Capitol Report 2017

June 12^th 2017

The Capitol Report

By Miles Baker

Associate Vice President Government Relations

Good afternoon from Juneau.

Today is the 26^th day of the 30 day special session and there now seems to be progress being made between the House and the Senate to resolve their differences. The Legislature has until midnight Friday to conclude business or another special session will have to be called.

On May 17^th, having been unable to resolve business by either the 90 day statutory deadline or the 120 day deadline in the Alaska Constitution, the Legislature was immediately called back into special session by Governor Walker. The governor limited the Legislature’s business to the following topics:

• Opioid prescription controls (HB 159)
• Operating budget (HB 57/HB 59)
• Capital budget (SB 23)
• Permanent Fund restructuring (SB 26)
• Oil & gas tax reforms (HB 111)
• Motor fuel tax (HB 60/SB 25)
• Broad-based tax

On June 5^th, after two weeks of no visible progress on anything other than the opioid crisis legislation, the governor proposed a compromise fiscal package to help resolve the legislative stalemate. He held a press availability to answer questions about the compromise package the following day. The proposal was quickly dismissed by the House Majority Coalition and the Senate Majority soon followed with their own set of questions about the plan.

At that point, things were really not looking good. However, over the last several days there has been significant movement on the operating and capital budgets, which are the only pieces of legislation that must pass in order to ensure state government is funded for the next fiscal year that begins July 1^st. Because the Legislature is operating under the 24-hour rule, hearings only have to be publicly noticed by 4:00 p.m. the day prior, so once agreements are reached, the process can move relatively quickly.

Operating Budget:

The operating budget conference committee has met three times, including this past Saturday, and they have agreed upon several state agency budgets. This is the committee responsible for deciding the final unrestricted general funding (UGF) level for the University of Alaska. The governor and the House have endorsed $325 million while the Senate proposes $303 million, a $22 million UGF cut over the current year.

As we expected, the committee is delaying decisions about education funding and the university’s budget until other issues are resolved. Many of those decisions have been made and at Saturday’s hearing the committee took up the two language items the House had proposed for the university’s budget.

• The first language item expressed the House’s intent that the university reduce the number of intercollegiate athletic teams to the minimum required by the NCAA. The committee chose not to adopt that language.
• The second language item expressed the House’s intent that any general fund budget reductions or reallocations at the three universities not exceed the percentage of reductions made at Statewide administration. This language was adopted by the committee.

Lastly, the committee included language for the recently concluded collective bargaining agreements for the Alaska Higher Education Crafts and Trades Employees, Local 6070, Fairbanks Firefighters Union, IAFF Local 1324 and United Academic – Adjuncts. Language for the University of Alaska Federation of Teachers had already been included in the budget.

You can view the conference committee motion sheets here. You can watch 360 North’s broadcast of Saturday’s conference committee here.

It’s not too late to weigh in with legislators to tell them what the University of Alaska means to you and why maintaining an appropriate level of state funding is so important. The university has developed a digital postcard campaign to bring more attention to the critical legislative budget decision. We encourage you to lend your voice to this effort and to communicate the reasons you support funding the university at the $325 million level. You can access the campaign here. Share your e-cards on social media using the hashtags #SupportUA and #AKleg to broaden the impact of your advocacy.

Capital Budget:

The House Finance Committee released a new version of the FY18 capital budget (SB 23) on Saturday morning and passed it out of committee Sunday afternoon. I expect the full House to vote on the bill tomorrow morning. This is a very encouraging sign that a final session adjournment agreement is in the works. The bill includes $5 million for university deferred maintenance. You can watch 360 North’s broadcast of the Sunday’s final capital budget hearing here.

Broad-Based Tax:

It’s still unclear if a broad-based tax is going to be part of the final solution. It is looking less likely. Today the House Finance Committee did have a hearing on the topic, but it appears to be increasingly unlikely it will become part of the final adjournment package. You can watch 360 North’s broadcast of this afternoon’s hearing here.

Permanent Fund Restructuring:

No progress since my last update on SB 26,the bill that would allow a portion of Permanent Fund earnings to be used to fund government. It’s now unclear whether that will be resolved this legislative session.

Motor Fuel Tax:

No progress has been made on this topic since my last update. Neither bills have made it past their first committees of referral. It’s looking unlikely that this will be part of the final adjournment package.

Oil Tax Reform:

The conference committee responsible for working out the differences over HB 111 held one organizational meeting on June 9^th. You can watch 360 North’s coverage of that meeting here.

Thank you for your continued support of the University of Alaska. For more information, contact Miles Baker at miles.baker@alaska.edu or visit www.alaska.edu/state.

May 16^th, 2017

The Capitol Report

By Miles Baker

Associate Vice President Government Relations

Today is the 120^th day of the legislative session. While there have been some procedural movements since my last update, not much has been resolved in the four primary areas that need agreement before the Legislature can adjourn: the operating budget, a broad-based tax, oil tax reform and Permanent Fund restructuring.

As of this writing, it’s still unclear how and when things will wrap up here in Juneau. All observers agree that work won’t be finished by tomorrow’s 121-day regular session deadline. But there isn’t real consensus on what comes next.

The Alaska Constitution provides the Legislature with up to a 10 consecutive day extension with the agreement of two-thirds of each chamber. That means 14 of 20 Senate members and 27 of 40 House members must all agree to extend. That threshold could prove easier for the Senate, where the current majority numbers 14, but the House Majority Caucus is 22 members, 5 short of the number needed. So at least a portion of the House Republican Minority will be needed to pass a 10-day extension in that chamber. Alternatively, with the support of two-thirds of the entire Legislature (40 of 60), they could simply adjourn the regular session and call themselves back into a 30-day special session. Finally, the Governor could call the Legislature into a 30-day special session and he has the ability to limit the subjects that will be covered.

Today at 1:00pm the Legislature will meet in joint session to vote on the confirmation of the Governor’s cabinet nominees and other appointees to state boards and commissions. University Regents Mary Hughes and Karen Perdue will both be up for confirmation votes today. Regent Hughes was reappointed on February 6th by Governor Walker to serve a third term on the Board of Regents. Regent Perdue was appointed on February 6th to her first term on the board. Good luck to both of these excellent leaders.

Operating Budget:

On Saturday, April 29^th more than 70 Alaskans took the time to testify in support of the university’s budget before the House Finance Subcommittee. The subcommittee heard four straight hours of testimony from all over the state and ended up extending the hearing an extra half hour to accommodate everyone that wanted to testify. I would like to personally thank everyone involved in spreading the word and to all who called-in, showed up and told their story. You can watch 360 North’s broadcast of the public testimony here.

The FY18 operating budget conference committee held its first organizational meeting yesterday afternoon. The six conference members are Representative Seaton from Homer, who will serve as chairman, Senator Hoffman from Bethel, who will serve as vice-chairman, Senator MacKinnon of Eagle River, Representative Foster from Nome, Senator Olson from Golovin and Representative Pruitt from Anchorage. The conference committee will be responsible for deciding the final unrestricted general funding level for the University of Alaska. The Governor and the House have endorsed $325 million while the Senate proposes $303 million, a $22 million UGF cut over the current year. You can watch 360 North’s broadcast of yesterday’s largely organizational first meeting of the committee here.

Your personal involvement can make a difference over the next several weeks. You still have an opportunity to tell legislators what the University of Alaska means to you and why maintaining an appropriate level of state funding is so important. The university has developed a digital postcard campaign to bring more attention to the critical legislative budget decision. We encourage you to lend your voice to this effort and to communicate the reasons you support funding the university at the $325 million level. You can access the campaign here. Share your e-cards on social media using the hashtags #SupportUA and #AKleg to broaden the impact of your advocacy.

Now that the operating budget conference committee has been formed, the Legislature is operating under the 24-hour rule. Legislative hearings now have to be publicly noticed just 24-hours in advance. In practice, this means hearings must be noticed by 4:00pm the day prior, even if they are scheduled to begin early in the morning. Although this rule helps speed up the process, it also means staying on one’s toes as things can change very rapidly.

Capital Budget:

On May 9^th, the Senate Finance Committee released a committee substitute for SB 23, the FY18 capital budget. In a bit of good news, the bill included an addition of $5 million for deferred maintenance at the university. Historically, the university relies on annual capital appropriations to address our facilities maintenance backlog which now exceeds $1 billion. On May 12^th the Senate passed their bill and the House Finance Committee held its first public hearing last Saturday. You can see a breakdown of the projects included in the $1.4 billion capital budget here. The House Finance Committee will now review the Senate’s legislation and make modifications. Expect this budget to be one of the last pieces of legislation that moves through the process this year.

Broad Based Tax:

On Friday, the Senate voted down HB 115, the House’s income tax bill, on a 4-15 vote. Because the House and the Governor have indicated that a broad based tax must be a component of this year’s fiscal plan, it’s unclear where the Legislature goes from here. There isn’t another legislative vehicle under consideration capable of raising the $700 million in tax revenue this bill was estimated to generate. You can watch 360 North’s broadcast of the Senate’s income tax floor debate here. You can watch the Senate Majority’s post vote press availability here.

Oil Tax Reform:

The Senate spent much of yesterday afternoon debating HB 111 before passing the bill on a 14-5 vote. The Senate’s version will now be sent back to the House for consideration. There are major differences between the two bills that will more than likely take a conference committee to resolve and is one of the primary reasons the session will have to be extended. You can watch 360 North’s coverage of today’s Senate floor debate and vote here.

Permanent Fund Restructuring:

As discussed in my last update, the House and the Senate have agreed in principle to spend a portion of Permanent Fund earnings to fund government. SB 26 is the vehicle that will be used to resolve these differences. The primary disagreements are on the size of the draw and the size of the dividend over the next few years. However, the House conditioned their agreement on some type of broad-based tax becoming law this session. Friday’s action by the Senate rejecting the House’s income tax bill complicates negotiations on a Permanent Fund deal. A conference committee has been appointed and the first organizational meeting was held on May 9^th. You can watch 360 North’s broadcast of that first conference committee meeting here.

Other Legislation of Interest to the University:

On May 10^th, the House agreed to concur with the Senate’s changes to HB 141 by a vote of 39 to 1. HB 141 extends the Technical Vocational Education Program (TVEP) for three years through 2020. The House had originally proposed a five-year extension, but the final compromise extends the program for three years. The bill is now waiting to be transmitted to the Governor for signature.

Thank you for your continued support of the University of Alaska. For more information, contact Miles Baker at miles.baker@alaska.edu or visit www.alaska.edu/state.

April 27^th, 2017

The Capitol Report

By Miles Baker

Associate Vice President Government Relations

Today is the 101^st day of the legislative session. Some updated stats for you: since the 30^th Alaska Legislature began, 358 bills have been introduced, 15 have passed and 3 have been signed by the governor.

Despite what those numbers suggest, a bit of progress is actually being made on the biggest policy issues the legislature is grappling with. Nothing motivates quite like a string of nice sunny days and spring flowers blooming just outside your capitol office window.

The primary issues that must be resolved before adjournment: the operating budget, oil tax reform, permanent fund restructuring, and a broad-based tax. A few other things will also need to be resolved - the FY18 capital budget and legislative consideration of the Governor’s cabinet and board appointees – but the ice-jams are in those four major areas. Let’s look at where we are on each.

Operating Budget

Not much happening publicly, but behind the scenes negotiations are well under way. The Senate’s FY18 state operating budget is about $280 million below this year’s spending level. $22 million of that cut is coming out of the university. The conference committee hasn’t been named and most likely won’t be until bigger fiscal policy differences get more resolution. Keep in mind that once the conference committee is formed, the 24-Hour Rule is invocated. Under the 24-Hour Rule, legislative hearings only have to be publicly noticed 24-hours in advance as opposed to the normal 5-day requirement. While the rule helps speed things up in the final days of session, it makes it difficult for the public to keep up with the process. The legislature is mindful of that, and so they are cautious of initiating the conference committee process before they have a good sense of how the final session components will come together.

With regard to the university’s budget, there is a new development that we could use your help with. The House Finance Budget Subcommittee on the University of Alaska’s budget has announced that it will take public testimony on our budget this Saturday, April 29^th beginning at 1:00 p.m. The timing of this hearing is a bit unorthodox as its coming after both bodies have voted on our budget and before a conference committee is convened. Nevertheless, its a great opportunity to tell our story. We encourage you to make time to testify on what the University of Alaska means to you and why maintaining our funding is important. The Governor and the House have endorsed a $325 million funding level while the Senate is proposing $303 million, a $22 million cut over the current year. If the Senate number holds, it will represent a cumulative $75 million or 20% cut to the university in just the last four years. If you happen to be in Juneau Saturday, testifying in person is an excellent option. Everyone else is encouraged to go to their local Legislative Information Office, but if that isn’t possible, you can also testify by phone at (844) 586-9085.

Hearing Details:

House Finance Budget Subcommittee on the University of Alaska

Rep David Guttenberg, Chairman

Saturday, April 29^th

1:00 – 4:30 p.m.

Capitol Building, Room 519

Juneau, Alaska

Don’t forget that the university has also developed a digital postcard campaign to bring more attention to the critical budget decision legislators face. You can access the campaign here. Share your e-cards on social media using the hashtags #SupportUA and #AKleg to broaden the impact of your advocacy.

Oil Tax Reform

Some progress is being made here. The Senate has moved quickly on the House’s oil and gas tax legislation, HB 111. The House passed the bill on April 11^th, and the Senate kicked off their review soon after, holding a joint Resource and Finance Committee hearing on Saturday April 15. The Senate Resources Committee spent all of last week discussing the bill and on Monday moved out a substitute. Not unexpectedly, the Resources substitute bill ends the refundable or “cashable” oil and gas tax credits and transitions the current net operating loss credit to the more traditional method of carrying forward and expensing to recover costs. You can access a summary of the changes here. To listen to Monday’s discussion of the substitute bill or access other committee materials click here. Alternatively, you can watch 360 North’s broadcast of the hearing here. The bill is now in the Senate Finance Committee. Public testimony is scheduled for Saturday, April 29^th at 9:00 a.m. and my expectation is that the committee moves some version of oil tax legislation early next week.

Permanent Fund Restructuring

As discussed last week, the House and the Senate have already agreed in principle to spend a portion of Permanent Fund earnings on government services. The primary disagreements are on the size of the draw and the size of the dividend over the next few years. SB 26 is the vehicle that will be used to resolve these differences. The House inserted language making the bill’s passage contingent on both HB 111 (see discussion above) and some form of broad-based tax becoming law this session. While these contingencies complicate things, the Senate’s movement this week on HB 111 is encouraging. The broad-based tax remains the most difficult component of any future negotiations. Yesterday three members from each body were appointed to a Conference Committee to work out the differences. Senator MacKinnon will chair the Senate side with Senator Hoffman and Egan, and Representative Foster will chair the House side with Representative Seaton and Thompson. An organizing meeting originally scheduled for 1:00 p.m. today was cancelled.

Broad-Based Tax

The House passed HB 115, their income tax bill on April 16th. While the Senate continues to be adamantly opposed to an income tax, they have agreed to hear the bill. The Senate Labor & Commerce Committee held an initial hearing Tuesday morning, and a number of other hearings this week. You can listen to the preliminary hearing and access other committee materials click here. Alternatively, you can watch 360 North’s broadcast of the hearing here. Based on the Senate’s early reaction, I see no softening of their opposition to an income tax. Tomorrow morning at 9:00 a.m. the Senate Finance Committee will be giving a presentation on the Senate Majority caucus’s non-income tax based fiscal solution.

Senate Cuts University Scholarships

Yesterday, the Senate passed SB 103 on a 13-7 vote. Senators Click Bishop and Bert Stedman joined the five-member minority caucus in voting against the measure. SB 103 eliminates the financial needs based Alaska Education Grant (AEG) and cuts funding for the highly successful Alaska Performance Scholarship (APS) program by 50%. The legislature created the APS in 2011 to inspire Alaskan high school students to better prepare themselves for college and to enroll here in Alaska. In the 2015-2016 academic year, 4,648 UA students benefited from one of these two programs. The bill the Senate passed yesterday eliminates Tier 2 and 3 of the Alaska Performance Scholarship and eliminates AEG all together. If the bill makes it through the entire process, 50% of the high school graduates who are currently eligible for APS will no longer be. That leaves about 1,200 students annually who will no longer qualify beginning next year. To be eligible, high school graduates will have to have 3.5 grade point average or better and at least a 25 on the ACT or a 1210 on the SAT.

The university is very concerned about changes to these highly successful programs and believes they will be detrimental to growing our enrollment and to our goal of educating Alaskans in state and ultimately having them build careers here. Cutting the number of APS eligible students in half and completely eliminating the needs based AEG grant will impact the university’s tuition revenue by as much as $8 million annually. The Board of Regents and the Coalition of Student Leaders passed resolutions opposing changes to the Alaska Performance Scholarship or the Alaska Education Grant and those resolutions were provided to legislators. You can review the estimated revenue impacts to the university’s fiscal note. You can watch 360 North’s broadcast of the Senate floor debate on SB 103 here. We will now carry the fight to the House side.

Education Tax Credit

On April 19^th, Senator Coghill introduced SB 116 which would extend all existing Education Tax Credit (ETC) provisions through 2025. Representative Tuck had previously introduced HB 233 to accomplish the same thing. The ETC was established to encourage private businesses to make charitable contributions to Alaska educational institutions. For a contribution made to UA to be eligible for the tax credit, the money must be used for direct instruction, research, education support, UA Foundation, facilities or intercollegiate sports. In 2015, UA received approximately $5.2 million in corporate donations. The credit is scheduled to expire in December 2018. While we don’t expect either bill to be heard this year, we will be working with both sponsors over the interim to raise awareness of the credit’s importance to the university.

Thank you for your continued support of the University of Alaska. For more information, contact Miles Baker at miles.baker@alaska.edu or visit www.alaska.edu/state.

 

April 18^th, 2017

The Capitol Report

By Miles Baker

Associate Vice President Government Relations

Easter Sunday marked the 90^th day of the session and the statutory deadline by which the legislature is supposed to conclude its business. It’s been clear for weeks that they weren’t going to hit that goal, and yesterday we officially entered overtime.

The Alaska Constitution established the length of the regular session as “one hundred twenty days from the date it convenes.” That clock began ticking on January 17^th when the legislature gaveled in. The 120^th day takes us to May 17^th, at which point the legislature has to take formal action to extend further into a special session. Several years ago, a public initiative established a 90-day legislative limit in statute, but legislators have found it difficult to finish in that amount of time and aren’t legally bound to do so given the greater constitutional limit.

So will the next 30 days be different than the first 90? Let’s hope so. One big difference is that most of the major pieces of policy legislation have been passed from one body to the other, so from a procedural perspective, both are technically in a position to begin the process of negotiating on the differences in legislation. The Senate has announced that it will be shutting down all committees except for Resources and Finance in order to focus on budget and revenue bills.

Last Wednesday Senate President Kelly communicated the Senate’s session priorities in a letter to House Speaker Edgmon. End game negotiations will take a number of forms, but much of it won’t be done in public. Conference committees will be appointed with representatives from the House and Senate in order to work out the differences within bills passed by each house. While these conferees are responsible for structuring the formal legislative agreement, policy decisions will be made through a form of shuttle diplomacy in a series of discussions between leadership teams and both majority and minority caucuses in an effort to reach a policy consensus that at least a majority of members from both bodies can support.

Everything centers on developing a complete fiscal package – a combination of spending and revenue that can garner enough legislative support to pass. On the spending side, the Senate wants to fund the FY18 operating budget at about $4.1 billion, about $280 million below the House’s level. Currently $22 million of that reduction comes from the university’s budget.

On the revenue side, both bodies have agreed in principle to spend a portion of Permanent Fund earnings to help fill the $3 billion FY18 budget gap. They disagree on exactly how much should be used and at what level dividends should be protected over the next several years, but for the first time ever, both bodies have passed legislation (SB 26) that would make a portion of earnings available to fund government. Regardless of where you stand personally, this represents a major legislative milestone. So what’s the sticking point? Taxes.

The House supports an income tax and modifications to Alaska’s oil and gas tax regime. Although the Senate has shown a slight willingness to consider scaling back cashable oil tax credits and Net Operating Loss deductions, they remain unequivocally opposed to an income tax. These are complicated and controversial policy issues that the House has sent to the Senate just in the last week. With the official game clock in overtime, it’s not clear that either subject can get a full and proper vetting.

University Budget Update

On April 6^th the Senate held an extended floor debate on the FY18 operating budget (HB 57/HB 59) and considered more than 21 amendments. Senator Gardner offered amendment #14 which would have restored the $22 million, or 7 percent cut the Senate Finance Committee proposed to the university’s operating budget. Senator Wielechowski spoke in support of Senator Gardner’s amendment before it failed 5 -15 along party lines. 360 North’s coverage of the floor debate on the university budget amendment is in the last part of this clip and the beginning of this one. Currently, our budget stands at $325 million in the House and the Senate is at $303 million. If the Senate number holds during the conference committee negotiations, it represents a cumulative $75 million, 20 percent cut in the last four years. The next step is the appointment of a conference committee, which has been delayed until some of the larger fiscal differences between the two bodies are resolved. You can compare the House and Senate versions of the university’s budget here.

The Board of Regents held a special meeting last Thursday, April 13^th to discuss the impacts this drastic budget cut will have on the university. You can access the Board of Regents contingency planning materials here.

The university has developed an advocacy campaign to bring attention to the critical decision legislators face on our budget. We encourage you to lend your voice to this effort and to communicate to the legislature the reasons you support funding the university’s budget at the $325 million level endorsed by the Governor and the House. You can access the campaign here. Share your e-cards on social media using the hashtags #SupportUA and #AKleg to raise awareness of this crucial decision affecting the University of Alaska.

Higher Education Scholarships in Jeopardy

On Monday April 10^th, the Senate Finance Committee held its first hearing on SB 103 and took public testimony. SB 103 would eliminate the need-based Alaska Education Grant (AEG) and drastically reduce the highly successful Alaska Performance Scholarship (APS) program over the next four years. The legislation replaces the APS program with a competitively awarded “innovation” grant program for school districts. The legislature created the APS in 2011 to inspire our state’s high school students to prepare for and succeed in post-secondary education. It was designed to help reduce the number of high school graduates leaving Alaska to attend college. In the 2015-2016 academic year, 4,648 UA students benefited from one of these programs, bringing $14.8 million in tuition revenue to the university. UA supports the continuation of the Alaska Higher Education Investment Fund which finances both programs and opposes the portions of SB 103 that would eliminate the AEG and substantially reduce the APS. During the hearing Saichi Oba, UA’s Associate Vice President for Student and Enrollment Strategy and Joe Nelson, UAS’s Vice Chancellor of Enrollment Management and Student Affairs both testified in opposition to the bill. You can listen to the hearing and access committee materials here. Alternatively, you can watch 360 North’s broadcast of the hearing here. The Board of Regents passed a resolution opposing SB 103 at its April 13^th meeting which Chair O’Neill has transmitted to Senate and House leadership.

On Friday, April 14^th, the Senate Finance Committee passed out a revised version of SB 103, which completely eliminates the Alaska Education Grant and phases out Tier 2 and 3 of the Alaska Performance Scholarship by February 1, 2021. Only Tier 1 scholarships will remain, which are available to high school graduates with a 3.5 grade point average or better and at least a 25 on the ACT or a 1210 on the SAT. While the new substitute bill is less damaging to the university than the original version, UA estimates the university could lose $4-5 million annually due to the elimination of 60 percent of existing APS scholarships and approximately $4.1 million through the elimination of the AEG, for a combined $8-9 million in potential revenue impact from lost tuition. You can review the estimated revenue impacts in the university’s fiscal note. You can listen to that final committee hearing and access committee materials here. Alternatively, you can watch 360 North’s broadcast of the hearing here.

A Little Bit of Positive News

On Friday April 14^th at 1:30 p.m. the Senate Finance Committee approved a revised version of HB 141, which will extend the Technical Vocational Education Program (TVEP) for three years through 2020. The House had passed the bill with a five-year extension, the Senate Labor & Commerce Committee recommended just a one-year extension, and after some final negotiations between the sponsor Representative Fansler, the Department of Labor, the university and members of both Senate committees a decision was made to settle on a three-year program extension. This gives program recipients, including the university, adequate time to plan and manage the delivery of training, but also ensures that the overall program undergoes a top down review before it will be extended beyond 2020. You can listen to last week’s hearing and access committee materials here. Yesterday, the Senate passed the bill and it is on its way back to the House for concurrence.

On April 15^th, Representative Tuck introduced HB 233 that would extend all existing Education Tax Credit (ETC) provisions through 2025. In addition to reauthorizing TVEP, one of the university’s other legislative priorities is obtaining an extension of the ETC, which is scheduled to expire in December 2018. The ETC was established to encourage private businesses to make charitable contributions to Alaska educational institutions. For a contribution made to UA to be eligible for the tax credit, the money must be used for direct instruction, research, education support, UA Foundation, facilities or intercollegiate sports. In 2015, UA received approximately $5.2 million in corporate donations. Representative Drummond, the House Education Committee chair, has indicated that she will introduce a similar bill and I expect Senator Coghill to introduce a Senate companion in the next several days.

Bills to Watch

Here are the key pieces of legislation to watch as the legislature negotiates toward adjournment:

SB 26 – authorizes an annual draw on Permanent Fund earnings reserve to fund government; passed by both bodies but major differences exist between the two versions. Slight differences in mechanics of draw and amount of annual dividend. The Senate version includes a provision to limit annual general fund appropriations to $4.1 billion annually adjusted for inflation. The primary sticking point is the House version includes language that makes the bill’s passage contingent on both HB 111, the House’s oil and gas tax bill, and a broad based tax generating at least $650 million annually becoming law. While the bill doesn’t specifically mention the House’s income tax bill, HB 115, that’s clearly the vehicle the House favors in the contingency. A conference committee has yet to be appointed, and is likely to happen this week.

HB 111 – oil and gas production taxes. Passed the House last Tuesday, April 11^th and Senate Resource and Finance committee hearings began on Friday. Hearings are scheduled through Friday of this week.

HB 115 – income tax. Passed the House Sunday, April 16^th. Imposes a tax on income of individuals, partners, shareholders in S corporations, trusts and estates beginning in 2019 based on your federal adjusted gross income. Estimated to raise $687 million annually when fully implemented including $80 million from nonresident workers. It’s been referred to the Senate Labor & Commerce committee but is unlikely to get a hearing. This does not, however, mean the concept may not resurface as part of end-game negotiations.

HB 57/59 – state operating and mental health budgets for FY2018. A conference committee hasn’t been appointed to work out the differences. While the budget is technically the only thing the legislature needs to approve, this year it isn’t going to be concluded until the other components of a fiscal plan are agreed upon.

SB 23 – state capital budget for FY2018. Given the state’s fiscal situation, this year’s capital budget isn’t expected to be large, but as the final appropriation bill expected to move through the process, it’s always one to keep your eyes on. On Tuesday, April 11^th, the Senate Finance Committee held its first hearing on the bill and took public testimony. To help raise awareness of the university’s serious deferred maintenance challenges, I testified for the university at Tuesday’s hearing. The University of Alaska (UA) is the largest landlord in Alaska state government, owning and maintaining more than 400 buildings across the state, totaling over 7.7 million gross square feet, with an adjusted value of over $3 billion. The challenge we now face is maintaining our facilities in these difficult fiscal times. UA’s current backlog of facilities maintenance exceeds $1 billion. Historically, the university also has looked to the legislature to provide annual capital appropriations to help address our deferred maintenance. Between FY08 and FY15, the legislature appropriated a total of $227 million, an average of $23 million a year to deferred maintenance. We very much appreciate that support. In FY16 we received $3 million but no funding in FY17. You can listen to the hearing and access committee materials here.

Thank you for your continued support of the University of Alaska. For more information, contact Miles Baker at miles.baker@alaska.edu or visit www.alaska.edu/state.

 

April 4, 2017

The Capitol Report

By Miles Baker

Associate Vice President Government Relations

Today is the 78^th day of the legislative session. Yesterday was a somber day for the University of Alaska here in Juneau.

President Jim Johnsen described yesterday’s action in the Alaska Senate as potentially “devastating” to the university.

After much delay, the Senate Finance Committee revealed a new version of the FY18 Operating Budget (HB57/HB59) on April 3^rd that would cut $22 million from the university, $5.7 million in new cuts in addition to the $16.3 million the Senate previously proposed. The Senate’s budget proposal would result in a $75 million (19.8 percent) cut over the last four years. The finance committee also adopted the House’s recommendation to take $17 million from the U-Med Northern Access project effectively ending state funding for this critical transportation infrastructure project. You can watch yesterday’s hearing here and access a summary of university impacts here. Alternatively, you can watch the 360 North broadcast of the hearing here. The bill is now on the Senate floor and will be voted on during tomorrow’s floor session.

The U-Med district is home to several of the largest employers in the state and the healthcare sector is one of the bright spots of Alaska’s economy. The high concentration of research, science and medical facilities in the U-Med District provide a tremendous economic opportunity for Anchorage, the university and our state. Unfortunately, transportation infrastructure in the area hasn’t kept up. The Northern Access Project, a north-south road linking Elmore Road to Bragaw Street at Northern Lights Boulevard, is critical to solving the congestion and would improve safe access to important education and health facilities. Yesterday’s action makes it extremely unlikely this project will move forward anytime in the near term.

In a separate action yesterday, the Senate Finance Committee introduced SB 103, which would eliminate the very successful Alaska Performance Scholarship (APS) program within the next four years. The legislation replaces the APS program with a competitively awarded “innovative” grant program for school districts. Current APS recipients and eligible high school seniors would get scholarships for up to four years but the program will end by the 2020-21 academic year. The Alaska Legislature created the APS in 2011 to inspire our state’s high school students to prepare for and succeed in post-secondary education. It was designed to help reduce the number of Alaska high school graduates leaving the state for school. APS recipients require fewer developmental classes, are more likely to excel in their studies, take more credit hours and stay to work in Alaska. An initial Education Committee hearing was held this afternoon. Public testimony will be taken tomorrow morning at 8:00 a.m.

Under the normal 90-day legislative cycle we’d be looking at just under two weeks left to wrap up business for the year. I’m now operating under the assumption that it will take the legislature at least four more weeks to reach an agreement on a fiscal framework for the state.

Stay tuned for more information on how you can advocate on behalf of the university as we enter the final several weeks of negotiations on the budget and other impactful public policy issues.

Bills on the Move

SB 96, another major K-12 education bill, continues to move quickly through the Senate. The Education committee spent the majority of last week discussing that legislation, including a preliminary round of public testimony. The initial draft of the bill was met with stiff resistance from many school districts and administrators around the state. A revised version of the bill was moved out of the Education committee today and it has been scheduled for the Senate Finance Committee on Thursday, April 6th at 9:00 a.m.

Yesterday, April 3^rd at 8:00 a.m. the Senate Education Committee held a preliminary hearing on HB 64 which creates a task force on reading proficiency and instruction and the effects of dyslexia. UA would have one representative on the 15-member task force. You can listen to the hearing and access committee materials here. Alternatively, you can watch the 360 North broadcast of the hearing here.

Coming Up Later This Week:

Thursday, April 6^th at 1:30 p.m. the House Finance Committee will hold a third hearing on HB 141, Representative Fansler’s bill extending the Technical Vocational Education Program (TVEP) for five years through 2022. Last Friday, the bill was expected to move out of committee but was held over to allow members more time to consider possible changes to the program. You can listen to last week’s hearing and access committee materials here. Alternatively, you can watch the 360 North broadcast of the hearing here.

Thursday, April 6^th at 1:30 p.m. the Senate Finance Committee will hold public testimony on the FY18 Capital Budget, SB 23.

Friday, April 7^th at 9:00 a.m. the Senate Labor and Commerce Committee is scheduled to have a preliminary hearing on SB 85, the Senate version of the TVEP reauthorization bill. The Senate bill would reauthorize the program for three years as compared to HB 141 which calls for a 5-year reauthorization.

Thank you for your continued support of the University of Alaska. For more information, contact Miles Baker at miles.baker@alaska.edu or visit www.alaska.edu/state.

 

March 28^th, 2017

The Capitol Report

By Miles Baker

Associate Vice President Government Relations

Today’s the 71^st day of the legislative session. Hope everyone had a wonderful Seward’s Day.

Hurry up and wait

Although the House technically passed its version of the state operating budget last Monday, the bill was not transmitted to the Senate until Friday. Since the Senate didn’t technically receive the bill until yesterday morning, it won’t have its first Senate Finance Committee hearing until Wednesday morning. While delays of this sort aren’t atypical, it’s one of a number of indications that it’s unlikely the legislature will conclude its business by April 16^th, the scheduled 90-day end date for the regular session.

The Senate Finance Committee has scheduled the balance of the week and this weekend to incorporate the House’s recommendation into its own operating budget work. One of the biggest question marks is where the Senate will come down on K-12 education funding. For now, that decision is on hold, but there are indications that a 5 percent cut or $60 million reduction is possible.

Tax Legislation

As expected the House Finance Committee spent all of last week discussing HB 111, the House Majority’s oil and gas tax reform proposal. The week concluded with a Saturday morning round of public testimony. It’s unclear when that bill will resurface but no additional hearings have been scheduled for this week. This week the committee is shifting its attention back to HB 115, the majority’s proposal to restructure the Permanent Fund and institute a state income tax. Last Thursday, the committee introduced a new substitute bill incorporating a number of committee amendments and other changes. You can review a summary of those changes here. Public testimony on HB 115 is scheduled for Wednesday of this week.

Yesterday, the House Education Committee passed HB 146, Rep. Claman’s school income tax legislation. The legislation taxes the adjusted gross income of every person who earns income in Alaska. The revenue collected from the tax would be deposited into the general fund with the intent of having that income designated for public education. You can listen to the hearing here. The bill now heads to the House Finance Committee.

Bills on the Move

Last week the Senate Education Committee introduced SB 96, a substantial education reform initiative. The legislation creates a virtual education consortium to allow students to take courses offered by other school districts, incentivizes districts to pool their resources, restructures the Education Trust Fund and mandates other administrative efficiency reforms. A preliminary Senate Education Committee hearing was held on Wednesday March 22^nd. You can watch the hearing and get committee presentation materials here. The committee has scheduled additional hearings Monday, Tuesday, Thursday and Friday of this week.

On Wednesday March 24^th, the House passed HB 64 which creates a task force on reading proficiency and instruction and the effects of dyslexia. UA would have one representative on the 15-member task force. The UA representative would be highly knowledgeable or skilled in teaching reading to both typically and atypically developing students. The bill has been referred to the Senate Education Committee where Senator Dunleavy’s companion bill SB 27 currently resides. Additional background information on the legislation is available here.

Thursday, March 23rd at 9:00 a.m. the Senate Finance Committee held a preliminary hearing on SB 31, Governor Walker’s proposal to impose a two-year salary freeze on non-union public employees. You can listen to the hearing and access committee materials here. Alternatively, you can watch the 360 North broadcast of the hearing here. 

Friday, March 24^th at 8:00 a.m. the Senate Education Committee held a preliminary hearing on SB 78, Senator Bishop’s legislation creating an education endowment fund and Permanent Fund Dividend lottery. You can listen to the hearing and access committee materials here. Alternatively, you can watch the 360 North broadcast of the hearing here. The committee has scheduled a second hearing for this Thursday, March 30^th at 8:00 a.m.

Saturday, March 25^th at 1:00 p.m. the House Labor & Commerce Committee held a preliminary hearing on HB 83, Representative Kito’s bill establishing a new tier within the Public Employee Retirement System (PERS) and the Teachers Retirement System (TRS) that would give new employees an option of selecting either a defined benefit or defined contribution pension benefit. You can listen to the hearing and access committee materials here. Alternatively, you can watch the 360 North broadcast of the hearing here. The Senate companion bill, SB 52, sponsored by Senator Egan has not had a hearing.

Coming Up Later This Week:

This morning at 10:00 a.m. the House Fisheries Committee will hold a preliminary hearing on House Concurrent Resolution 8, a committee resolution urging the University of Alaska to maintain the Kodiak Seafood and Marine Science Center (KSMSC). Supporting documents for the hearing can be found here. You may recall that the committee held a hearing on February 21^st during which KSMSC was discussed and the draft resolution was introduced.

Wednesday, March 29^th at 8:00 a.m. the State Board of Education is scheduled to present to a joint meeting of the House and Senate Education Committees.

Friday, March 31^st at 1:30 p.m. the House Finance Committee will hold a second hearing on HB 141, Representative Fansler’s bill extending the Technical Vocational Education Program (TVEP) for five years through 2022. The University of Alaska depends on TVEP funds to help educate and train the skilled and talented workforce Alaska needs to build a diverse, robust and competitive economy. The Senate Labor & Commerce Committee has introduced SB 85, which would extend the TVEP program for 3 years. That bill had been scheduled to be heard last Thursday, but has been postponed until a future date.

Thank you for your continued support of the University of Alaska. For more information, contact Miles Baker at miles.baker@alaska.edu or visit www.alaska.edu/state.

 

March 20^th, 2017

The Capitol Report

By Miles Baker

Associate Vice President Government Relations

Today is the 63rd day of the legislative session.

Here’s an interesting factoid to start your week: the House and Senate have introduced a total of 281 bills since the session began. To date, just one of those bills has passed and is awaiting transmittal to the governor. The bill, SB 33 names two of our new state ferries.

Last week saw both the House and Senate move on several of their major individual policy priorities as both bodies start positioning themselves for end-game negotiations. On Wednesday, the Senate passed SB 26 allowing annual draws of 5.25 percent from Permanent Fund earnings to fund government expenditures. The bill also sets dividends at $1000 for the next three years and includes a provision that caps annual state spending at $4.1 billion. Meanwhile, the House Resources Committee voted along party lines to advance HB 111, its oil and gas tax reform proposal, to the House Finance Committee. With the committee’s work on the operating budget concluded, it has scheduled the entire week to discuss HB 111.

Budget Action

Following a full week of floor debate and discussion of over 130 amendments, the House finalized their work on the state’s FY18 operating budget (HB 57/HB 59) today, voting 22-17 on party lines to pass the bill.  The bill will now be transmitted to the Senate for consideration.

During the House floor debate on the budget last week, two amendments were presented with potential impacts on the university. Amendment #26 was offered by Rep. Tarr around 1:45 p.m. Tuesday afternoon. The amendment takes approximately $18 million in state funds away from the Municipality of Anchorage (MOA) that are currently designated for the University-Medical District Northern Access Project — a north-south road linking Elmore Road and south Bragaw Street. In 2013, the Legislature appropriated $20 million to the MOA for the “U-Med Road” project. Since then, the MOA and the Department of Transportation have done some early design and planning work on the project and the current appropriation balance is estimated at about $18 million. The project enjoys broad support not only from the University of Alaska, but from APU, Providence, the Alaska Native Tribal Health Consortium, and the Southcentral Foundation. The project has however, faced some resistance from local interests and project work has been suspended under Anchorage Mayor Ethan Berkowitz’s administration. President Johnsen described the project as “critical to the economic life, safety and vitality” of the area. The University of Alaska owns the land that will be needed for the road’s construction and last year the legislature attempted to transfer the money from the MOA to the university. Unfortunately, Governor Walker vetoed that transfer. Rep. Tarr’s amendment passed on a 23-17 vote, effectively ending state funding for the project by removing the remaining funds and depositing them into the public education fund. For this action to become law, both the Senate and the Governor will have to agree. We will be working with other interested parties to advocate against this amendment so that we retain financial resources critical to continuing to advance this important project on behalf of the university system, UAA and the surrounding area.

The second amendment, Amendment #56 proposed on Thursday by Rep. Wool, would have increased the university’s $325 million unrestricted general fund (UGF) budget by $16.2 million, restoring it to the Board of Regents’ full $341 million request. Rep. Wool gave well-reasoned arguments for why the state should be making more, not less investment in the university at this time. Rep. Wool has been a strong advocate throughout this year’s House budget process. However, knowing his amendment lacked the 21 votes needed to pass, Rep. Wool withdrew it before putting it to a vote. No other members rose to discuss the amendment or university funding.

On the other side of the capitol, the Senate Finance Committee rolled out their version of the FY18 Operating Budget (SB 22/SB 24) on Wednesday afternoon. As expected, the Senate Finance Committee substitute bill fully accepted the recommendation of Senator von Imhof’s subcommittee to cut the university’s UGF budget by another 5 percent. You can access the committee’s close out report on the university and watch the hearing here. Alternatively, you can watch the 360 North broadcast of the committee’s budget closeout hearing here. The Senate Finance Committee took public testimony on the budget during two long sessions Thursday and Friday. Thanks to those of you who took time to weigh in and communicate your support for the university directly to legislators.

With the bulk of detailed budget work done, we are now positioned for an important conference committee negotiation which will begin later in the session between the House’s $325 million funding level and the Senate’s $309 million level. The Senate’s number is 9.5 percent or $32.4 million below the Board of Regents’ request of $341 million. The Senate’s funding level represents a nearly $70 million or 19 percent reduction in our budget just in the last four years.

Other University Activity from Last Week

Wednesday, March 15^th at 8:00 a.m. the Senate Education Committee held a confirmation hearing for Regent Karen Perdue. Regent Perdue was appointed by Governor Walker February 6^th to her first term on the board. Regent Perdue’s nomination was forwarded by the committee to be considered by a joint session of the legislature that has yet to be scheduled. You can listen to the hearing and access committee materials here. Alternatively, you can watch the 360 North broadcast of the confirmation hearing here.

Wednesday, March 15^th at 8:30 a.m. the House Education Committee also held a confirmation hearing for Regent Perdue. The committee also forwarded Regent Perdue’s name to be considered by a joint session of the legislature. You can listen to the hearing and access committee materials here. Alternatively, you can watch the 360 North broadcast of the confirmation hearing here.

Wednesday, March 15^th at 9:30 a.m. the Senate Finance Committee held confirmation hearings on Regent Hughes and Regent Perdue. Regent Hughes was reappointed on February 6^th by Governor Walker to serve a third term on the Board of Regents. Both nominees were forwarded by the committee to be considered by a joint session of the legislature. You can listen to the hearing and access committee materials here. Alternatively, you can watch the 360 North broadcast of the confirmation hearing here.

Thursday, March 16^th at about 4:30 p.m. the House Finance Committee held a preliminary hearing on HB 141, Representative Fansler’s bill extending the Technical Vocational Education Program (TVEP) for five years through 2022. You can watch the hearing and get committee documents here. Alternatively, you can watch the 360 North broadcast of the hearing here. It’s expected the committee will bring the bill back up later this week under “Bills Previously Heard."

Events of Interest This Week

This morning, March 20^th at 8:00 a.m. the Senate Education Committee held a final confirmation hearing for Regent Hughes. Regent Hughes’ name was forwarded by the committee to be considered by a joint session of the legislature. You can listen to the hearing and access committee materials here. Alternatively, you can watch the 360 North broadcast of the confirmation hearing here.

Thursday, March 23^rd at 9:00 a.m. the Senate Finance Committee will hold a preliminary hearing on SB 31, Governor Walker’s proposal to impose a two-year salary freeze on non-union public employees.

Thursday, March 23^rd at 1:30 p.m. the Senate Labor & Commerce Committee will hold a preliminary hearing on SB 85, which extends the Technical Vocational Education Program (TVEP) for 3 years through 2020. The University of Alaska depends on TVEP funds to help educate and train the skilled and talented workforce Alaska needs to build a diverse, robust and competitive economy. SB 85 is similar to HB 141 except that HB 141 seeks a 5-year extension of the program.

Thank you for your continued support of the University of Alaska. For more information, contact Miles Baker at miles.baker@alaska.edu or visit www.alaska.edu/state

March 13^th, 2017

The Capitol Report

By Miles Baker

Associate Vice President Government Relations

Today is the 56^th day of the legislative session.

Last Friday, following a week of debate and hundreds of proposed amendments, the House Finance Committee finished its work on the state’s FY18 operating budget. This afternoon, the House will begin full floor debate on the bills (HB 57/HB 59). A final vote on the bills is several days away as many expect the House Minority will take another run at many of the same amendments that were voted down by the Finance Committee last week.

House Finance Committee

The House Finance Committee’s final discussion on the university’s budget occurred late Thursday evening at the end of a full week of amendments touching on every aspect of the state’s budget. There were only two amendments presented to the committee with the potential to impact the university’s budget. Both amendments are contained on page 96 of the final amendment package. Representative Guttenberg drafted an amendment (H UOA 6) that would have increased our $325 million unrestricted general fund (UGF) budget by $16.2 million, restoring it to the Board of Regents’ full $341 million request. However, when it came time for Rep. Guttenberg to offer the amendment, he withdrew it without comment. There was no discussion of his action or on his amendment by other committee members. This was discouraging. President Johnsen and I spent a tremendous amount of time over the last week meeting with legislators and building support for the amendment. Thanks to those of you who also took time to weigh in and communicate your support directly to legislators. We believe the votes to support the amendment were there if it been offered and put to a vote. One of the guiding principles of the House Majority Coalition is to hold the line on all agency budgets and to not increase spending substantially above the governor’s proposal. Ultimately, a desire by the majority to hold to that principle scuttled introduction of the amendment. The second amendment offered by Representative Tammie Wilson (H UOA 7), was the exact opposite of Guttenberg’s amendment. Rep. Wilson’s amendment proposed to cut $16.3 million or 5 percent from the $325 million spending level already endorsed by the committee. Rep. Guttenberg and Rep. Kawasaki spoke in opposition to the amendment. Rep. Grenn added that he believed the university was on the right track and that the $325 million proposed by the governor was a sufficient level of funding given the difficult fiscal situation facing the state. Rep. Wilson provided a number of arguments in support of her amendment, which ultimately failed on a 7-3 vote with Rep. Tilton and Rep. Pruitt joining Wilson to vote in favor. Rep. Thompson and all the majority members of the committee voted against and Rep. Gara was away from the table at the time of the vote. You can watch the House Finance Committee’s discussion of the university’s budget and Rep Wilson’s amendment here or watch 360 North’s broadcast here. The discussion of the university begins at about 3:57pm on both recordings.

The summary numbers that the full House of Representatives will begin considering today for the university’s FY18 operating budget are listed below.$325.0 million Undesignated General Funds (UGF)$331.6 million Designated General Funds (DGF)$143.9 million Federal$  86.7 million Other$887.1 million Total

This budget is still $16 million below the regents’ request, and $53 million below our UGF funding level just three years ago. More details on the House numbers for the university are available here and you can review the two intent language pieces that have been adopted by the House here. 

New Budget Action of Critical Concern

This morning at 8:00 a.m. the Senate Finance Subcommittee responsible for reviewing the university’s FY18 operating budget held its third and final hearing on our budget. At this morning’s close out, the subcommittee made a 5 percent ($16.252 million) reduction to the university’s UGF budget. While this action wasn’t unexpected, it’s now official. The only good news coming out of today’s meeting is that the subcommittee didn’t adopt any new intent language nor did it accept the intent language the House added on its side. Committee Chair Senator Natasha von Imhof and Senators Gary Stevens, Anna MacKinnon and Berta Gardner passed the recommendation out of committee without objection. Michelle Rizk, VP University Relations and I attended the meeting and made brief comments. You can access the committee’s closeout report and watch the hearing here. Alternatively, you can watch the 360 North broadcast of today’s closeout hearing here. The subcommittee’s report is scheduled to be presented to the full Senate Finance Committee this Wednesday afternoon at 1:00 p.m.

The Senate subcommittee’s action drops the university’s UGF budget to $308.8 million, $32.4 million or 9.5 percent below the Board of Regents’ request of $341 million. The Senate’s number is $16.2 million below the recommendations of the governor and the House. Perhaps of more significant concern, the Senate’s number represents nearly a $70 million or 19 percent reduction in our budget just in the last four years. We are now positioned for an important conference committee negotiation later in the session when we will be advocating for the House’s $325 million funding level and against the Senate’s $309 million level.

Until then, the next best opportunity for you to advocate on behalf of the university will be Wednesday and Thursday, March 15 and 16 when the Senate Finance Committee will hear public testimony on its version of the FY18 operating budget (SB 22/SB 24). I encourage you to take a moment to communicate your support for the university before the committee concludes its budget deliberations. You can do that in several ways, by participating in the public testimony coming up this week, or by calling or writing your legislators. Use one of these opportunities to explain why the university is a priority to you. Legislative office phone numbers are available here. You can contact your legislator by e-mail or via the Public Opinion Message (POM) system. Legislative e-mails are available here. If you wish to send an online POM go to: www.legis.state.ak.us/poms/.

We will provide additional information on the public testimony process later this week.

Other Activity of Interest from Last Week

Thursday, March 9^th at 11:15 a.m. the Senate subcommittee responsible for reviewing the university’s operating budget held its second hearing. UAA Professors Tim Jester and Forrest Nabors testified.  President Jim Johnsen participated from Fairbanks and addressed committee questions on a variety of topics, including Strategic Pathways, Statewide administrative costs, decentralization, and the School of Education consolidation process. You can listen to the hearing and access committee materials here. Alternatively, you can watch the 360 North broadcast of the hearing here.

Friday, March 10^th at 8:00 a.m. the Senate Education Committee heard SB 17, Senator Costello’s bill to establish the Stevens-Inouye Exchange Program, a reciprocal educational exchange between the University of Alaska and the University of Hawaii for students pursuing political science degrees. Saichi Oba, Associate Vice President of Student and Enrollment Strategy testified on behalf of the university, and expressed our support for moving forward with working out the details of establishing the exchange. You can listen to the hearing and access committee materials here. Alternatively, you can watch the 360 North broadcast of the hearing here.

Also on Friday at 8:00 a.m. the House Education Committee held a confirmation hearing for Regent Mary Hughes. Regent Hughes was reappointed by Governor Walker to serve a third term on the Board of Regents. You can listen to the hearing and access committee materials here. Alternatively, you can watch the 360 North broadcast of the confirmation hearing here.

Friday, March 10^th at 3:15 p.m. the House Labor & Commerce Committee held its second hearing on HB 141, Representative Fansler’s bill extending the Technical Vocational Education Program (TVEP) for five years through 2022. The University of Alaska depends on TVEP funds to help educate and train the skilled and talented workforce Alaska needs to build a diverse, robust and competitive economy. After limited public testimony, the legislation was moved out of committee without objection. You can watch the hearing and get committee documents here. Alternatively, you can watch the 360 North broadcast of the hearing here. The next committee of referral is the House Finance Committee which has scheduled a preliminary hearing for Friday, March 16^th at 1:30 p.m.

Other Events of Interest This Week

This morning, March 13^th at 8:00 a.m. the Senate Education Committee moved Senator Costello’s Stevens-Inouye Exchange Program bill from committee. Saichi Oba, Associate Vice President of Student and Enrollment Strategy answered a follow-up question from Senator Giessel regarding eligibility for in-state tuition. You can watch the hearing and get committee documents here. Alternatively, you can watch the 360 North broadcast of the hearing here.

Wednesday, March 15^th at 8:00 a.m. the House Education Committee will hold a confirmation hearing on Regent Karen Perdue. Regent Perdue is being appointed to her first term on the Board of Regents.

Wednesday, March 15^th at 9:00 a.m. the Senate Finance Committee will hold confirmation hearings on Regent Perdue and Regent Hughes.

Friday, March 16^th, the House Finance Committee is scheduled to hold a preliminary hearing on HB 141, Rep. Fansler’s TVEP reauthorization bill.

New Legislation of Interest to the UA Community

SB 85 (Labor & Commerce) – provides a three-year extension of the Technical Vocational Education Program (TVEP) until 2020. HB 141, the companion to this bill, would extend the program for five years until 2022.

You can find an index of legislation we are following this session here: http://www.alaska.edu/state/bill-tracker/

Thank you for your continued support of the University of Alaska. For more information, contact Miles Baker at miles.baker@alaska.edu or visit www.alaska.edu/state 

March 7th, 2017

The Capitol Report

By Miles Baker

Associate Vice President Government Relations

Today is the 50th day of the legislative session.

This week, the House Finance Committee will complete work on the state’s FY18 operating budget with the goal of getting the House bill (HB 57/HB 59) passed to the Senate by early next week.

The committee took up the university’s budget at their meeting last Monday evening. As expected, the committee accepted the university budget subcommittee’s recommendation of $325 million in unrestricted general funds for the university. While this represents level funding for the university it is still $16 million below the Board of Regents’ request of $341 million. After some lengthy debate, the committee adopted two intent language amendments that were offered by the subcommittee:

• That the university reduce the number of athletic teams at UAA and UAF to the minimum required by the NCAA
• That unrestricted general fund reductions or reallocations at the three main universities be no greater than those made at statewide administration

A third intent language amendment related to the difference in administrative costs between UAA and UAF’s athletics programs was not adopted. You can read the house subcommittee’s report here. Watch the House Finance Committee’s discussion of the university’s budget and the amendment votes here. The discussion of the university’s budget begins at about 4:55 p.m. in the hearing.

Today at 10 a.m., the committee will begin considering a final round of amendments on the house version of the bill. The operating budget is the only item on the committee’s agenda for the balance of this week. Representative Guttenberg will be offering a $16 million amendment to restore the university’s budget to the full Board of Regents’ $341 request. More than 200 pages of amendments have been proposed, so it is unclear at this point when the university’s amendment will be considered. You can review the complete four amendment packages here. The university’s amendments are on page 96 of the last amendment package.

I encourage you to take a moment to communicate your support for the university and urge support for Representative Guttenberg’s amendment. You can do that in several ways, including calling or writing your legislators to explain why strong financial support of the university is a priority to you. The legislative office phone numbers are available here. You can contact your legislator by e-mail or via the Public Opinion Message (POM) system. Legislative e-mails are available here. If you wish to send an online POM go to: www.legis.state.ak.us/poms/. Remember, when communicating with the legislature please do not use university email or other university resources, and please do so on your own time, such as during lunch or after work.

Other Events of Interest This Week

Yesterday the House Labor & Commerce Committee held a first hearing on HB 141, Representative Fansler’s bill to reauthorize the Technical Vocational Education Program (TVEP) through 2022. The University of Alaska depends on TVEP funds to help educate and train the skilled and talented workforce Alaska needs to build a diverse, robust and competitive economy. Fred Villa, Associate Vice President Workforce Development, testified in support of the reauthorization. You can watch the hearing and get committee documents here. More information on how the university is effectively using TVEP funding is available here.

Thursday, March 9th the Senate Subcommittee responsible for reviewing the university’s operating budget is scheduled to hold its second hearing. The agenda for that meeting has not yet been announced. The subcommittee is scheduled to close out on Monday March 13th. The Senate Majority has already indicated it intends to cut another 5 percent ($16.25 million) from the university’s budget, which will put UA $32 million below the Board of Regents’ request. As you know, the university has already sustained a $53 million (14 percent) reduction over the last three years. An additional 5 percent would represent nearly $70 million reduction.

Friday, March 10th the Senate Education Committee is scheduled to hear SB 17, Senator Costello’s bill to establish the Stevens-Inouye Exchange Program, a reciprocal educational exchange between the University of Alaska and the University of Hawaii for students pursuing political science degrees. The program is intended to commemorate and honor the long friendship and productive bipartisan relationship between Republican U.S. Senator Ted Stevens of Alaska and Democrat U.S. Senator Daniel Inouye of Hawaii.

Thank you for your continued support of the University of Alaska.

For more information, contact Miles Baker at miles.baker@alaska.edu or visit www.alaska.edu/state

February 27^th, 2017

The Capitol Report

By Miles Baker

Associate Vice President Government Relations

Today is the 42^nd day of the legislative session.

This week, the Alaska State House will hold two hearings a day in an effort to complete its operating budget work by early next week. Budget subcommittees have finished their work, and began reporting their recommendations to the full House Finance Committee last week. Those subcommittee reports will continue today and tomorrow.

The subcommittee responsible for reviewing and making recommendations on the university’s operating budget for next year held its final meeting on Thursday afternoon. The committee’s report will be presented to the full committee today at 1:00 p.m. The committee is recommending $325 million in unrestricted general funds for the university. This is the same as the university’s current funding level, and consistent with the Governor’s request. However, it is still $16 million below the Board of Regents’ request of $341 million for FY18. Representative Adam Wool proposed an amendment that would have added $16 million to the budget and fully funded the regents’ request. However, the subcommittee’s chairman Representative Guttenberg, did not put the amendment forward for consideration.

The subcommittee added three sections of legislative intent language to our budget:

• That the university reduce the number of athletic teams at UAA and UAF to the minimum required by the NCAA
• That unrestricted general fund reductions or reallocations at the three main universities be no greater than those made at statewide administration
• That athletics at UAA and UAF be funded equally, at the current UAF unrestricted general fund level for athletics

You can read the house subcommittee’s full report here. Watch the final house subcommittee meeting and its discussion on Rep Wool’s amendment here.

While this is just the first step in the legislature’s budget process, it becomes increasingly difficult to make changes to the budget as the process progresses. While the Senate is just beginning its own review of the budget, the Senate Majority has already indicated it intends to cut another 5 percent ($16.25 million) from the university’s budget, which will put us $32 million below the Board of Regents’ request. As you know, the university has already sustained a $53 million (14 percent) reduction over the last three years. An additional 5 percent would represent a $70 million reduction since FY15.

The House Finance Committee will continue its operating budget work throughout the week and will begin public testimony on the budget Thursday afternoon. I encourage you to take a moment to communicate your support for the university before the committee concludes its budget deliberations. You can do that in several ways, including calling or writing your legislators and by participating in public testimony on the budget. Use one of these opportunities to explain why the university is a priority to you.

Legislative office phone numbers are available here. You can contact your legislator by e-mail or via the Public Opinion Message (POM) system. Legislative e-mails are available here. If you wish to send an online POM go to: www.legis.state.ak.us/poms/. Remember, when communicating with the legislature please do not use university email or other university resources, and please do so on your own time, such as during lunch or after work.

Public testimony on the budget is scheduled to begin Thursday afternoon. We will provide additional information on how that process works later this week.

In other budget activity this week, the Senate subcommittee responsible for reviewing the university’s budget held its first hearing Thursday, February 23^rd. President Jim Johnsen responded to questions from Senators Natasha von Imhof, Gary Stevens and Berta Gardner. You can watch the hearing and get committee presentation materials here. You can watch 360 North’s broadcast of the committee here.

Other Events of Interest from Last Week

On Monday morning, President Johnsen discussed the university’s land grant deficit with the House Education Committee and give a similar presentation to the Senate Resources Committee later that afternoon.  You can watch 360 North’s coverage of the Education Committee’s hearing here and get President Johnsen’s presentation here. You can watch 360 North’s coverage of the Resources hearing here and get committee documents here.

On Tuesday, the House Fisheries Committee held a hearing on the Kodiak Seafood & Marine Science Center (KSMSC). Marine Advisory Program Director and KSMSC Co-Director Paula Cullenberg participated in the hearing. The committee adopted a resolution supporting continued legislative and university support of KSMSC. You can watch 360 North’s coverage here and get committee documents and a copy of the resolution here.

U.S. Senators Lisa Murkowski and Dan Sullivan were both in Juneau last week to deliver their annual addresses to the legislature. Senator Murkowski’s address was on Wednesday and Senator Sullivan’s was on Friday. You can watch 360 North’s coverage of Senator Murkowski’s address here as well as her post address press availability. You can watch Senator Sullivan’s address here and his post address press availability.

Also on Wednesday Dr. Lindsey Blumenstein with the UAA Justice Center participated in a “Lunch and Learn” organized by the Alaska Network on Domestic Violence and Sexual Assault. Dr. Blumenstein presented results from the Alaska Victimization Survey and the UA Campus Climate Survey. You can watch 360 North’s coverage here.

Coming Up This Week:

Today at 1:00 p.m. the House Finance Committee will receive the close-out recommendations from the University’s budget subcommittee.

Wednesday, March 1^st at 8:00 a.m. Department of Education and Early Development Commissioner Michael Johnson will be discussing academic results in Alaska’s K-12 schools.

Thursday, March 2^nd at 11:15 a.m. the Senate Subcommittee responsible for reviewing the university’s operating budget is scheduled to hold its second hearing. The agenda for that meeting has not been announced.

Thank you for your continued support of the University of Alaska.

For more information, contact Miles Baker at miles.baker@alaska.edu or visit www.alaska.edu/state

February 20, 2017

The Capitol Report

By Miles Baker

Associate Vice President Government Relations

Happy President’s Day. Today is the 35^th day of the legislative session.

Last week was a busy one for the University here in Juneau, with three committee hearings and President Johnsen’s State of the University address.

On Thursday morning, President Johnsen presented the University’s FY18 Operating Budget to the Senate Finance Committee. You can watch President Johnsen and get committee presentation materials here: http://www.akleg.gov/basis/Meeting/Detail?Meeting=SFIN%202017-02-16%2009:30:00#tab4_4.

The Senate Majority has announced a three-part plan to begin closing the state’s $3 billion budget deficit: establishing a statutory annual spending limit, restructuring the management of the Permanent Fund and cutting $750 million from the operating budget over the next 3 years. Article 9 Section 16 of Alaska’s constitution establishes an annual appropriation limit, but in practical application, the language hasn’t prevented the operating budget from continuing to grow during high revenue years. The Senate is proposing either constitutional and/or statutory reforms that will tie operating budget growth to changes in population and inflation. The Senate, like the House, is also evaluating proposals for managing the Permanent Fund more like an endowment, with a portion of annual earnings being available to fund government operations.

Of particular concern to the university, is the Senate’s proposal to cut $750 million from the state’s operating budget over the next three years. The plan calls for a 5%, $300 million reduction this year, another 4% next year and 3% the following year. Finance Committee members have indicated that they will be looking to specifically reduce the largest general fund budget recipients, those include K-12 Education, Health & Social Services, and the university. Below are the top five unrestricted general fund budget requests this year.

1. Dept of Education & Early Development   $1,297 million
2. Dept of Health & Social Services  $1,063 million
3. University of Alaska   $325 million
4. Dept of Public Safety  $155 million
5. Dept of Transportation   $146 million

As we all know, the university has already taken a significant $53 million (14%) reduction over the last three years. This year, the Governor’s $325 million request for the university is already $16.3 million (5%) below the $341 million requested by the Board of Regents. A 5% reduction from the Governor’s number represents an additional $16.3 million reduction. We will be advocating aggressively for the legislature to not only maintain our current funding but to consider growing their long-term investment in the university. Please stay tuned for opportunities to weigh in on this critically important issue in the days ahead.

In other important budget news, this Thursday, February 23^rd at 4:30 p.m. the House Finance University Subcommittee will hold its final hearing on our FY18 budget request and is expected to close out their budget review. Subcommittee members are required to have any budget amendments turned in by 5:00pm today. The subcommittee is soliciting public input on our budget through 5 p.m. tomorrow, February 21. They are using the Legislative Information Office’s Public Opinion Message System to facilitate that process. Your input will be considered by the subcommittee as it develops budget recommendations to send to the full House Finance Committee. If you wish to send an online POM go to: www.legis.state.ak.us/poms/. I encourage you to share your thoughts on the university, the university's budget, or on programs or activities that are important priorities to you. When communicating with the legislature please do not use university email or other university resources, and please do so on your own time, such as during lunch or after work. There will be an opportunity to provide public comments on the budget later in the process.

Other Events of Interest from Last Week

President Johnsen delivered his annual State of the University address to a packed house at the Hanger Ballroom in Juneau Thursday at noon. This year’s event was part of the Alaska Chamber and the Juneau Chambers Business Roundtable lunch series. President Johnsen outlined the many strengths and serious challenges facing the university. Because of these challenges it’s critical that “we keep our eyes on what we can be, what we must be, and the assets we have to build the university and the state we all want.” He declared our greatest strength is our people—faculty, staff, students, alumni, donors, and partners. Video and transcript of the address are posted at www.alaska.edu/pres/sou. You can also watch 360 North’s recording of the address here https://mediaplayer.invintusmedia.com/?clientID=2147483647&eventID=2017021276

Thursday afternoon, Dan White VP Academic Affairs and Research, delivered a presentation to the Senate Labor & Commerce Committee on how the university is supporting economic development through innovation. Dan outlined the benefits of commercializing university research and innovation, the effort being made to identify and protect the intellectual property of our innovative faculty and students, and highlighted some of the exciting examples of faculty-led startups and new technologies being developed at our campuses. You can watch the hearing and get committee presentation materials here: http://www.akleg.gov/basis/Meeting/Detail?Meeting=SL%26C%202017-02-16%2013:30:00#tab4_4

Also on Thursday, the House Finance University Budget Subcommittee held its third meeting on our FY18 operating budget. President Johnsen and Michelle Rizk, VP University Relations reviewed with the committee the Education Tax Credit, the university’s athletics programs, several categories of tuition waivers, and our participation in the Western Interstate Commission on Higher Education (WICHE) and its student exchange programs. You can watch the hearing and get committee presentation materials here: http://www.akleg.gov/basis/Meeting/Detail?Meeting=HUA%202017-02-16%2016:30:00#tab4_4

Coming Up This Week:

Today at 9:00 a.m. President Johnsen discussed the university’s land grant deficit with House Education Committee. You can watch the hearing and get committee presentation materials here: http://www.akleg.gov/basis/Meeting/Detail?Meeting=HEDC%202017-02-20%2009:00:00#tab4_4

Today at 3:30 p.m. President Johnsen will give a similar land grant deficit presentation to the Senate Resources Committee.

Tuesday, February 21^st at 10:00 a.m. the House Fisheries Committee will hold a hearing on the Kodiak Seafood & Marine Science Center (KSMSC) by the Alaska Resource Consortium. The committee will be discussing a resolution that proposes the legislature should continue to strongly support KSMSC and urging the university to find a solution that keeps the center in operation.

Wednesday, February 22^nd at 11:00 a.m. U.S. Senator Lisa Murkowski will address a joint session of the legislature.

Also on Wednesday the UAA Justice Center will be participating in a “Lunch and Learn” at 12:00 p.m. Dr. Lindsey Blumenstein will be presenting results from the Alaska Victimization Survey and the University of Alaska Campus Climate Survey. The event is organized by the Alaska Network on Domestic Violence and Sexual Assault.

Thursday, February 23^rd at 11:15 a.m. the Senate Finance University Subcommittee will hold its first hearing on the university’s FY18 operating budget. Senator Natasha von Imhof is chairing the subcommittee, which also includes Senators Anna MacKinnon, Gary Stevens, and Berta Gardner.

Friday, February 24^th at 10:30 a.m. U.S. Senator Dan Sullivan will address a joint session of the legislature.

Thank you for your continued support of the University of Alaska.

For more information, contact Miles Baker at miles.baker@alaska.edu or visit www.alaska.edu/state

February 13^th, 2017

The Capitol Report

By Miles Baker

Associate Vice President, Government Relations

 

Today is the 28^th day of the legislative session. It’s difficult to believe but by the time this week is over, we will be one-third of the way through the regular 90-day session. 

I’m happy to welcome several important university advocacy groups to Juneau this week. The Coalition of Student Leaders arrived Saturday for their annual Legislative Conference. Student representatives from all three universities are here to participate in valuable policy discussions and to advocate for the university. I was honored to speak with the students yesterday morning and to participate in their legislative priorities discussion. Also joining me in the Capitol this week are representatives from each of our three alumni associations who have come together this year for a joint “UA Impact” fly-in. Both groups have busy agendas that include meetings with individual legislators over the next several days. The interest and enthusiasm they demonstrate for the university is incredibly valuable to this process.

Most of the excitement in the Capitol last week centered on the introduction of two major pieces of legislation by the House Majority Coalition.

HB 111, introduced on Wednesday by the House Resources Committee, scales back some of the state’s oil and gas tax credits. The bill establishes a 4 percent production tax floor, reduces the per barrel credit, and reduces the net operating loss (NOL) credit. Sponsors estimate the bill could result in $100 to $300 million in additional revenue to the state at $70 per barrel oil. House Resources Committee hearings are scheduled for today and Friday.

HB 115, introduced on Friday by the House Finance Committee, is the Majority Coalition’s fiscal reform package. The bill restructures the Permanent Fund to allow 4.75 percent of its overall market value to be drawn off annually with one-third of the revenue paying dividends and the remaining two-thirds paying for state services. Under the proposal, dividends would be approximately $1,100 and the general fund would receive approximately $1.5 billion to $2 billion annually. The bill also establishes a new income tax of 15 percent of an individual’s federal income tax and a capital gains tax of 10 percent. The taxes would raise an estimated $655 million annually once fully implemented. HB115 is the latest of several Permanent Fund restructuring proposals introduced this year. For the sixth year in a row, the state will have to draw on its savings accounts to balance the budget. But with only another year’s worth of savings available, serious conversations are happening about how the Permanent Fund’s earnings will be part of the revenue mix going forward. HB 115 is scheduled for four hearings in the House Finance Committee this week, with a round of public testimony set for Friday at 1:30 p.m.

In University related news: Wednesday morning, President Jim Johnsen provided an overview to the Senate Education Committee. President Johnsen discussed the university’s mission, the “65 by 2025” education imperative, the correlation between income and educational attainment, Strategic Pathways, the regents’ 10-year budget glide path, and the Board’s highest priorities for continued investment. President Johnsen outlined the significant impacts that three years of budget reductions have had across the entire system. He noted that the university is the number one Arctic research university in the world. That work helps attract graduate students from all over the world and improves the quality of education in the classroom, while solving Alaska specific problems and informing global climate policy. You can watch President Johnsen and get committee presentation materials here: http://www.akleg.gov/basis/Meeting/Detail?Meeting=SEDC%202017-02-08%2008:00:00#tab4_4

Thursday afternoon, the University of Alaska House Finance Budget Subcommittee held its second meeting on UA’s FY18 operating budget. Dan White, VP Academic Affairs and Research presented for the university. Dan explained the “65 by 2025” education imperative, UA’s partnership with the state Department of Education and Early Development and outlined UA’s early plans for increasing enrollment and retention. You can watch Dan and get committee presentation materials here: http://www.akleg.gov/basis/Meeting/Detail?Meeting=HUA%202017-02-09%2016:30:00#tab4_4

Friday afternoon, Dr. Ralph Townsend, director of the Institute of Social and Economic Research (ISER), participated in a House Finance Committee hearing on fiscal policy planning and forecasting. Dr. Townsend and the team at ISER continues to demonstrate their value to policy makers in Juneau. Dr. Townsend reviewed the tax options available to the state and emphasized the importance of multi-year fiscal planning to mitigate risks of depleting the Permanent Fund’s earnings reserve. You can watch Dr. Townsend and get committee presentation materials here: http://www.akleg.gov/basis/Meeting/Detail?Meeting=HFIN%202017-02-10%2013:30:00#tab4_4

 

Coming Up This Week:

Wednesday is the statutory deadline for the Governor to submit his FY18 budget amendments. The legislature can always consider amendments after that date, but for those amendments to be considered in the legislature’s normal budget process, they must be transmitted by the 30^th day of the session. 

Wednesday, February 15^th at 8:00 am the House Finance Education Subcommittee will be discussing the Alaska Post-Secondary Education Commission, WWAMI program, Alaska Performance Scholarships and the Student Loan Corporation.

Thursday, February 16^th at 9:30 am President Johnsen will present the University’s FY18 Operating Budget to the Senate Finance Committee. This is the first Senate Finance hearing on the University’s budget.

Thursday, February 16^th at 12:00pm President Johnsen will give his annual State of the University address at the Hanger Ballroom in Juneau. The event is part of the Alaska Chamber and the Juneau Chamber’s Business Roundtable lunch series. Doors open at 11:30 and the program begins at noon. Video and transcript of the address will be posted at http://www.alaska.edu/pres/sou.

Thursday, February 16^th at 1:30pm Dan White, VP Academic Affairs and Research, will be part of a Senate Labor & Commerce Committee hearing on economic innovation. The hearing is being held in conjunction with the Juneau Economic Development Council’s Innovation Summit in Juneau this week: http://jedc.org/innovation/.

Thursday, February 16^th at 4:30pm the University of Alaska House Finance Budget Subcommittee will hold its third meeting on the university’s FY18 budget. The topics expected to be covered include the Alaska Education Tax Credit, athletics, and indirect expenditures.

 

New Legislation of Interest to the UA Community:

HB 11 (Kawasaki) – would implement a temporary, voluntary program to allow employees enrolled in PERS (Public Employees’ Retirement System) or TRS (Teachers’ Retirement System) an ability to retire up to three years early.

You can find an index of legislation we are following this session here: http://www.alaska.edu/state/bill-tracker/

Thank you for your continued support of the University of Alaska.

For more information, contact Miles Baker at miles.baker@alaska.edu or visit www.alaska.edu/state

February 6^th, 2017

The Capitol Report

By Miles Baker

Associate Vice President, Government Relations

 

Today is the 21^st day of the legislative session. The regular 90-day session is scheduled to end on April 16^th.

As is tradition, particularly in the first year of a two year legislative cycle, legislative standing committees spent the first several weeks familiarizing themselves with some of the major policy areas they are expected to review. Finance Committees received revenue and budget presentations from the Governor’s OMB Director, the Revenue Commissioner and their own Legislative Finance Director. Education Committees met jointly to receive overviews of the Department of Education, the state’s K-12 funding formula and the federal Every Student Succeeds Act (ESSA). The Senate Labor and Commerce Committee led by Anchorage Senator Mia Costello held several days of hearings on Alaska’s economy.

On January 20^th the House Finance Committee initiated public hearings on Governor Walker’s FY18 operating budget. Over the last two weeks, every major state agency has been called on to provide brief overviews to the committee. University President Jim Johnsen appeared on Tuesday January 31^st to present the University’s budget. President Johnsen discussed the university’s education, research and service mission. He introduced the “65 by 25” educated workforce imperative, the Strategic Pathways initiative, the regents’ 10-year budget glide path, and highlighted the highest priority areas for continued strategic investment. This year the committee gave very specific parameters for how they wanted agencies to present their budgets. As required by state budgeting protocols, the university reports its budget by the three program categories that align with our primary missions: student instruction, research and service. Institutional support and physical plant costs are distributed proportionally across each of these three categories. President Johnsen outlined the programmatic allocation of the university $917 million FY18 budget: $635 million (71%) towards the Student Instruction category, $189 million (21%) to the Research category, and $75 million (8%) to the Service category. Importantly, President Johnsen outlined the significant impacts that three years of budget reductions have had across the entire system. You can watch President Johnsen’s presentation here: http://www.akleg.gov/basis/Meeting/Detail?Meeting=HFIN%202017-01-31%2013:30:00#tab4_4

Co-Chairman Paul Seaton who is managing the House operating budget process, is taking a somewhat non-traditional approach this year. Instead of forming separate budget subcommittees, the responsibility for detailed budget reviews has been assigned to an existing House standing committee. The standing committees will then convene as finance subcommittees chaired by a member of the House Finance Committee. The University of Alaska’s budget subcommittee consists of the members of the House State Affairs Committee with the addition of finance member Representative David Guttenberg who chairs the group. The University budget subcommittee in the House is:

Representative David Guttenberg, Chair (D-Fairbanks)

Representative Chris Birch (R – Anchorage)

Representative DeLena Johnson (R-Palmer)

Representative Gary Knopp (R-Kenai)

Representative Jonathan Kreiss-Tomkins (D-Sitka)

Representative Gabrielle LeDoux (R-Anchorage)

Representative Chris Tuck (D-Anchorage)

Representative Adam Wool (D-Fairbanks)

On January 31^st the budget subcommittee held its first hearing. President Jim Johnsen provided an overview of the university, our strategic objectives, FY18 budget request and responded to a variety of committee questions. The hearing and presentation materials can be viewed here http://www.akleg.gov/basis/Meeting/Detail?Meeting=HUA%202017-01-31%2016:30:00#tab4_4

The subcommittee has scheduled three more hearings and is expected to complete their work and report their recommendations back to the full House Finance Committee by February 24^th. 

Thursday Feb 9^th 4:30pm

Thursday Feb 16^th 4:30pm

Thursday Feb 23^rd 4:30pm

The Senate has yet to begin their detailed review of the FY18 budget, but on February 1^st, the Finance Committee announced budget subcommittee assignments. The University’s budget subcommittee in the Senate will be:

Senator Natasha von Imhof, Chair (R- Anchorage)

Senator Berta Gardner (D-Anchorage)

Senator Anna MacKinnon (R-Eagle River

Senator Gary Stevens (R-Kodiak)

The University’s Institute of Social and Economic Research (ISER) is playing a prominent role in the early legislative policy discussions here in Juneau. ISER is at the forefront of fiscal policy analysis in Alaska and the institute’s work is helping policy makers better understand the state’s financial challenges and the options available to address them. Of particular interest is the financial model ISER has developed for estimating short- and medium-run economic effects of various policy changes. The legislature’s reliance on ISER’s faculty and research is an excellent example of the tangible benefits continued public investment in the university’s research institutions provides. ISER Director Dr. Ralph Townsend, Associate Professor of Economics Mouhcine Guettabi, and Professor Emeritus Gunnar Knapp have all participated in hearings over the last several weeks:

Jan 18^th 1:30pm Senate Labor & Commerce – What do we know about Alaska’s economy?, Mouhcine Guettabi

Jan 19^th 1:30pm Senate Labor & Commerce – Moving Alaska’s Economy Forward, panel featuring Ralph Townsend

Jan 24^th 3:30pm Senate State Affairs – Alaska’s Economy, Ralph Townsend

Jan 25^th 1:30pm House Finance – Modeling Alaska’s Fiscal Proposals, Gunnar Knapp

Jan 26^th 12:00pm Lunch & Learn – Modeling Alaska’s Fiscal Proposals, Gunnar Knapp

Feb 2^nd 3:30pm Senate State Affairs – Questions on Alaska’s Economy, Ralph Townsend

Coming Up This Week:

Wednesday, February 8^th at 8:00am University President Jim Johnsen will be providing an overview of the University to the Senate Education Committee.

Wednesday, February 8^th at 11:00am the House and Senate will be meeting in Joint Session to hear the State of the Judiciary Address by Chief Justice Craig Stowers.

Wednesday, February 8^th at 1:00pm and Thursday, February 9^th at 9:00am, the House and Senate Joint Task Force on Civics Education will be discussing the release of the Task Force’s preliminary report.

Thursday, February 9^th at 4:30pm the House Finance University Subcommittee will hold its second budget hearing. The topics expected to be covered are: the 65 by 2025 educated workforce imperative and the university’s recruitment, retention and enrollment strategies.

Friday, February 10^th at 1:30pm, Dr. Townsend is scheduled to appear before the House Finance Committee to take part in another discussion on Alaska’s economy.

Saturday, February 11^th – Tuesday, February 14^th: The Coalition of Student Leaders and the University of Alaska Alumni Associations will in Juneau for their fly-ins. I look forward to working with both organizations to make these advocacy trips as memorable, fun and effective as possible. 

New Legislation of Interest to the UA Community:

HB71/SB31 (Governor Walker) –The bill freezes pay increases, merit increases, pay increments, bonuses and comparable salary increases for non-union public employees for two years. Approximately 5000 public employees, including those university employees not covered by a collective bargaining agreement, will be impacted by this freeze. However, the Board of Regents already established that no across the board increases would be approved for non-covered employees in FY18 so this legislation is not expected to have an immediate impact on the university’s budget. On January 31^st, the House State Affairs Committee held a preliminary hearing on the legislation http://www.akleg.gov/basis/Meeting/Detail?Meeting=HSTA%202017-01-31%2015:00:00

HB 64/SB 27 (Drummond/Dunleavy) – Creates a task force on reading proficiency and instruction; and on the effects of dyslexia on some students. UA would have one representative on the 15 member task force. On January 30^th, the House Education Committee held a preliminary hearing on the legislation http://www.akleg.gov/basis/Meeting/Detail?Meeting=HEDC%202017-01-30%2009:00:00

SB 12 (Bishop) - Institutes an education facilities, maintenance and construction payroll tax. Tax proceeds are intended to be used for the educational facilities maintenance and construction fund (AS 37.05.560) from which money can be appropriated to maintain UA facilities. No House companion at this time.

SB 17 (Costello) – Establishes the Stevens-Inouye Exchange Program, a reciprocal educational exchange between the University of Alaska and the University of Hawaii for students pursuing political science degrees. The program is intended to commemorate and honor the long friendship and productive bipartisan relationship between Republican U.S. Senator Ted Stevens of Alaska and Democrat U.S. Senator Daniel Inouye of Hawaii. No House companion at this time.

Thank you for your continued support of the University of Alaska.

For more information, contact Miles Baker at miles.baker@alaska.edu or visit www.alaska.edu/state

What tools are available for following a legislative hearing? Find out here http://www.alaska.edu/state/sessionandbudget/index.xml

The staff list for the 30^th Legislative Session has now been published http://akleg.gov/docs/pdf/session_phone_list.pdf

January 23^rd, 2017

 

The Capitol Report

 

Miles Baker

Associate Vice President, Government Relations

 

Greetings from Juneau and welcome to the Capitol Report.

 

Last Tuesday, the 30th Alaska State Legislature gaveled-in to begin the first day of their 90-day legislative session here in Juneau. While there are many familiar faces in the building this year, we have an unusually large freshman class of both legislators and staff. Nearly one-quarter of the elected members are new and the House will be led by a bipartisan coalition. It’s clear that the entire legislature will need a little more time than normal to settle in.

 

My name is Miles Baker and I’m the new Associate Vice President, Government Relations. I’m extremely honored to be at the University of Alaska and working on your behalf. It’s my job to advocate for the university’s policy priorities, legislative agenda, and most importantly, our operating and capital budgets. I’ll be based in Juneau for the duration of the session, working out of the office the university maintains in the historic Ebner Building just across the street from the State Capitol.

 

I’ve been working in and around the legislature for over a decade, and have a good understanding of the people and the institution. But this is a huge team effort. I’ve spent the last two months better educating myself about the university, familiarizing myself with our priorities and preparing to represent you full-time here in Juneau. During my orientation I met faculty, staff, students, alumni, and business leaders. Every one of them is a passionate and knowledgeable university advocate who communicated a willingness to devote time and energy to help advance our interests. I hope I can continue to use you as a resource, and trust you will do the same.

 

Over the course of the legislative session, you will be receiving periodic communications from me designed to keep you up to date on important developments in Juneau. When there are opportunities to advocate on the university’s behalf, we want you to know. We’re also in the process of improving the information and resources available on the UA Government Relations webpage www.alaska.edu/state, so please check back on a regular basis. This year, in addition to our FY18 budget, we’ll be working to reauthorize the Technical Vocational Education Program and the Alaska Education Tax Credit. We also intend to raise awareness within the legislature of our critical land trust deficit in the hopes of achieving a near-term resolution at the state and federal level.

 

These are challenging and consequential times for the state and the university. Declines in both oil production and price have resulted in Alaska’s unrestricted general fund revenues dropping from $9.5 billion in FY12 to just $1.4 billion this year and are projected to be only slightly higher in FY18 at $1.6 billion. For the sixth year in a row, the state’s general fund revenues are not sufficient to cover annual operating expenses. Running $3.0 billion annual deficits has forced dramatic reductions in state spending and drawn down the state’s primary savings accounts.

 

Governor Walker’s FY18 budget proposal maintains total spending at roughly last year’s $5.0 billion level. With general fund revenue only expected to cover 32% of those costs, the Governor’s proposal includes a $2.5 billion draw from the permanent fund earnings reserve, a motor fuel tax increase and a two-year salary freeze for non-unionized public employees. Even if these proposals are approved, the state will still have an $800 million structural deficit in FY18. Consequently, the Walker administration has indicated that they expect additional revenue measures to be part of the legislative discussion this session.

 

Advocating for the university’s annual operating and capital appropriations is our most important task. As you know, our budget has been cut by $53 million (14%) over the last three years and we expect continued pressure from the legislature this year. While the Governor’s budget proposal holds our funding at last year’s $325 million level, it’s $16.3 million less than the Board of Regents’ request. The Regents also requested $50 million in capital funds for deferred maintenance. Those funds were not included in the administration’s budget proposal.

 

The House Finance Committees will start operating budget hearings this week. University President Jim Johnsen is scheduled to appear before the committee on Tuesday January 31^st at 1:30pm to present the University’s FY18 operating request. You can stream this hearing online at www.gavelalaska.org or at akl.tv, or watch it on television on 360 North. We will keep you updated as other budget related hearings are added to the calendar.

 

I look forward to working closely with you this year. If you find yourself in Juneau or have any questions, I can be reached at:

 

227 4th Street

(907) 463-3086

 

Thank you

 

Miles Baker

 

Other Resources:

 

Last Wednesday evening, Governor Walker addressed a joint session of the legislature to deliver his annual State of the State. Video and transcript are both available.

 

The legislature is still updating its public information. As it becomes available, we will update the Government Relations website. In the meantime, these recently updated resources are available:

 

Legislators by District  

Legislators Contacts 

Legislators Toll-Free Numbers

Legislators Photos

Committee Assignments

House Finance Subcommittee Assignments

Session Calendar

Legislative Information Offices Directory

BASIS – (Bill Action Status Inquiry System)