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By ZACHARY HALASCHAK
Daily News Staff Writer
Two weeks is all that separates Alaska from a government shutdown.
As a special legislative session created by Gov. Bill Walker came to a close Friday, a new one was immediately convened at 1 p.m. that same day, beginning an anxious countdown to the July 1 budget deadline.
Walker formed the new special session in order to give the primarily Democratic House and the Republican-led Senate time to compromise and come up with a budget for the state before the end of the fiscal year.
The new special session will be focused solely on establishing an operational budget.
“Compromise is required to protect Alaskans, our economy, and our future,” Walker said in a statement Friday morning. “To ensure government services will continue after July 1, I am calling the Legislature back in – initially to focus on the operating budget.”
Sen. Bert Stedman, R-Sitka, told the Daily News that he was frustrated with how protracted the legislative process has been. He said that although he does think an agreement will be reached before the July 1 deadline, he doesn’t think there will be an agreement in the immediate future.
“My expectation is that this does get close to the deadline, maybe three or four days,” Stedman said. “We have challenges we are working through, but we are nowhere near crisis mode in our cash position.
“We want the distractions off the table,” Stedman said, pleased that Gov. Walker stuck with the Senate’s recommendation of limiting the new session to only the operational budget.
Rep. Dan Ortiz, I-Ketchikan, in a sense agreed, saying that coming up with a workable budget is of key importance right now. He said the new session was “in recognition that we need to take care of our primary function, which is to pass the budget."
This second special session comes after weeks of disagreement and strife among leadership in both chambers. The House adjourned the first special session late Thursday night after pushing through a take-it-or-leave-it budget proposal.
The budget the House passed would have reversed the Senate's $69 million cuts to education and would have restored the Alaska Permanent Fund dividends. The budget also forced the Senate’s hand by leaving them no other option but to accept or reject the controversial budget.
The Senate didn’t even hold a vote on the House’s proposal.
In a press release Thursday night, Senate President Pete Kelly, R-Fairbanks, called the House’s actions “unprecedented.”
“We are deeply disappointed in the House majority's actions tonight,” Kelly said. “Contrary to the House majority's rhetoric, their budget and adjournment tonight does not avert a government shutdown, but forces the Legislature into an additional special session that adds costs, grows uncertainty for the public and private sectors, and further hampers the ability of the two bodies to reach a compromise.”
Kelly further condemned the House's actions, adding that there had been time Friday to come to a better agreement and that by adjourning early the House left no room for compromise on Friday.
“Time allowed for a compromise with the Senate on this budget,” Kelly said. “The House and Senate could have reached an accord at any time tomorrow – the last day of the special session – and passed a budget, together, for all of Alaska.”
In a statement Friday, Ortiz explained that the House budget passed Thursday was not necessarily intended to end discussions with the Senate, but rather be a starting point for future ones.
"The fact that my coalition sent a budget over to the Senate does not preclude more negotiations with the Senate," Ortiz wrote. "This is not an exit strategy — it's a jumpstart for the stalled budget process."
Casey Steinau, who is chair of the Alaska Democratic Party, issued a statement blaming Republicans in the Senate for failing to negotiate with the House.
“The Alaska GOP Senate majority is the reason Alaska still hasn’t passed a budget, putting our state employees and teachers at risk,” she wrote. “The Alaska Senate Republican majority adjourned today, the final day of a 30-day special session without allowing for debate or voting on the budget that passed the Alaska House of Representatives last night.”
Stedman blasted the House’s last-ditch proposal, calling it “imprudent management.”
“We have a new group in the House who haven’t gone through this process,” Stedman said. “The budget we turned down today would have impacted the Alaska Permanent Fund by $4.9 billion.”
Following news of the new session, Ortiz reemphasized that he is fully committed to making sure the government of Alaska does not shut down.
“I as an individual legislator am going to do all that I can to avoid a government shutdown,” Ortiz told the Daily News.
“I'm very aware of the impact a government shutdown would have on the fishing industry, and other key parts of our Southeast economy," Ortiz wrote in the statement. "Lawmakers need to prioritize Alaskans over multinational oil corporations, and stabilize Alaska's fiscal future for families and small businesses."
Stedman also described how detrimental a shutdown would be to the community, saying that, “we are just now getting into the main calendar months of our fisheries.”
He also warned that a shutdown would cost the state $400 million.
There are two weeks in this new special session. Lawmakers have until July 1 to come to an agreement, or the government, minus essential services, will shut down for the first time in Alaska's history.
Some of those non-essential services that would be affected include the Alaska Marine Highway System, state salmon hatcheries, and the Division of Motor Vehicle operations. In addition, some 18,000 state employees would be temporarily laid off come July 1.