Linking Alaska’s Resources to Alaska’s People 50 2024 Meet Alaska Conference & Trade Show Work got off to fast start in January; adjournment in May The Legislature is near its halfway mark in its 2024 session toward a mandatory adjournment on the 120th day, which will be in mid-May. Things are busy, and work got off to a fast start almost from the beginning of the session in mid-January. Hot-button issues like education funding and a change of the pension system for public employees are in play, which is a good sign because there’s ample time until the session’s end for agreements to be worked out. Energy should be added to that list. Gov. Mike Dunleavy and lawmakers are looking for ways to encourage natural gas production in Cook Inlet, where production is set to decline. Major upgrades to the “Railbelt” (Southcentral-Interior) electric grid are planned with federal infrastructure money, although the Legislature must match this 50:50 with state funds, which will be a draw on the budget. Total funding for this will be about $810 million, combining a large federal grant with the state match. It is an approximately eight-year project. On education funding, legislators and the governor are in discussions over differing approaches by each body. The Senate has passed a bill that gives a boost to the Base Student Allocation, or BSA, the formula that guides state funding for schools. School districts argue that years of inflation have cut into the purchasing power of state funding. The state House rejected this approach and instead proposed changes to funding that targeted to problems like teacher retention but also boosting charter schools and correspondence home study. The House is also offering a BSA increase, but a small one. Gov. Dunleavy also supports targeted increases in education and has opposed a general increase in funding through the BSA. The negotiations will be between House and Senate leaders, but it is unknown what the governor will agree to, and he has a final veto authority over any House-Senate compromise bill. Public employee pension reform is another hot topic. Senate Bill 88, sponsored by Sen. Cathy Giessel, R-Anchorage, passed the Senate earlier this year and is being worked on in the House. It gives state, municipal and school workers the option of a “defined benefit,” or traditional pension, as well as the “defined contribution,” or 401k-type retirement savings plan now in place. The House reaction to the Senate bill has been cool. House Speaker Cathy Tilton, R-Wasilla, gave SB 88 assignments to three committees in the House, which often signals the death of a bill because of the time it takes to navigate three committees with all the pitfalls that can entail. However, the proposal is a priority for the Senate, which means it will also be included in the end-of-session negotiations. Despite the initial cold shoulder, House leaders have said they are open to discussion of pension legislation. Sen. Giessel said improvements to public pensions are needed so state agencies can slow employee turnover and retain veteran workers. Lawmakers also have their hands full with energy issues. Pending shortages of natural gas in Cook Inlet are of prime concern because gas fuels heating for homes and buildings in southcentral Alaska, as well of much of the power generated in the region. Rep. George Rauscher, R-Sutton, has a bill that would reduce the state royalty on gas production in the Cook Inlet basin. The governor has a similar bill pending. A reduction in royalty may be enough to spur new drilling and gas production in at least one smaller Cook Inlet gas field, gas producers have said. Another issue is possible legislation to induce regional utilities who own power transmission lines to lower their tariffs, or rates, for others sending power from one region to another. Lower costs of transmission through the “Railbelt” electric grid are needed to make planned large renewable energy projects economically viable. Legislative leaders, and the governor, have said that if a voluntary plan among the utilities cannot be reached the state may step in with a regulatory mechanism. — Tim Bradner Legislature: Education, energy on table in Juneau GIESSEL TILTON
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