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Analysis: In final day, major issues still unresolved

Education, budget debates loom

Posted: April 19, 2014 - 11:12pm

Legislators spent much of Friday and Saturday working to secure votes for various bills while tying up loose ends on others. With a midnight deadline looming to finish the state’s business, there’s much for lawmakers to accomplish concerning several pieces of key legislation.

The debate on two of the session’s biggest issues has been pushed to today. Those issues are education reform and funding and the capital budget.

The House Finance Committee worked late Saturday night on proposed changes to the capital improvements budget. That bill will likely be hotly debated on the House floor tomorrow, and it is unclear what proposed changes could be added to the bill.

As of press time Saturday, the projects budget still included funding to complete the State Libraries, Archives and Museum project, upgrade Juneau’s water projects and direct $35 million to the Juneau road.

The education reform bill, HB278, changed dramatically from Friday to Saturday, and both versions of the bill are distinctly different than the one approved by the House earlier this month.

The most recent amendments to the bill includes $124 million for schools this year, with about $24 million of that being devoted to new programs. That amounts to a $75 million increase in funding. The money, however, isn’t tied to a per-pupil increase known as the Base Student Allocation.

The increase is also partly shouldered by municipalities in the latest version of the bill, which has yet to clear the Senate floor. Even without knowing what the final Senate version will look like, there are enough major differences that the House is unlikely to agree with the Senate’s changes.

That means there will be another committee formed to hash out an agreement on education funding during the waning hours of session.

An unexpected factor

A bill to increase the state minimum wage, HB385, was introduced late in the session and was fast-tracked through the House.

The bill would kick an initiative to raise the minimum wage off the fall ballots, so labor union representatives have urged lawmakers to ignore the bill. The issue is rooted in history when legislators about 12 years ago passed a similar bill only to strip major components out the next year.

Opponents to the bill say Republicans are only pushing it to get the initiative off the ballot, and supporters say it is an effort to carry out the will of the people.

Both sides have accused the other of being motivated primarily by voter turnout and not by actually changing the wage. About 3,000 Alaskans are believed to work for the minimum wage.

The bill is a priority of House Republican leadership, but it currently lacks sufficient support in the Senate to pass. There is a strong effort by some to garner enough support to pass the bill before the Legislature adjourns.

If the Legislature adjourns after midnight, it is possible the minimum wage initiative — and others — could be pushed back to the November ballot. If the minimum wage bill passes the Senate, the initiative will be removed from the ballots entirely because it is “substantially similar” to the legislation.

PERS/TRS fix likely set

The Senate Finance Committee unveiled a new plan to fix the state’s growing unfunded liability in the public workers retirement systems. The proposal strikes a balance between the governor’s initial proposal and a legislative plan previously rejected.

The plan still calls for a $3 billion infusion in the retirement systems’ trust fund this year, but it stretches the payment plan out 25 years. The governor’s proposal called for 20 years with annual payments of $500 million.

Annual payments under the newest version of the bill would start at about $345 million next year and gradually increase to $514 million in 2038. The final payment would be $489 million in 2039.

It’s a plan that has the governor’s approval and is likely to pass the House as-is.

Proposed gasline project gets green light

Debate over the governor’s gasline bill, SB138, is also likely finished. Democrats sought to increase the state’s take by upping the tax rate on natural gas 3 percent, but that amendment failed on party lines Saturday.

The House Resources Committee’s changes to the bill dealt mostly with improving the public notice about the project’s developments as it goes forward. Amendments to the bill late Friday night in the House Finance Committee inserted sections that allow the state to have it’s corporate partners in the mega-project sell Alaska’s gas at market for the state and require all partners to share indirect costs associated with building the 800-mile pipeline from the North Slope to Nikiski.

Another change requires the producers to sell Alaska natural gas to the state at a reasonable rate should public consumption increase.

The House still has to vote on the bill Sunday but the contentious debate has concluded.

• Legislators were still meeting as of press time.

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