Senator Dennis Egan's Newsletter
Sen. Dennis Egan, D-Juneau

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       Juneau, AK 99801-1182

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Volume 8: Issue 12 June 10th, 2016

Dear Friends and Neighbors,

We are still at it in this 4th special session of the 29th Legislature.
No Pink Slips... Yet…Yet!

It’s been a busy couple of weeks, with some major highs and lows.  We got the budget passed in time to avoid the June 1 deadline to send public employees layoff notices.  The budget cuts will lay off far too many people already – sending pink slips to people we have no intention of actually firing would just be wrong.  We shouldn’t have to go through this every year, either, but until we address Alaska’s fiscal problems, I’m afraid public employees will keep getting used as pawns.

So this newsletter comes in the middle of a five-day break in the special session.  It sounds weird to take a break with the work not finished yet, but really it means no floor sessions or committee meetings while the capital city hosts Celebration.  Between events I’ll still be working: The numbers are pretty straightforward.  Three years ago we spent about $5.5 billion of general funds each year to operate state government, including public schools (not counting the capital budget.)  Next year it will be about $4.3 billion.  That’s a lot of cuts, and they’re going to hurt!  But we get about $1.3 billion in taxes.  So while we’ll keep watching spending, Alaska needs some more income to close a $3 billion gap.

And let’s just be clear about something.  We spend less than $3 billion on the salary and benefits of every single state employee combined (It’s closer to $2.2.) That means we could fire every single state employee in Southeast Alaska and not come close to fixing the problem.  Keep that in mind the next time someone tells you all we have to do is cut the budget.

Oil & Gas Tax Credits and PFDs

We’re also spending crazy amounts to subsidize oil & gas.  Don’t get me wrong: oil pays for most of our budget, so we don’t want to run off the industry.  But when we’re paying out more in credits than we get in production taxes, we’ve gone overboard.

The governor gave us a bill to reform our oil & gas tax credits that was pretty good. I could have supported the version the House passed, too, even though it was a little weaker.  But when HB 247 hit the Senate floor, it was gutted so badly it saved almost no money.  We need meaningful reforms, so I voted no.  Same thing for the conference committee bill that was worked out between the House & Senate versions.  Now it’s up to the governor whether to sign or veto it.

Many of you shared your thoughts with the Governor already – if not, please contact him.

Alaska Permanent Fund Protection Act

That brings us to SB 128.  I don’t really like it, but I voted for it because it’s the only thing that makes a difference of more than a billion dollars in our multi-billion dollar fiscal gap.  It was a tough vote because it’s really unpopular, and because it doesn’t by itself complete the fiscal plan. 

I voted yes because it’s an important piece. And if we don’t start fixing this gap before we burn through all our savings, there is no way Alaska will keep sending anybody any kind of PFD, much less the $1000 under the bill.  So it stabilizes our dividends and keeps good protection for the principal of the Permanent Fund (as the Constitution requires.)  Next we need real reform of oil tax credits and an income tax so out-of-state workers contribute something, too!

I know not everyone will like reducing the dividend from last year’s amount, but there is just no way we can cut that much.  And an income tax that raises the same amount would have to be about three quarters of what we pay in federal taxes – more than double the highest state income tax rate in the nation.

Capital Budget

If you’ve kept track of how our region did in the capital budget for the past several years, you’ll notice a big difference this year.  Just about everything is major maintenance, there’s pretty much nothing new.  That’s the responsible approach when money is tight.  I also want to point out that most of the money in this list is either federal dollars, or ‘recycled’ money from other projects that came in under budget.  So here’s what we’ll do in Senate District Q:



Fund Source

State Office Building Mechanical Repairs, Phase 2 of 2 $2,000,000 Public Building Fund
State Office Building Electrical Repairs, Phase 2 of 2 $2,000,000 Public Building Fund
Capitol Third Floor Improvements $475,000 JCF Grant
Marine Exchange of AK Vessel Tracking System Upgrades & Expansion $400,000 State Cruise Tax
Johnson Youth Center Walkway Covering Replacement $375,400 GF
Pioneer Homes, add ADA-Compliant Showers (Licensing Requirement) $141,600 GF
Municipal Harbor Facility Matching Grant: Aurora Harbor Restoration $2,000,000 GF
Egan Drive and Riverside Drive Intersection Improvement $1,000,000 Fed
Egan Drive Improvements, Main St. to 10th $1,000,000 Fed
Glacier Highway Improvements, GHAR to Twin Lakes $5,500,000 Fed
Haines Highway Rehabilitation & Reconstruction $30,000,000 Fed
Haines Sewer Treatment Plant Health & Safety Upgrades $1,040,000 GF

SLAM Dunk! 
It’s done and it’s a gorgeous building inside and out!

I’ve written about the Father Andrew Kashevaroff State Library, Archive, & Museum project in the past.  It’s finally open! The grand opening was great, but the exhibits and library are even better.  If you haven’t gone yet, it’s time!

I was honored to speak at the dedication.
I was honored to speak at the dedication.

Sen. Johnny Ellis of Anchorage was a long-time champion, and a friend of Southeast.
Sen. Johnny Ellis of Anchorage was a long-time champion, and a friend of Southeast.

Governor Walker and elder Marie Olson both spoke beautifully.
Governor Walker and elder Marie Olson both spoke beautifully.

Enjoy all that Celebration has to offer!

Governor Walker pulls with Southeast Native Veterans at an opening day event
Governor Walker pulls with Southeast Native Veterans at an opening day event

Kudos from Juneau

Thanks to these community members for
helping make Southeast
a great place to live!

The More We Learn – The Multiple Sclerosis Society will host “Mood & Cognition in MS: What You Can Do” tonight: Friday, June 10 from 6:00 - 8:00 pm in Room 204 of the Robert F. Valiant Building at Bartlett Regional Hospital. It’s your chance to learn about how MS can affect mood and cognition and the most successful ways that individuals, researchers and clinicians have developed for approaching these "invisible symptoms".

A First – Jacob Calloway graduated from Thunder Mountain High School last year, and played academy hoops in Oklahoma for a year.  It paid off, and he’s about to become TMHS’ first-ever Division 1 college basketball player.  He just signed with Southern Utah University in the Big Sky Conference.  Being 6’ 8” doesn’t hurt, but it’s his hard work that got him to this point!

Great Spotting – Sharp-eyed bird watchers spotted the first documented white-faced ibis in Southeast Alaska recently.  One was spotted on Prince of Wales, and others near Haines, in a first that’s apparently turning the bird-watching world on its head.  Kudos to sharp-eyed Haines folks for putting our region on the map in yet another good way.

Unbelievable – Every time I see Celebration it’s bigger, more extensive, and more inspiring.  It just blows me away how amazing the Tribal community is in our region, and how many powerful things happen at this every-other-year event.  Kudos to everyone involved!

Thanks for reading Legislative Corner.  I hope you'll always feel welcome to contact my office, just call, write, or use one of the links in this newsletter.

[signed] Dennis Egan

Dennis Egan
Alaska State Senator
District Q

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