people to live and camp all over the city. That is the only way this gets fixed. 

And this happened tonight as I was writing this column from my office in Anchorage. An hour and a half later, I have still not seen or heard from the Anchorage Police Department. 

This sounds absolutely wild.  

This Week’s Loose Unit 

There were many good options this week, but one really stood out. This week’s Loose Unit is Representative Nellie Jimmie (D – Tooksok Bay).

First, Jimmie was not in Juneau on Monday (3/24/2025) when the House Finance Committee was taking up the supplemental budget. She phoned in, but when she was called on for a vote she did not respond. When they came back to her again and said her name several times, she finally voted. That was loose behavior, but did not quite rise to Loose Unit level. That came later. 

Keep in mind that Jimmie wanted to be co-chair after the election. 

On Thursday, Jimmie was spotted on a flight from Juneau to Anchorage. I eventually learned she was going to this festival in Bethel. A finance committee member leaving in the middle of the committee hearing budget amendments is loose. But it’s especially loose when the majority only has six of the 11 seats on the committee. Her absence makes it difficult to get a quorum or pass majority amendments if she is not available to call in. And not being in the room makes a big difference. 

Indeed, the committee was unable to take up any amendments on Friday and their meeting planned for Saturday was cancelled. It’s insane she left town in the middle of this. Classic Loose Unit behavior. She is probably also trying to avoid voting on any of those amendments to lower the PFD!

Even the lights in her office were off and her door was lock. Her staff seemed to have left the Capitol too. Maximum loose. 

If you have a nomination for this week’s Loose Unit, or if you have any political news, stories or gossip (or any old pics of politicians or public officials) please email me at jeff@alaskalandmine.com.