Alaska Legislature lacks agreement on new PFD formula as end of special session approaches

JUNEAU — The Alaska Legislature’s special session is scheduled to end Tuesday, and legislative leaders believe they will pass a telehealth bill and legislation setting the 2021 Permanent Fund dividend before the session expires.

The state House approved a $1,100 dividend earlier this month, but that amount could change in the Senate.

If senators make no changes to the House bill, lawmakers say they believe Gov. Mike Dunleavy may veto the dividend, as he did earlier this year. A spokesman for the governor said no decisions have been made.

Though the session was called by the governor in an attempt to pass a new formula for paying future dividends, there remains no agreement on what that formula should look like, though legislators said they have made progress.

Senate President Peter Micciche, R-Soldotna, said it’s possible that the Senate approves a “framework” for further action, but both he and Speaker of the House Louise Stutes, R-Kodiak, said a firm solution will not happen before the session ends Sept. 14.

“For some reason, people think it’s going to be magic, and it’s going to happen between here and the 14th. It just isn’t going to happen between here and the 14th. And so we have to take it one step at a time,” Stutes said.

“The comprehensive fiscal plan is not likely going to get all the boxes checked this special session,” Micciche said. “But that work is continuing. Conversations are continuing. Committee work will continue, and I think we can get there.”

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In the Senate, lawmakers are moving quickly on legislation that would make it easier for Alaskans to consult with out-of-state doctors and nurses via the internet.

That bill, which Dunleavy says would help with the current COVID-19 surge, could receive a vote of the full Senate as early as Thursday. If approved then, it would advance to the House for consideration and action before the end of the special session.

Legislation to pay this year’s dividend is in the Senate Finance Committee and, under a schedule announced by Sen. Bert Stedman, R-Sitka, would not face a vote of the full Senate before Friday at the earliest.

Micciche said he doesn’t know whether the Senate supports the $1,100 amount proposed by the House, the $2,350 proposed by Dunleavy, or some other figure.

The House proposal is partially funded by $330 million from a savings account known as the Statutory Budget Reserve. The Dunleavy administration says that account is empty. Legislators, relying on different legal guidance, say the money is available.

“For all legal purposes, there is no money in the SBR available for additional appropriations as of June 30, 2021, at midnight, because the remaining fund balance (beyond those amounts validly committed through HB 69) were swept as of 11:59 pm that night,” said Jeff Turner, a spokesman for the governor.

Legislative attorneys disagree, citing a recent Superior Court ruling that preserved funding for the state program that subsidizes electricity in rural Alaska.

To sidestep a potential lawsuit, the Alaska Senate could instead fund the dividend from a different savings account called the Constitutional Budget Reserve. Doing so requires approval from three-quarters of the state House and three-quarters of the state Senate, and it isn’t clear whether there are enough votes to do so.

If the Senate approves the House-passed dividend, Dunleavy could veto it as he did earlier this year, or he could veto just the part dealing with the Statutory Budget Reserve, lowering the dividend to about $600.

Turner said the governor will wait to see what action the Senate takes.

In a radio interview last week, Dunleavy said that given the Legislature’s failure to approve a new dividend formula, he was considering whether to call lawmakers into a fourth special session, possibly away from the state Capitol in Juneau.

Stutes said that might not be helpful because lawmakers have already been in session for more than 180 days in Juneau this year.

“I’ll tell you something. People in this building are tired. They are tired,” she said. “And I think it would be very foolish on his part to immediately call us right back because there is just not the wherewithal, from what I can tell, in this building. People want a break. You know, it’s hard to be away from home.”