Palin proposes energy relief

Gov. Sarah Palin is proposing a $1.2 billion plan to subsidize energy costs for Alaskans, reducing their electric bills by 60 percent and providing each Alaska Permanent Fund dividend applicant with a debit card valued at $1,200 to be used for energy.

Electric costs around the state also would be subsidized.

At a Thursday press conference in Anchorage announcing her plans, Palin made frequent references to Juneau's energy crisis and noted the amount of electricity the city had been able to save since the April avalanches cut off its source of abundant hydroelectric power.

Later in the press conference, however, she talked about the possibility of not holding the special session scheduled for June 3 in Juneau so as to not "burden the community" while it is trying to conserve.

The Palin energy relief plan would require legislative action and cost about $1.2 billion, said Pat Galvin, commissioner of the Department of Revenue.

The biggest part of that would be the debit card plan, which would cost an estimated $730 million.

The debit cards would be taxable as personal income for federal income tax purposes, officials said.

The cards would provide $100 a month for each permanent fund dividend recipient for one year, or a total of $1,200. A child's energy credit would appear on his or her sponsor's card.

The cards could only be used for purchases from authorized energy vendors in Alaska, such as electric utilities, natural gas utilities, heating-oil distributors and other retail fueling stations.

Department of Commerce and Economic Development Commissioner Emil Notti said the energy relief would be for a single year only, so as to not create an ongoing cost to the state.

"It does it without creating an entitlement, without continuing government subsidy, which no one wants," he said.

Another part of the plan would have the state paying 60 percent of base electric rates around the state, but the specification of base rates would appear to exclude Juneau's high rates, driven up by the extra cost of diesel fuel.

At least two energy subsidy plans died in the last legislative session. Palin said her energy team put this plan together in a relatively short time. Some details have yet to be worked out, such as when it would be able to begin.

Palin said she hoped the Legislature would be able to adopt the plans in conjunction with a special session scheduled to begin June 3 to discuss a natural gas pipeline.

Juneau is in the midst of an energy crisis caused by loss of its hydroelectric power. Backup diesel generation is boosting residential electric rates from 11 cents per kilowatt-hour to 54 cents per kWh.

"They're getting a taste of what rural Alaskans and Fairbanksans have been paying for quite some time," Palin said.

Rep. Beth Kerttula, D-Juneau, said she was happy Palin was putting forward a plan, after similar plans had died for lack of support in the last legislative session.

"I'm very happy to see the governor and the Cabinet engaged in this issue," she said.

Kerttula said Palin's plan might treat people differently in different parts of the state, but it would help some people who are hurting, in Juneau and elsewhere.

"I don't fault her for coming up with an idea that puts money in people's hands," she said.

Palin raised capital move concerns again by questioning whether it was fair to "burden" a community in the midst of a crisis by having the Legislature come to Juneau for the special session.

Juneau Mayor Bruce Botelho said no one in Juneau considers that to be the case.

"It will in no way be a burden," he said. "We're the capital city, and it will be a priority for us."

Palin said that was what "some Juneau residents have told us," but made it clear she was not suggesting the session should be held in Anchorage.

"At this time, I'm not proposing to change it," she said.

She also said it was up to the Legislature itself, not the governor, to decide where to meet.

"I've been reminded by legislative leaders that I am not to tell them where to meet," she said.

Earlier in the day, House Speaker John Harris, R-Valdez, and Senate President Lyda Green, R-Wasilla, met with reporters to discuss the logistics of the special session. Both said they were planning on having it in Juneau, though some hearings would be held in remote locations, likely including the North Slope, Fairbanks, Anchorage, Kenai Peninsula and others.

Harris said those hearings would involve presentations by the administration and others, and testimony from the public. No original testimony will be done on the road, he said, all that will be done in Juneau.

The Palin administration plans its own presentation of the plans in Anchorage prior to the start of the special session, to which legislators are invited. After Harris and Green barred the use of legislative travel money to attend those sessions, Palin offered to use money from the Governor's Office budget to pay travel for out-of-the-area legislators.

Palin spokeswoman Sharon Leighow said she didn't know who in Juneau had said the Legislature would be a burden, but she said she knew people in the administration had been in contact with Botelho.

Botelho said Commissioner Galvin had asked him that question earlier, and he'd assured him Juneau very much wanted the legislators in town.

"We look forward to the return of the Legislature," he said.

Kerttula, too, said she had no idea who might have suggested the Legislature would be a "burden."

"She certainly did not hear it from the delegation," she said.

"I think it's going to be a good thing for the Legislature to be here when we are going through our conservation efforts," she said.

• Contact reporter Pat Forgeyat 523-2250 or patrick.forgey@juneauempire.com.