As the House moved Thursday to end debate on budget amendments – there have been over 50 debated on the floor over four days – the Senate Finance Committee began taking public testimony on its own version of the operating budget that cuts education and health by five percent.
Gov. Bill Walker recommended a $4.2 billion FY 2018 operating budget, a reduction from FY 2017 of about $60 million in unrestricted general funds (UGF).
House subcommittees added $13 million in agency operations spending, including federal funds, to Walker’s request.
“I think that our budget reflects the values we have,” House Finance Co-chair Paul Seaton (R-Homer) said during a press conference Thursday when discussing the subcommittees. “We really didn’t find areas that said, ‘We shouldn’t be doing this.’”
In contrast, Senate subcommittees are recommending a $58 million reduction in agency operations spending beyond what Walker has suggested.
On Wednesday, The Senate Finance Committee rolled all the subcommittee recommendations into a committee substitute for SB 22. There was no debate.
Before hitting the House floor, the House budget totaled $5.1 billion and increased UGF spending by $70 million because it includes a Permanent Fund dividend (PFD) larger than $1,000. Yet agency spending would be cut by $114 million.
At this point, it is not possible to compare House and Senate budget totals because the Senate CS does not include education funding.
“In this version of the bill, there’s no funding, as of yet, for K-12 foundation formula and pupil transportation,” James Armstrong, aide to Senate Finance Co-chair Lyman Hoffman (D-Bethel) said during a brief hearing.
The absence of education funding distorts the entire budget, making it appear that the Department of Education & Early Development (DEED) has been cut by $1.25 billion and that the entire operating budget is $3.6 billion.
There is no FY 2018 deposit in the Public Education Fund in the House budget, either. However, the House budget deposits $1.7 billion from the Permanent Fund earnings reserve in the Public Education Fund for FY 2017, making the FY 2018 deposit unnecessary.
The difference appears in the Fund Transfers section of the House budget, so it does not impact agency operations numbers.
The $58 million cut in the Senate budget is a far cry from the $300 million Senate leaders are targeting, but leaving education funding out of the CS opens the door for further cuts during Senate Finance amendments.
Armstrong said amendments are due to Hoffman’s office by Monday afternoon.
Public testimony on the budget began Thursday with Juneau, Glennallen, Seward, Homer, Anchorage, Kenai, Kodiak, Dillingham, and off-net sites.
Five-Percent Cuts Include Public Health Nursing, Public Assistance
Hoffman has said the Senate will be looking to cut five percent from the budgets of DEED, the Department of Health & Social Services (DHSS), the Department of Transportation (DOT), and the University of Alaska (UA).
“We did not include an amount… for education, but it is contemplated that may be five percent,” Hoffman reiterated Thursday during a hearing. “Over the course of the last four years, the education budget has received the second-lowest reductions of any department.”
“We are in difficult times. We are facing a deficit of close to $3 billion,” he continued.
Senate Finance’s Permanent Fund restructuring bill, SB 26, passed the Senate on Wednesday, but it still leaves a deficit of $800 million.
The five-percent cut is clearly reflected in all of the targeted budgets, except DEED.
The UA budget, which is effectively a block grant, would be cut by $16.8 million.
The DHSS subcommittee recommended that personal services be cut by 2.75 percent for the Alaska Psychiatric Institute, Pioneer Homes, McLaughlin Youth Center, front line social workers, senior and disabilities services, public assistance, and public health nursing.
Public health nursing would receive an additional five-percent cut beyond personal services.
The Senate is recommending an $18 million cut to Medicaid because it says savings from last year’s Medicaid reform bill (SB 74) are not reflected in Walker’s budget. Senate Majority Leader Peter Micciche (R-Soldotna) added a $150,000 cut for medically-necessary abortions paid for by Medicaid.
Adult public assistance would be cut by $3.5 million, and Temporary Assistance for Needy Families (TANF) would be cut by $3 million.
DHSS cuts are exactly a five-percent UGF reduction.
Walker had already proposed a cut to DOT of more than $70 million. The Senate subcommittee recommended adding $70,000 in total funds to Walker’s request, but the UGF reduction would be 37 percent from FY 2017.
A transaction detail for DEED does not reflect a $1.25 billion cut to formula funding, but it does recommend the elimination of pre-Kindergarten grants and programs, totaling $2.8 million.
Residents of Juneau who testified Thursday, many with children on hips, opposed cuts to the Best Beginnings and Parents as Teachers programs, which have been targets of cuts the last couple years.
Another common target that reappears in the Senate CS is public broadcasting. The Department of Administration subcommittee eliminates State support for public radio and TV, totaling $2.8 million.
Public testimony on the Senate budget will continue Friday afternoon with Bethel, Nome, Kotzebue, Unalaska, Barrow, Tok, Delta Junction, Ketchikan, Wrangell, Petersburg, Sitka, Cordova, Valdez, Fairbanks, and the Mat-Su.
Written testimony can also be submitted at Finance.Committee@akleg.gov.
Like testimony in person or by phone, testimony submitted in writing becomes part of the public record.
House Majority Says, “Enough is Enough,” Ends Debate on Amendments
None of the cuts listed above appear in the House budget, meaning they would all have to be debated in conference committee if they survive the Senate budget process.
House Rules Chair Gabrielle LeDoux (R-Anchorage) moved to close debate on any remaining amendments at noon on Friday, so the House may be able to pass its version of the operating budget (HB 57) late Friday.
LeDoux’s motion was not subject to debate.
It passed along caucus lines, 21-17. Rep. Colleen Sullivan-Leonard (R-Wasilla) was absent. Representatives Matt Claman (D-Anchorage) and Mark Neuman (R-Big Lake) were excused.
The majority and minority caucuses subsequently held dueling press conferences to explain their positions.
“We felt it was necessary today to take decisive action and to certainly provide the minority ample opportunity for their voice to be heard in the budget process, but as well to say, ‘Enough is enough,’” said House Speaker Bryce Edgmon (D-Dillingham). “We think the public’s had enough, and it’s time to move on to other important legislation in the building.”
“We’re at a point right now where we’ve entertained what the minority has wanted to do, and we can only do it for so long,” said House Majority Leader Chris Tuck (D-Anchorage).
Tuck said that as the minority leader, he always told the Speaker how many minority amendments to expect.
“We have no idea how many more amendments they have,” Tuck said of the current minority. “They trickle in just a few at a time.”
When asked how many minority amendments there are, Rep. Tammie Wilson (R-North Pole) told reporters, “I really don’t know.” Wilson guessed the count was around 100.
Seaton said that House Finance already dealt with 330 budget amendments, most of which were written by Wilson.
“Every single thing in House Finance came to a full vote of the committee, majority and minority. Nothing was rolled into the budget that wasn’t voted on,” he said, drawing an unintentional comparison to the Senate process.
The House majority would like to work on its deficit reduction plan and oil tax reform, said Seaton, but “We’re not getting there with this continuous slow roll of amendments and amendments written on the floor to other amendments that were already on the desk for a full day.”
Seaton was alluding to a handwritten amendment from Rep. David Eastman (R-Wasilla) that would have directed the Legislative Affairs Agency to secure housing in Juneau for legislators.
Eastman’s move extended debate on the underlying amendment, an $860,000 cut to legislative per diem. It lasted all morning.
“We just spent two-and-a-half hours on one amendment… when we’ve got a fiscal crisis that we’ve got to resolve,” LeDoux said. “At some point, you’ve got to figure out which are the important- the critical- amendments and have a robust debate on those, instead of a few things dribbling here and dribbling there.”
“If we don’t start working on the things to get us out of this recession sooner, we are going to be in a ten-year recession,” said House Finance Vice-chair Les Gara (D-Anchorage).
Who is Filibustering Whom? Minority Questions Majority’s Competence
Edgmon said the amendments seemed “poised to go well into the future.”
“It’s a filibuster,” declared Gara. “You know you’re in a filibuster when five members speak up about how they want the government to help them get housing when they come to Juneau. You know you’re in a filibuster when 15 percent of their amendments have to do with cutting public safety in rural Alaska under the Village Public Safety Officer program.”
“At some point, you know when you’re being gamed,” he said.
“We don’t know what they’re doing,” clarified Tuck. “We just don’t want it to be a filibuster, but when you look at the slowdown that we’ve had, it’s hard to look at it any other way.”
“Their members are filibustering just as long,” House Minority Leader Charisse Millett (R-Anchorage) said of the majority. “They’re filibustering more than we are.”
“We have taken lunch breaks. We have taken dinner breaks, and then we are sent home by 8:45 every night,” said Millett. “That is not how the legislature works. We are ready to work.”
“Every single one of my members is ready and willing to go all night on a budget debate because that’s how it’s done,” she added.
Several minority members said the delays on the floor are because majority members don’t understand how amendments impact the budget.
“They’re presenting them in obtuse ways, and it’s been very dilatory,” Rep. David Guttenberg (D-Fairbanks) said of the minority amendments.
When asked why the minority did not present their amendments sooner to allow time for study, Wilson responded, “Why is it our job to do their job?”
“They’re just mad because they couldn’t have somebody else write their talking points like they had in Finance,” said Rep. Lance Pruitt (R-Anchorage), alluding to the subcommittee chair scripts used to oppose amendments.
“If the majority is not ready for this debate, that’s on them,” said Millett.
Millett and Pruitt both said that LeDoux’s and Edgmon’s decisions to not allow minority members to use terms like “slush fund” or “bureaucrat” infringe on their First Amendment rights.
“It’s a nice parlor trick to do to silence, but I will tell you in my nine years as a legislator and being down here as a staffer before that, I’ve never seen a Speaker act in the manner which he’s acting,” said Millett. “It’s a shame that Speaker Edgmon feels that he has to do this.”
Following the 2016 election, Edgmon broke from the current minority caucus, helping give the current majority caucus enough members to constitute a majority.
“Not once have we ever limited debate to the minority on amendments,” said Rep. Mike Chenault (R-Nikiski), who presided over the House for eight years under the former majority.
Despite the size of the deficit and the relatively small number of cuts the minority is offering, Millett said the budget is the greatest focus of her caucus. She said they need to know the actual size of the deficit before they look to fill it with taxes or cuts to the Permanent Fund dividend (PFD).
“There have been no cuts in the Finance Committee or on the floor, except for today on per diem,” alleged Millett. “There is not much that has changed since the governor introduced that budget. It’s gone up. So it tells me that the House majority is comfortable with the size of government and comfortable growing the size of government and is more focused on taking money out of people’s pockets and taking their dividends than they are about reducing the root problem of our fiscal problem, which is the ever-growing operating budget.”
“My caucus does not feel comfortable restructuring the Permanent Fund or instituting an income tax at the level of spending and the priorities of levels of spending that we’re doing,” she concluded.
The relationship between the two caucuses has turned quite sour.
The House minority press conference lasted beyond the House floor recess. The House did not delay, moving on to consideration of the next amendment before most minority members had taken their seats.