Sens. Shelley Hughes, R-Palmer, left, and Robert Myers, R-North Pole, read through one of 41 amendments submitted to the state’s omnibus budget bill being debate on the floor of the Alaska State Senate on Monday, May 9, 2022. (Peter Segall / Juneau Empire)

Sens. Shelley Hughes, R-Palmer, left, and Robert Myers, R-North Pole, read through one of 41 amendments submitted to the state’s omnibus budget bill being debate on the floor of the Alaska State Senate on Monday, May 9, 2022. (Peter Segall / Juneau Empire)

Senate goes big on PFD in budget debate

Large dividends and energy payments fill out budget

The Alaska State Senate spent all day in floor session Monday, working through 41 amendments to a budget bill for the state that lawmakers hope to have passed by the May 18 end of the legislative session.

The bill will eventually be negotiated in a bicameral committee, with the final product voted on by both chambers of the Legislature. On the floor Monday, Senate President Peter Micciche, R-Soldotna, told senators the bill was being engrossed, which allowed a version to be sent to the House for the purposes of tracking changes to the bill.

In a close 10-9 vote, Senators voted to pay a Permanent Fund Dividend based on the state’s existing statutory formula, about $4,300, something the state hasn’t done since 2016. However, that amendment was found to have a technical error and was tabled until Legislative Legal Services could fix the problem.

Voting in favor of the statutory dividend were Sens. Mia Costello, R-Anchorage; Roger Holland, R-Anchorage; Shelley Hughes, R-Palmer; Scott Kawasaki, D-Fairbanks; Robert Myers, R-North Pole; Donny Olson, D-Golovin; Lora Reinbold, R-Eagle River; Mike Shower, R-Wasilla; Bill Wielechowski, D-Anchorage; and David Wilson, R-Wasilla.

“As long as the formula’s in statute, I’m going to vote for it,” said Wielechowski, who sued the state in 2015 when it diverted from the formula for the first time.

Shower, who introduced the amendment, said he expected the amount to be rejected in negotiations with the House of Representatives, but his intention was to secure as large a dividend as possible by negotiating down from the statutory formula.

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Senators also passed an amendment from Wilson that diverted $840 million appropriated by the House to forward fund education for two years, and instead pay an energy relief check of $1,30o to each qualified Alaskan.

The plan is similar to one proposed by the House Majority Coalition, but the coalition included a smaller Permanent Fund Dividend of roughly $1,200. The Senate version of the bill eliminated the House’s energy relief check to instead pay a larger dividend. If the budget passes with Wilson’s amendment in place, eligible Alaskans will receive both the dividend and the $1,300 energy relief payment.

Senators rejected several amendments from Shower, including requests for $400 million for the completion of a rail extension into the Matanuska-Susitna Valley — Rep. Mike Cronk, R-Tok, and several other Republican House members attempted similar amendments in that body’s version of the bill — and transfers of more than $1 billion to the state’s Constitutional Budget Reserve.

Shower also proposed a series of amendments cutting funding for various state programs, including eliminating grants for research into Bristol Bay fisheries, Alaska Municipal League grants, and reducing funding for senior food stamps. Shower argued that much of the funding he was proposing to be cut will largely be covered by federal funding coming to the state.

All of those amendments were voted down by a majority of the Senate.

Several amendments from Costello were put forward for various capital improvement projects in her distict, but none passed.

Sen. Bert Stedman, R-Sitka, who co-chairs the Senate Finance Committee, said on the floor that with the amendment to pay an energy relief check and a large dividend, the state wouldn’t have enough money to pay for many of its services. Stedman said proposals to increase spending on the dividend were assuming a high price of oil, and could result in the state being unable to pay its bills if the price were to drop.

Senators also rejected an amendment from Sen. Robert Myers, R-North Pole, that would remove funds for Medicaid services that cover abortion. But several senators noted the state was legally required to cover those services.

Similar amendments are introduced every year, Wielechowski said, and every year they’re found to violate the state constitution.

“This amendment is clearly unconstitutional,” Wielechowski said. “We’ve seen similar bills, we’ve seen similar amendments, the (Alaska) Supreme Court has repeatedly struck them down.”

Senators were still working on the budget bill into the evening Monday, with additional bills on their calendar, including the state’s mental health budget and a bill banning transgender athletes from competing as the sex they identify with in school sports.

• Contact reporter Peter Segall at psegall@juneauempire.com. Follow him on Twitter at @SegallJnuEmpire.

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