When it comes to fixing Alaska’s $2.8 billion deficit, nothing is written in stone.
Not even a bill that both the Alaska House and Senate have passed.
One day after the Alaska House of Representatives voted 22-18 to divert some of the earnings of the Alaska Permanent Fund toward the deficit, members of the Senate Majority said they expect negotiations to resolve differences between the bill passed by the House and another version passed 12-8 by the Senate earlier this year.
“The House has their version, the Senate has ours, and I think the next step is to send that to a conference committee to work out the differences,” said Sen. Lyman Hoffman, D-Bethel and co-chairman of the Senate Finance Committee.
The House and Senate each agree that Senate Bill 26 is the keystone of any deal to resolve Alaska’s deficit this year. They disagree on the shape of that keystone and how it connects to other pieces of the overarching solution.
The House’s version of the bill keeps the Permanent Fund Dividend at $1,250. The Senate’s version cuts that to $1,000.
The Senate’s version restricts spending by future legislatures. The House version has fewer restrictions.
The House’s version of SB 26 requires legislators to cut the state’s subsidy of oil drilling and enact a “broad-based tax,” code words this year for an income tax.
“The bottom line is we don’t need an income tax,” said Sen. Anna MacKinnon, R-Anchorage and co-chairwoman of the Senate Finance Committee.
“The Senate has serious concerns, I would say, regarding the income tax, and the differences, I think, are ones that can be worked out at a conference table,” Hoffman said.
In the remaining month of the Legislature’s regular session, that conference table may become a crowded political battlefield.
The House has said it wants all four “pillars” of its budget fix on the table at the same time. That would allow negotiators to trade pieces among all four.
The pillars include the budget, an income tax, cuts to oil and gas subsidies, and Senate Bill 26.
The House has yet to forward an income tax to the Senate, while the budget and SB 26 are ready for conference. The bill containing cuts to oil and gas subsidies is in Senate committees this weekend.
Contact reporter James Brooks at james.k.brooks@juneauempire.com or call 419-7732.
