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Robert L. “Bob” “Orpalo” “Tudoc” Valerio, 85, died June 30, 2019, in Seattle.
Public hearing: Residents speak on proposed state budget

Daily News Staff Writer

Saturday afternoon Rep. Dan Ortiz, I-Ketchikan, fielded a public hearing at the Ted Ferry Civic Center as part of the House Finance Committee's efforts to hear from Alaskans about Gov. Mike Dunleavy's proposed budget.

About 150 people floated in and out of the nearly two-and-a-half-hour event which focused on the opportunity to comment on the cost of a Alaska Permanent Fund dividend for 2019.

Dunleavy's proposed budget involves about $1.6 billion in cuts and revenue transfers. He has proposed cuts to a plethora of essential services including health, education and the Alaska Marine Highway System.

Ortiz presented three slides before the start of public comment. One of the slides showed how much the budget needed to be cut to have a $3,000, $1,600 or a $630 PFD.

For a $3,000 PFD, the Legislature would need to find $1.5 billion in cuts. To maintain this year’s funding without increases for healthcare or inflation, there would be $400 million left over for PFDs, a payout of $630, according to information provided at the hearing.

"Ultimately the decision this year really is what (services) do we add back and what are we willing to add back at the expense of the $3,000 PFD," said Ortiz.

Nearly 50 people gave testimony, including both the city and borough mayors. Most people spoke in favor of a reduced PFD in exchange for maintaining services.

"I think it's unquestionable that there will be a fast and a terrible economic hit to this community if this budget proceeds the way that the governor has outlined," said Borough Mayor Dave Landis.

"It's hard to look at all these cuts in favor of getting a full dividend," said Ketchikan City Mayor Bob Sivertsen.

But, the tone shifted to long-term solutions.

"This has been coming for a long time," said local school teacher Rebecca King. "So, for you, as our representative, take my check, take all of it if you need it, but we need a better long-term solution. I'm willing to pay, but it's not going to happen forever."

About 20 people who spoke said they would be in favor of a state income tax. Out of the few people who were in favor of the cuts, half of them expressed support for an income tax.

Ghert Abbott, a life-long Ketchikan resident who ran this past fall against Ortiz to represent Ketchikan, described a reduced PFD as an "aggressive tax" that will "further depress the local economy."

He called for "the full restoration of the progressive income tax that Alaska had before the oil boom."

A few others expressed concern that removing the PFD would hurt poorer families and thus suggested a needs-based PFD payout.

"While I might be able to afford not to get it, I know many low-income families that count on it, they don't have oil in the winter time (without) that permanent fund," said Borough Assembly Member Susan Pickrell.

About 10 people expressed dissatisfaction over the oil tax credits.

"Oil taxes first of all are, I think, purposely confusing," said Ortiz, "They just are."

He said he doesn't expect oil taxes to come up for reform this legislative session.

"However there's more and more attention being brought forward in meetings like this by the public on oil taxes," said Ortiz.

At the start of the hearing he was focused on how the PFD plays into the budget this year.

"Should we be looking at an alternative source of revenue? Yeah, we should. And we probably will in the future," said Ortiz. "Any alternative revenue measure that we might adopt in the future, that’s not going to have any impact in this fiscal year."

Ortiz let everyone know about the next opportunity to have their voices heard regarding the budget. The House Finance Committee will be gathering testimony on the budget from 7:30 to 8:30 p.m. Tuesday at the Legislative Information Office.

 During public comment, laughter and applause broke out when Ketchikan resident Kathy Bolling said, "I want to make it clear to the Dunleavy administration that it's not like you have a room full of Democrats that showed up in Ketchikan concerned about this. There are conservative households who are really concerned about the Dunleavy budget. And the person who put it together – I have eggs in my refrigerator that have been in Alaska longer than she has."

She added: "The PFD. It is my money, and I want you to invest it."