The Alaska Legislature is continuing to grapple with state budget issues in a special session still clouded by the contentious oil tax debate even though that's clearly off the table at this point.
Gov. Sean Parnell sent a letter Tuesday morning to legislative leaders blaming the Senate for what he characterized as a "pileup on the legislative tracks."
Parnell has consistently sided with the House in the political standoff that led to an unprecedented and abrupt end to the regular session late Sunday night. The letter urges the Senate to pass the capital budget to the House so "the public process can be completed in a way that assures integrity and opportunity for all."
Parnell notes -- although without the same criticism -- that the House has yet to finalize the operating budget and pass it to the Senate. His letter describes a sort of legislative checkmate in which the House traditionally draws up the operating budget, the Senate drafts the capital budget, they exchange initial plans but then each side continues to hold the final budget until the last minute as leverage during negotiations.
What's gone wrong this year is that negotiations have stalled, many believe because Parnell threatened to veto capital projects sought by certain senators who were not going along with his proposal to cut taxes on the oil industry.
The veto threat prompted Senate budget writers to include contingency language in the capital budget that protects about $465 million of energy projects by stating that if Parnell vetoes one project on the list, the whole list is eliminated. Several projects sought by the governor, including his signature Susitna Dam hydro project, would be lost.
Although House and Senate leaders have been meeting with each other and the governor and his staff since the special session began Monday afternoon, little progress has been made. A couple of bills Parnell included on the special session agenda were quickly resolved but the budget issues appear little closer to resolution.
Sen. Bert Stedman, co-chair of the Senate Finance Committee, said the governor's letter didn’t help matters and, in fact, probably made things worse.
"I think firing off letters like that is like throwing a bomb down the chimney," Stedman said. "That's not the way to get things moving forward."
Stedman said he was surprised to get the letter Tuesday because it seemed at odds with what the governor had laid out Sunday night as the path forward. The finance committee was expecting the governor's staff to go through the list of energy projects and identify those that Parnell was opposed to. Stedman said he had met with Parnell budget director Karen Rehfeld Monday and that was the plan.
"I told her and the governor today we're not hiding any peanuts," Stedman said.
At this point, he said, the Senate doesn't intend to change the contingency language. "The Senate, as far as I know, likes that language. Until I hear different, I have no intention of pulling it out."
Rep. Les Gara, a member of the House negotiating committee on the operating budget, also criticized the governor's letter during a brief speech on the House floor Tuesday.
"We're at the point where we're all trying to find a solution and this letter, two days into the special session, is a letter that is full of blame," he told his colleagues. "I don’t think that's useful at this point."
Gara characterized the governor's initial veto threat as "unfortunate."
"We could move ahead by leaps and bounds if the governor were to make clear that veto threat doesn't exist and he will not look particularly at those who don't support his oil tax legislation," Gara said.
Meanwhile, the Legislature has approved and passed on to the governor two bills that were included in the special session. One is Senate Bill 84, which provided educational funding and in particular dealt with vocational education programs. The other, House Bill 126, extended the lives of several state boards and commissions including the Alcoholic Beverage Control Board.
On Tuesday, the Senate Finance Committee made some changes in Senate Bill 42, which would allow the Alaska Energy Authority to own and operate the proposed Susitna River hydroelectric project, also being called the Watana dam project because of its location on the river.
That bill was expected to be voted on by the full Senate on Tuesday afternoon and it would then go to the House, which has already thoroughly vetted the bulk of the measure.
Other issues still on the table include the coastal management program, Parnell's proposal for merit scholarships, the extension of the Regulatory Commission of Alaska and the four budget bills.
The Legislature is required to pass an operating budget before it adjourns and the governor also has asked for approval of more than $100 million in a supplemental budget that agencies need to pay their bills through June.
He did not know whether that money would be put in the operating or the capital budget.
"Either way we're not going to leave the state of Alaska exposed financially by not having a supplemental budget done in the Senate," Stedman said.
As to when the Legislature might wrap up, Stedman wasn't too sure, saying, "I thought we were going forward but I don’t know if we're not going backwards."
He also cracked up listeners with this slip: "I'm hopeful to be out of here by Thanksgiving. Oh, not Thanksgiving, by Easter."
Contact Patti Epler at patti(at)alaskadispatch.com