There are about three and a half weeks left in the 2021 legislative session and the pace is quickening in Juneau.
Committee schedules are getting crowded with bills as lawmakers cajole committee chairs to hold hearings and move their bills. The House Finance committee, through which most bills pass in addition to the budget, now meets twice daily. The Senate Finance committee meets daily.
Under the constitution the Legislature must adjourn May 19, and though there are provisions for a 10-day extension this requires a three-quarter vote of both the House and Senate, which will be difficult to get this year with the close partisan split in the state House.
House Finance Committee cochair Rep. Neal Foster, D-Nome, said Thursday that the committee’s proposed operating budget will be available in draft form over the weekend and will be before the House Finance Committee for amendments this week. It is expected to pass the House and sent to the Senate May 3 or 4, Foster said.
The bill will incorporate funds from the American Rescue Plan Act recently approved by Congress but fine-tuning of this will be needed once guidance is received from the U.S. Treasury, now expected May 11. Legislators and the governor have a good idea of what will be acceptable to the Treasury, but any budget fine-tuning can be worked out by the Senate and in a House-Senate budget conference committee, he said.
The $1.1 billion in new federal aid given the state recently by Congress in the ARPA is now a big focus of legislators. The Treasury may send the money in segments, such as half in 2021 and half in 2022, but the Legislature and governor are likely to appropriate it that way in any event, Foster said Thursday.
The governor’s approach is to appropriate the entire $1 billion this year but to spread its expenditure over several years, Foster said.
Meanwhile, other ARPA funds in addition to the $1 billion for the state itself are going to school districts and municipalities directly, and although these flow through the state as a technicality Congress has designated their uses and the Legislature, and governor, have no control on the funds.
School districts and municipalities will have to follow federal guidelines and demonstrate some connection to COVID-19, which shouldn’t be difficult, but an important difference is that ARPA, in 2021, allows money to replace lost municipal revenues while the CARES act funds in 2020 did not permit this.
Of the state’s $1 billion that can be used at its discretion, the governor proposes $150 million to be used in a special tourism marketing program in an attempt to salvage a limited 2021 summer visitor season. If cruise ships sail at all this summer, they will be late. In the meantime, the state and regional visitor groups are working with airlines on special promotions.
Gov. Mike Dunleavy’s priority bills for the session, including his Permanent Fund bills, are at risk of getting lost in the rush of legislation as the session-end nears. However, Foster said he believes that once the state budget is before the full House later this week and next the discussion will turn to how much of a Permanent Fund Dividend can be afforded, and how it can be funded.
One of the governor’s bills that is moving, and may get through the gate by May 19, is a plan for new state lending program to boost renewable energy use and energy conservation, including residential and commercial building retrofits and other measures. Several years ago, the state had a very popular grant program that helped homeowners pay for home energy conservation projects and it paralleled a home “weatherization” grant program for low-income families, but the popular residential “rebates” were discontinued when the state encountered financial headwinds.
The new program would involve low-interest loans with long terms backed by the state’s Alaska Industrial Development and Export Authority, the state development finance corporation, in partnerships with banks and private financial institutions.
The concept, known as a “Green Bank” has been done successfully in several states and is now proposed on a national level in a “sustainable energy” bill pending in Congress. Chris Rose, a Sutton resident who helps direct the Renewable Energy Alaska Project, has been deeply involved with the governor in developing the idea.
Experience in other states show that for every state dollar invested in financing sustainable energy there are several dollars invested through leveraging with banks, private investors and others.
The House version of the governor’s bill passed out of the House Energy Committee last week is now in the House Labor and Commerce Committee, with hearings planned this week. The Senate version is now in the Senate Finance committee after having passed earlier from the Senate Labor and Commerce committee.
One controversial bill that is pending is House Bill 76, extending the state health emergency declaration. The previous emergency declaration expired in February. The governor originally introduced HB 76, extending the emergency, but then changed his mind, feeling it is no longer needed. Health professionals disagree with that, arguing that the emergency allows for important flexibility in federal health regulations and also allows for things like telehealth service for Alaskans by out-state-medical specialists.
A separate bill is pending that would allow telehealth in case HB 76 does not pass. The bill narrowly passed the House and has gone through the Senate Finance committee. It Is now in the Rules committee awaiting scheduling for Senate floor action. There is a possibility that the governor may veto the bill if it passes the Senate, which is not certain.