A number of state budget issues remain unresolved and layoffs for state employees or even a shutdown are possible if the legislature and the governor can’t come to an agreement soon. Kenai representative Gary Knopp spoke with KDLL’s Shaylon Cochran about what a special session might look like to address those and this session’s thorniest issue, the permanent fund dividend.
Shaylon Cochran: The governor has proposed bringing the legislature together away from Juneau in the hopes of, I guess forcing some resolution to this budget mess. How do you think that will play out?
Gary Knopp: I think you might see a special session on the road system, but I think you won’t see it until late August when we come back to debate a PFD amount and a PFD formula change for calculating the PFD. That’s what I expect. I think the Senate is finally going to agree to withdraw the PFD amount from this year’s operating budget and I think we’re going to pass a budget. Now, what the governor will do, I have no idea. But the House has stood pretty firm. We sent over a budget without a PFD amount in it because we recognized early on we have to figure out a new formula and what we’re going to do with the debate and the size of this thing every year. That’s one of the reasons we sent that over. And the House has only agreed to spend what we have available and not rob from savings. The Senate, they fully funded a PFD because it was the only way they could get a budget back to us. They’re pretty divided on the PFD so they compromised, put the full PFD in so they could get the votes and move the budget bill out of that body, knowing good and well it would end up in conference and that’s where it would be addressed. I think they’re getting close to agreeing with us that it needs to come out and move forward in a separate appropriations bill, but it’s going to be a pretty lengthy discussion on that PFD because we’re kind of all over the map on that.
SC: This has been such a topic this legislative session is what the PFD ought to be and how do you continue funding that. Are you hearing the same thing from folks now that you were back in January or has the conversation shifted a little bit? Are people thinking a little differently about the PFD than they were five months ago?
GK: I’ll tell you what shifted the conversation is the governor’s proposed budget. When he rolled that out, that shifted the conversation. When we took our finance team out to the communities to talk about the impacts, what we heard time and time again is the fact that we would like a dividend, but not a full dividend. We’re willing to give up part of our dividends to afford some of these essential services. And it’s interesting, when we talk to the governor’s office or the governor’s office comments on this, and they say we’re talking to two different constituencies because that’s not what we’re hearing. I imagine he’s hearing from the ones who are fully behind him when he advocated for a full dividend but that’s not what we’re hearing from the bulk of our people and the public testimony reflects that.
SC: One thing the governor has said he wanted to do, and I think he’s accomplished this, is to get a deeper discussion going about the PFD and the budget and if nothing else, I think he’s certainly accomplished that this year.
GK: He’s got a discussion going, but he’s also (caused) a lot of uncertainty and a lot of harm in our economy and in our school districts. And I’m not going to say he’s all wrong. I think he’s wrong in his approach to it. I don’t disagree with him. I think a lot of what he’s trying to do can be accomplished, but just not with this method.
SC: I know that folks are worried about the governor’s veto authority, what would you say to folks who are thinking no matter what the house and the senate approve, there’s still that veto lingering over the budget?
GK: I still worry about it every day. And I tell my colleagues in Juneau look, we’ll put forward the best budget we can; one that’s real and doesn’t spend more than we have and doesn’t rob from savings and we coalesced around some of this; fiscal responsibility, a sustainable budget. We said we’re not going to talk about new revenue measures if the governor’s not going to hear them, we’re not going to spend our time on them. We’re going to address the PFD, crime reform and the budget. That’s what our coalition was formed around and we did exactly that. The house passed out a budget, we passed a crime reform bill and our plan all along was to address the PFD in a separate appropriations bill. The house did its job. We sent it to the senate and they’ve had some trouble getting concurrence to get it back. But the house figured it out. Now the senate will figure it out and we’ll come together and get a final product and I think we’re going to see that happen in the next week. I really do.
I hope people will stay optimistic. I tell people, don’t get too worked up. At the end of the day, it’s all up to (the governor) with that veto. When the vetoes come, hypothetically, if he slashes $350 million from education, I know that our body would override them. I don’t know that the senate or the House Minority would help us do that. So that’s where the issue is going to lie, we have to wait and see what he decides to ultimately do and then the legislature will have to decide if they can pull together to do what they think is right or let the governor’s vetoes stand.