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Eye on the Capitol: Week in Review

By Rhonda McBride 5:33 AM January 27, 2014

Analysis: The decisions made in 2014 will likely affect the future of Alaskans for the rest of this century.

JUNEAU – Alaska’s favorite sport had some opening plays during the first week of the 2014 legislative session, marked by a few surprises — but what came as no surprise were signs of partisan fighting.

Kerttula resigns

The resignation of Rep. Beth Kerttula on day one of the session was completely unexpected by many lawmakers. The Juneau Democrat was elected in 1998 and has served as House minority leader for seven years. Kerttula is headed to Stanford for a fellowship, to work on ocean policy for the Pacific Northwest.

It’s the first time in almost five decades there hasn’t been a Kerttula at the Capitol. Her father, Jay Kerttula, had the distinction of being the only lawmaker in state history to serve as both House speaker and Senate president.

Rep. Chris Tuck of Anchorage has since taken over leadership of the House minority.

Now it’s up to the Tongass Democrats, which represents Democrats in Kerttula’s district, to forward the names of three replacement candidates to the governor, who will select one name, which must then be confirmed by the House minority.

The last time a Juneau lawmaker had to be replaced was when Democrat Kim Elton resigned from the Senate to work for the Obama adminstration.

Sarah Palin, who was governor at the time, rejected Kerttula as the Democrat’s choice to replace Elton. Palin came up with her own list of names, which failed confirmation by Senate Democrats. The battle went on until the end of session when former Juneau Mayor Dennis Egan was offered up as a compromise candidate

Kerttula said on Tuesday she had been in touch with the governor’s office and expects him to act quickly on the nominations from the Tongass Democrats. The governor has 30 days from the day the resignation takes effect — which was Friday — to appoint a replacement. Democrats said they’ll announce the list of applicants by this Tuesday.

State of the State Speech focuses on education

Some political observers said Alaskans should look at what was not mentioned in the governor’s State of the State address.

Medicaid was one of those hot button issues.

Democrat Byron Mallott, who is running for governor, took Parnell to task for failing to address it in his speech and called on Parnell to reverse his decision because it leaves 40,000 Alaskans without adequate health care.

Most lawmakers were expecting the governor to devote most of his address to state ownership in a natural gas pipeline, which he did. But he also declared 2014 the “Education Session.” For the most part, his speech focused on education reforms.

The one that’s the most controversial: support for Joint Senate Resolution 9, which would put a constitutional amendment on the ballot to clear the way for state funding of private schools.

Democrats said they could support most of the other reforms, such as the governor’s digital innovation initiative, more support for vocational and technical education, charter schools and boarding schools, as well as scrapping the high school exit exam and substituting other national tests.

But what the governor thought was an olive branch turned out to be a red flag for Democrats, who reacted angrily to his request that they trade an increase in the Base Student Allocation for support of his educational reforms and JSR 9.

In his Wednesday night address, the governor seemed to imply that an increase in the BSA, which is the formula the state uses to decide how much to spend on each student, was tied to a vote on the voucher system resolution.

While Republicans called the governor’s education reforms bold, Democrats called it extortion and bribery.

Following his speech, the governor clarified his position and said an increase in the BSA would not be tied to support for JSR 9. But he suggested the amount of the increase was negotiable.

Governor raises base student allocation

On Friday, when the governor’s education reform package was introduced on the Senate floor, the number that school districts faced with massive layoffs were anxiously waiting to hear was released.

The governor would raise the $5,680 BSA by about $200; a gradual increase over three years.

Republicans called it a good opening move, offered in the spirit of compromise. Democrats said it was only a fourth of what was needed for schools to avert drastic cuts and layoffs.

While Democrats have been longtime champions of an increase in per-student funding, this is the first time in four years the governor has supported such an increase.

Between the two parties, there’s a lot finger pointing, with Republicans saying they’ve increased funding every year for education and the Democrats saying that’s not true.

There’s some political hair splitting: It’s true that Republicans have increased funding for energy, transportation and school construction. But Democrats argue their failure to raise the per-student funding formula amounts to a cut, because it hasn’t kept up with rising classroom costs – mainly the high cost of health insurance.

The governor’s overture may have deepened partisan divisions. Republicans were disappointed Democrats didn’t see the BSA increase as a positive step, while some Democrats believe the governor was playing election-year politics to satisfy his conservative base. Democrats said they could never support public money being used for private schools.

It will take a two-thirds vote of each legislative body to get a measure on the ballot. Republicans claim they may already have the necessary votes, and that some Democrats are inclined to vote with them.

This battle will certainly take up a lot of oxygen.

Or was the governor’s opening gambit like a pressure valve, designed to let off some steam — to get the necessary focus later on some of the other big issues?

With the 2013 session devoted to oil tax reform, the conservative agenda was put on the back burner, because issues such as state funding of abortions and voter identification are issues that that take up a lot of time but often go nowhere.

Legislative leaders from both parties said, going into the session, there’s a lot of pent-up demand among the social conservatives who face re-election and want to have something to show their constituents.

The issue of great importance to the state’s future — which would potentially fund education and all the state’s other pressing needs — took a back seat this week.

The governor’s gas line legislation was introduced on the Senate floor with little fanfare and little reaction, partly because lawmakers from both parties needed time to digest the 49-page bill.

One lawmaker said the sad reality is there are very few of his colleagues who have the background to understand  the complexities of the legislation and its far reaching impact – this includes lawmakers from both parties.

Some big decisions are ahead

The governor’s bill, SB 138, proposes a partnership between the state and gas producers in building a natural gas pipeline — and raises a question which has dogged the state for decades: Can the state be both a partner and regulator of the oil and gas industry?

There are a number of other questions that must be answered in the coming days. There aren’t easy answers.

  • How much equity should the state have in a pipeline?
  • What role will a state-owned corporation play in the project?
  • Should the state tax the net or gross income for gas?
  • Should the natural resources commissioner be allowed to negotiate the contract for the pipeline?
  • Should protections included in the Alaska Gasline Inducement Act (AGIA) be a part of the new agreement?

At first blush, many lawmakers said the legislation is very similar to Frank Murkowski’s ill-fated proposal to build a pipeline, except instead of going from the North Slope to the Lower 48, it now goes to Southcentral Alaska. Back then, Alaskans had no idea the United States would be awash in natural gas and that a better shot at an export market could be found in Asia.

Lawmakers from both parties said the devil is in the details. But every detail is subject to a different interpretation, which will make it very confusing for the public as well as lawmakers who don’t have a long history following oil and gas legislation.

The bottom line is Alaskans all need to pay attention, even if it causes a headache. In the coming week there are at least seven committee hearings dedicated to gas line issues, the first of many more to come.

The decisions made in 2014 will likely affect the future of Alaskans for the rest of this century.

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