COVID-19 is dealing a heavy blow to the state’s economy as the effects of curtailing Alaskans’ inability to move around, work, buy things and go to school start to sink in.
Hundreds of people are suddenly out of work as restaurants, retail and service establishments are shuttered. Strict “stay at home” recommendations by state health officials and Gov. Mike Dunleavy are keeping people off the streets in hopes of slowing the spread of the virus.
Most of the summer 2020 tourist season appears to be lost because of cruise ship cancellations, and oil field operators are now working to keep their workers safe while struggling with low demand and crude oil prices that have plunged.
But now the state and federal governments are stepping in aggressive stimulus efforts and programs to help businesses and individuals.
A $2.2 trillion economic aid package is nearing approval by Congress that will include huge funds available for low-cost small business loans if firms agree to retain employees as well as enhanced unemployment benefits for laid-off workers. The federal government would even send a check to every American taxpayer, an idea perhaps inspired by Alaska’s Permanent Fund Dividend, or PFD.
In a Wednesday press conference held by President Donald Trump in Washington D.C., federal officials said they hope to get the money out quickly so that banks will be able to extend new lines of credit by late next week and individual checks showing up in taxpayers’ bank accounts or postal boxes in three weeks.
Meanwhile, in Juneau, the Legislature appears poised to approve not just one but possibly two $1,000 PFDs, one in a check sent out in early summer and the second later in the year at the time PFDs are normally paid.
There are questions as to whether the second payment is affordable given financial stress being experienced by the state itself, but it seems likely that at least one the payments will be approved.
The Legislature also rushed through a bill liberalizing requirements for unemployment benefits that will get the payments out more quickly as a wave of applications are filed. Gov. Mike Dunleavy has also proposed a major new state business loan program intended to get money for working capital to businesses.
Financial institutions like banks and credit unions would make the loans working with the Alaska Industrial Development and Export Authority, and the state would also guarantee the loans, the governor said last Friday. The Legislature must authorize the program, however.
Time is short for that, however. Legislators are rushing to finish vital business, like the budget, before taking a recess. They want to be out of the capitol building, where working conditions are cramped, before the first COVID-19 infection shows up. Lawmakers’ target date for taking a recess is this weekend. The plan is to come back later to finish things up when the COVID-19 scare dies down.
Meanwhile, several priority bills have advanced in the last two days:
• Reauthorization for TVEP (Technical Vocational Education Program) for one year, in HB 235, has passed both House and Senate and is now to the governor. This program allocates money to regional training centers and the university for its workforce programs. An earlier version on the bill had a three-year extension but this was shortened to one year so that legislators can review the program again next year.
• SB 115, the motor and marine fuel tax increase, was in the House Rules on Wednesday, one step away from passage on the House floor. If it does pass it is not clear whether the governor will allow it to become law or veto it. Funds raised through both taxes will be modest and would be designated to suppory highway and harbor maintenance.
• A bill extending the governor’s disaster emergency declaration, SB 241, is in House Rules and is expected to pass. An important provision of the bill is that it gives the state emergency authority to recognize professional licenses in key fields, such as nursing, from other states. A governor’s bill allowing Alaska to join a multi-state nurse license compact is bogged down in the Senate after many Alaska nurses opposed it and is effectively considered dead. With similar language now in the emergency disaster bill the governor is essentially doing an end run around the Legislature on this issue.
• SB 155, a revamp of statutes on administration of state mining leases, is on the House floor Wednesday but was rescheduled to Thursday. The bill makes technical changes to ease problems small miners have in ensuring compliance, so as to not jeopardize property rights.