House sends crime bill back to Senate; budget hearings commence

The House made headway Nov. 7 on both of the agenda items on Gov. Bill Walker’s special session call

However, there still does not appear to be any interest from the Republican-led Senate Majority in approving the governor’s proposed employment tax, or any tax for that matter.

In the early morning hours of Nov. 7 the House passed Senate Bill 54 by a 32-8 vote with a bipartisan group of Fairbanks and Matanuska-Susitna area representatives voting against it after long days of floor sessions throughout the weekend.

The amendment process was rigorous with nearly 50 proposed changes but most of them were voted down.

SB 54, which the Senate passed last spring, is a tightening of some of the sentencing guidelines for misdemeanor and low-level felony crimes relaxed the omnibus criminal justice reform legislation passed early in 2016 under Senate Bill 91. The bill will cost the Department of Corrections an additional $3.6 million to account for additional incarceration time, according to the fiscal note.

The changes the House made to SB 54 will require a concurrence vote from the Senate. If the Senate doesn’t concur it could add a couple weeks of work closer to the end of the 30-day session.

Later Nov. 7 the House Finance Committee heard from Office of Management and Budget Director Pat Pitney on the state’s fund balances and budget reductions in preparation for beginning hearings on the administration’s tax proposal.

The 1.5 percent payroll tax would be capped at either a $2,200 payment or twice the previous year’s Permanent Fund Dividend and would raise about $320 million per year once fully implemented in 2020, according to the Revenue Department.

Walker has stressed it would leave Alaskans the lowest-taxed people in the country and is necessary to link government’s ability to provide services with economic growth.

Walker and Senate President Pete Kelly, R-Fairbanks, exchanged jabs through newspaper editorials in which Kelly questioned if the administration’s low oil production and associated revenue forecasts released this past spring were artificially low to justify the need for a tax. An updated production forecast for the current fiscal year raised the spring estimate from 459,000 barrels per day to a projected third straight year of increases at 531,000 barrels per day.

The governor responded that he shares Kelly’s excitement over increased oil production but is “sorely disappointed that he continues to issue statements that rationalize ignoring our fiscal crisis.”

As of this writing the Senate Finance Committee had a hearing scheduled for the governor’s tax bill Nov. 9, but that is just as likely a courtesy review of the bill as a signal the Senate Majority will act on it.

The Finance committees can also use this time to gather background information ahead of the budget process during the regular session, which figures to be another tough battle and continue to feature the same fiscal issues dealing with multi-billion dollar annual deficits.

SB 54 could also end up taking a majority of the remaining time in the special session. The Senate Finance Committee also had a hearing tentatively set on that bill for Nov. 10.

The special session ends Nov. 22, the day before Thanksgiving.

Elwood Brehmer can be reached at [email protected].s

11/08/2017 - 10:30am