Alaska Supreme Court rules bonding plan is unconstitutional

Alaska Supreme Court rules bonding plan is unconstitutional

The court said the Legislature-approved plan is “unconstitutional in its entirety.”

BECKY BOHRER

Associated Press

The Alaska Supreme Court on Friday rejected as unconstitutional former Gov. Bill Walker’s proposal to use bonding to pay Alaska’s oil and gas tax credit obligations.

The court, in a written ruling, said the plan which was approved by the Legislature in 2018, is “unconstitutional in its entirety.”

The bill passed by lawmakers approved the creation of a new state corporation that would be empowered to sell up to $1 billion in bonds to pay off remaining tax credit obligations. The Legislature previously voted to end the tax credit program geared toward small producers and developers, saying that the program had become unaffordable.

The state constitution limits the power to incur state debt. But a 2018 legal opinion by then-Attorney General Jahna Lindemuth said the proposed bonds would not be considered state debt subject to the constitutional restraints because they would be “subject-to-appropriation” bonds and contingent upon annual legislative appropriation decisions.

Superior Court Judge Jude Pate dismissed the lawsuit brought by resident Eric Forrer, who had challenged the bonding plan. Forrer appealed.

The Alaska Supreme Court, in its decision, said subject-to-appropriation bonds are “contrary to the plain text of the Alaska Constitution and the framers’ intent.”

“If the State intends to utilize financing schemes similar to HB 331 in the future, it must first seek approval from the people — if not through a bond referendum then through a constitutional amendment,” the opinion states. HB 331 refers to the bonding bill.

Joe Geldhof, an attorney for Forrer, said “the real winner here” is Alaska’s constitution and the citizens of the state who won’t incur “needless debt based on a scheme.”

An email seeking comment was sent to the state Department of Law.

More in News

The Aurora Borealis glows over the Mendenhall Glacier in 2014. (Michael Penn / Juneau Empire File)
Aurora forecast

Forecasts from the University of Alaska Fairbanks’ Geophysical Institute for the week of Nov. 27

Steve Lewis, foreground, and Stephen Sorensen from the Alaska State Review Board scan ballots from precincts where they were hand counted at the Division of Elections office Nov. 15. Board officials spent the period between the Nov. 8 election and its certification Wednesday performing about 20 different to verify the results. (Mark Sabbatini / Juneau Empire)
Election certified, but challenges pending

Outcome of at least two state House races unknown, which may determine chamber’s leadership

Errol Culbreth and Scotlyn Beck (Polichinelles) rehearse ahead of Juneau Dance Theatre’s production of “The Nutcracker.” The immensely popular ballet is coming to the Juneau-Douglas High School: Yadaa.at Kalé Friday through Sunday. (Ben Hohenstatt / Juneau Empire)
Juneau Dance Theatre is ready to get cracking

“The Nutcracker” is set to run Friday, Saturday and Sunday.

In this photo provided by the National Transportation Safety Board, NTSB investigator Clint Crookshanks, left, and member Jennifer Homendy stand near the site of some of the wreckage of the DHC-2 Beaver, Wednesday, May 15, 2019, that was involved in a midair collision near Ketchikan. The National Transportation Safety Board said Tuesday that the Federal Aviation Administration should tighten rules about minimum visibility during flights and require more weather training for pilots who fly around Ketchikan.  (Peter Knudson/NTSB via AP)
Safety board recommends new measures for Alaska air tours

The board wants regulations for Ketchikan similar to requirements in Hawaii and the Grand Canyon.

(Michael Penn / Juneau Empire File)
Police calls for Wednesday, Nov.30

This report contains information from law enforcement and public safety agencies.

Harbor seals have a face full of whiskers, which the seals use to follow hydrodynamic wakes left by prey fish; even a blind seal can track a fish this way, discriminating victims by size and shape and direction of movement.  (Courtesy Photo / Jos Bakker)
On the Trails: The sense of touch

Touch is a mechanical sense, detecting physical stimuli such as pressure, texture,… Continue reading

(Michael Penn / Juneau Empire File)
Police calls for Tuesday, Nov. 29

This report contains information from law enforcement and public safety agencies.

(Michael Penn / Juneau Empire File)
Police calls for Saturday, Nov. 26

This report contains information from law enforcement and public safety agencies.

Sugar Bear Alaskan Treasures, seen here, was one of many artist vendors featured at the Central Council of the Tlingit and Haida Indian Tribes of Alaska Indigenous Artists & Vendors Holiday Market from noon to 5 p.m. on Friday through Sunday at Elizabeth Peratrovich Hall. (Jonson Kuhn / Juneau Empire)
Indigenous Holiday Market features local artists

Market’s first return since 2018.

Most Read