After three years of walking the halls of the Capitol, unsuccessfully trying to pass the legislation necessary to resolve the state's fiscal crisis, I became disheartened by the inefficiency and intransigence of the legislative process. I resigned from my position as Commissioner of Revenue and went back home to live a more normal life, content with watching the process from afar. However, after watching the first two weeks of this year's session, I realized my blood pressure and my sanity required a more resolute decision. I penned an opinion piece expressing my frustration with the Legislature. Then I turned off Gavel-to-Gavel, stopped reading the ADN political section and quit listening to political talk radio.
I concluded that it takes a certain type of insanity to want to operate within a politically charged legislative process and I went back to living a life blissfully unaware of what was happening in the Juneau bubble. I have to admit that at first, there was some level of withdrawal distress, but I soon found I just didn't care anymore about who said what about whom and what excuses were
being used to defend not doing those things that would ultimately have to be done.
So I was shocked when, three weeks ago, a lobbyist approached me in the Anchorage airport and informed me that there was likely a deal in the works to pass Senate Bill 26. That chance encounter was quickly confirmed by a text from a friend in Juneau, who believed the legislation would pass within a week.
So when no one was watching, I turned on Gavel-to-Gavel, snuck a peek at the ADN political section, and even flipped the radio to the Dave Stieren show a time or two when driving to town.
I watched and listened intently as the legislation, which so many people from around the state had worked so hard to move, was debated and modified and simplified in order to garner enough support for passage. It took a little more than a week, but SB 26 passed, establishing a simple percent of market value (POMV) structure for the use of the permanent fund earnings.
Although the passage of SB 26 is likely to be the subject of political debate for quite some time, it is nonetheless a monumental achievement. I truly believe that years from now, it will be seen as one of the true successes of the Alaska legislative process. From my discussion with those who have studied the process around the world, it seems clear that most countries and states have struggled to adapt when their resource-based economies begin to decline. Instead of adjusting spending and finding a way to systematically use retained financial reserves for funding government services, many continued to spend beyond their means and continued to draw down their reserves at an unsustainable level.
During the past three years, Gov. Bill Walker and the Legislature have worked hard to reduce spending, cutting billions of dollars from the annual budget. With the passage of SB 26, they have now added a sustainable source of revenue to provide a baseline of support for critical government services.
The job isn't done, and there will be more difficult decisions to come. It's clear that $75 oil will likely delay difficult decisions on the need for additional revenue sources, and the $2.5 billion that remain in the Constitution Budget Reserve will, for a time, mask the need to find a permanent solution for balancing priorities between government spending and dividend payouts.
But those are fights for the future. For today, I congratulate the governor and his staff for taking the lead in passing a politically unpopular but absolutely necessary piece of legislation. And for those in the Legislature, I offer my apologies for saying you couldn't get it done. I was wrong, and I am glad that I was.
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