A Citizen’s Guide

Gov. Sarah Palin asked lawmakers to save. The industry asked lawmakers to save. Lawmakers asked each other to save.

But the when, where and for what are causing some debate.

For the past 20 days, legislators have been reviewing Palin’s bill for increasing state revenue from oil production, and the issue of what to do with that extra money has been a constant undertone in committee hearings, public testimony and industry advertisements.

In the Senate Judiciary Committee, Sen. Gene Therriault, R-North Pole, gained passage of an amendment to stash as much as half of any surplus into the Constitutional Budget Reserve, created in 1990 to fund budget shortfalls in lean years.

But because one Legislature can’t tell another how to spend money, the amendment is only a recommendation. For that reason, it can be difficult for lawmakers to set a recurring savings plan into place.

Several lawmakers and business groups, including the Alaska State Chamber of Commerce, have asked the Legislature to pass a fiscal plan with any tax increase, something that, because of its complexity, lawmakers have suggested probably won’t happen until the regular session next year.

After much wrangling on Sunday, the House Resources Committee passed an amendment by Rep. Scott Kawasaki, D-Fairbanks, to use a one-time surplus created under the bill as a way to pay the liability associated with the public employees and teachers retirement systems, or PERS and TRS.

During committee hearings the day before, lawmakers introduced several other ideas about what to do with a surplus. Rep. Anna Fairclough, R-Eagle River, unsuccessfully proposed an amendment to put surpluses into a savings account within the general fund, the place for all state revenue not directed elsewhere by the Alaska Constitution or statute.

“We should be, as a committee, making a recommendation on a non-renewable resource to save that resource and allow Alaskans to benefit from it over and over again,” Fairclough said.

Rep. Craig Johnson, R-Anchorage, unsuccessfully tried twice to get lawmakers to put that surplus into the earnings reserve account of the permanent fund instead.

“The fact of the matter is, if it’s in an account someplace, we do have access to it and we do pay very few political consequences to getting that money,” Johnson said. “It’s a simple vote.”

While it takes a 75 percent vote of the Legislature to use money from the Constitutional Budget Reserve, it only takes a 50 percent vote to spend the earnings of the permanent fund.

But Johnson argued money would be safer in the permanent fund because lawmakers, fearing voter backlash, would only tap into it in times of great need or for matters of great importance. Kawasaki and another Fairbanks Democrat, Rep. David Guttenberg, voted against those two amendments.

“The amendment never actually set up a fund that was separate from the general fund, so it was just going into the general fund,” Guttenberg said about the Fairclough amendment.

Guttenberg voted for the Kawasaki amendment and said he wants to see any surplus go into the Constitutional Budget Reserve.

“The Legislature has borrowed a lot of money out of that fund, and we need to pay it back,” Guttenberg said.

The bill is entering the final round of hearings before the House and Senate Finance Committees.

Contact staff writer Eric Lidji at 459-7504.