Juneau Democratic Rep. Justin Parish guided his second bill across a finish line in the Alaska House of Representatives on Thursday as the House voted 21-16 in favor of his proposal to turn the state’s school trust fund into something akin to the Alaska Permanent Fund.
House Bill 213, which is expected to go to the Senate after a reconsideration vote, would increase the amount of money earned from the trust fund for the Alaska Department of Education, Parish said.
“It’s a good, simple piece of legislation,” he said before the vote.
“If my bill had been law in 1984, the public school trust fund would be twice as large as it is today,” he said, and have paid twice as much money to the state.
If signed into law, HB 213 would allow the state to annually spend 4.75 percent of the fund’s five-year average value. The fund would be invested more aggressively, and the fund’s principal would be protected, Parish said.
At present values, the fund is expected to generate $27 million per year. At expected growth rates, that would grow to $50 million per year within 20 years, and without any additional contributions to the fund by the state.
Parish’s bill was opposed by the Republican House Minority and Rep. Sam Kito III, D-Juneau. Kito was the only member of the coalition House Majority to vote against it.
“House Bill 213 would not result in any additional funding for education, which is determined by the Base Student Allocation,” Kito said in an emailed statement provided by a staffer.
“While we may want to look at all of our specialized funds to determine how to make them more stable and productive, I do not think that a percent of market value (POMV) approach is the best way to move forward, in the same way that I do not believe that a POMV approach is the best path forward for restructuring the permanent fund,” Kito wrote.
Speaking in opposition on the House floor, Rep. Tammie Wilson, R-North Pole, said she worries that the strategy enshrined in HB 213 is too risky for the trust fund.
“I play the stock market, but I don’t play the stock market with everything I have. Do you really want to play that game?” she said.
Rep. Les Gara, D-Anchorage, followed Wilson’s comment by saying HB 213 is simply a way to bring the trust fund into the modern system of investments instead of something “from the 1950s.”
“It does it in a safe way,” he said.
The idea behind Parish’s bill is not a new one for the Legislature, which has previously considered the topic. In 2002, for example, then-Sen. Gene Therriault suggested a 5 percent draw as part of a larger bill. The idea was renewed in 2007 by then-Rep. Mike Hawker, R-Anchorage. Neither bill advanced to a floor vote. Both of those bills were sponsored by Republicans.
Parish, elected to the House in 2016, is the only freshman Democrat remaining from that election. Democrats Zach Fansler and Dean Westlake, also elected in 2016, resigned amid scandal and have been replaced by interim appointments. Rep. Jason Grenn is an independent from Anchorage who also caucuses with the House Majority. Grenn has had no prime-sponsored bills pass the House. Parish’s first bill, dealing with the employment of military veterans, passed the Alaska House, but has been awaiting a hearing in the Senate State Affairs Committee since last year.
Fast-track vote approaches in Senate
The Alaska Senate did not hold a floor session on Thursday, but one has been scheduled for Friday morning. Atop that session’s agenda will be House Bill 321, a stopgap funding bill that contains money to keep the Alaska Marine Highway and Alaska Medicaid programs (among others) operating past the next few weeks. Medicaid funding may run out as soon as the end of March, state officials have said, and the Marine Highway will run out of money April 16.
HB 321 was advanced by the Senate Finance Committee on Thursday morning, and its last stop in the Legislature is a vote of the full Senate. After that, it must be signed by Gov. Bill Walker to become effective.
The elements of HB 321 were confirmed in negotiations among the leaders of the House and Senate finance committees, and no significant problems are expected.
Keep a load on
The Alaska House voted 33-4 on Thursday to increase the penalty for Alaskans who fail to secure the loads carried by their cars and trucks. House Bill 259, sponsored by Rep. Louise Stutes, R-Kodiak, advances to the Senate for consideration.
If approved there and signed by Gov. Bill Walker, it would increase the penalty for road debris from a citation to a misdemeanor. Stiffer penalties result if the debris injures someone or damages property.
Before the vote, Stutes said the bill was inspired by the story of an Anchorage woman who was critically injured after an unsecured garbage can flew from a truck bed into her windshield, causing a car accident.
Militia bill re-vote
Before concluding its Thursday floor session, the House rescinded last week’s failed vote on House Bill 152 and re-voted the measure. This time, it passed 23-14. HB 152, sponsored by House Majority Leader Chris Tuck, D-Anchorage, updates Alaska’s military code as it affects the Alaska state militia. It also allows the state adjutant general to call the militia into service in emergencies when the governor is not available. The bill advances to the Senate.
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