Last Minute Wrangling Mars End of Session
Caucus pleased with successes despite flawed process

Juneau - While praising passage of landmark legislation that could eventually lead to an Alaska natural gas pipeline, members of the Senate Republican Caucus expressed disappointment at end-of-session conflicts over funding for revenue sharing, education and the retirement systems that snarled an orderly adjournment.

“Unfortunately we ended with what the media labeled ‘legislative chaos of the worst kind.’ This seems to have stemmed from a lack of communication between the Senate leadership and the House of Representatives and is likely to overshadow some of the good work that was accomplished this year,” said Senate Minority Leader Gene Therriault, R-North Pole.

Caucus members were pleased with passage of a comprehensive ethics package that addresses lobbying and disclosures laws in both legislative and executive branch ethics statutes, and with enactment of an omnibus anti-crime bill that makes a number of statute changes relating to the state’s legal, correctional and public safety systems.

Members of the caucus voiced concern over the size and sustainability of the capital and operating budgets.

“We can whistle past the graveyard, but the fact is, we are going to pay the piper here very soon, and we need to figure out how we are going to fill fiscal gaps. Those will come sooner than later if budgets grow at 20 or 25 percent,” said Sen. Gary Wilken, R-Anchorage, who served from 2003 to 2006 as co-chairman of the Senate Finance Committee.

Escalating budgets also give rise to the need for a long range fiscal plan, which was proposed by Sen. Fred Dyson, R-Eagle River, but stalled in the Senate Finance Committee this year.

“I was very disappointed that the Senate chose not to discuss or implement a long-term fiscal plan. With the information we now have, we know that we are probably going to be in a deficit budget situation at least a year from now, and I consider that to be irresponsible,” Dyson said.

Equally disappointing was the lack of legislative action on a bill that would have required school districts to define “unexcused absence” and provide interventions for truancy.

Senate Bill 31 was pre-filed by Sen. Con Bunde, R-Anchorage, in January, but never moved from its first committee of referral.

“Reducing truancy is important not only because we want our children to stay in school, but it’s also closely related to juvenile crime. The attorney general’s office informed me today of the strong correlation between truancy and the rate of murder because so many truants are also vulnerable as runaways. I have great hopes that next year the committee process will work and we’ll be able to move the truancy bill forward.”

Also left on the table was Senate Bill 80, which would have prevented oil companies from deducting costs of repairs due to lack of maintenance or improper maintenance of property or equipment.

“We fought the good fight and we didn’t get the bill cleared through the process, we’ve got next year, maybe we’ve got a special session, we’ll just have to see what comes down,” said Sen. Tom Wagoner, R-Anchorage.

Therriault also noted that a bill he pre-filed in January that would have tightened security measures pertaining to personal information and addressed the increasing risk of identity theft never received a single hearing.

Bill Strengthens Child Prostitution Laws
Omnibus bill includes Dyson’s SB 157

Juneau - Sen. Fred Dyson, R-Eagle River, announced that a bill he sponsored, Senate Bill 157, has been amended into House Bill 90, which passed the Senate today.

SB 157 increases the crimes of prostituting a child to felonies, thus increasing the jail time, fines and providing forfeiture of property used in these horrendous crimes against children. Including the SB 157 provisions, HB 90 also now makes the employment of a prostitute a crime in state law. This is the first “John Law” in Alaska statutes.

“Prostitution and trafficking children is all too common in Alaska, and scores of children are being prostituted in Alaska each year. The impact on the children is devastating and it is way past time we put the predators in prison for long stretches,” Sen. Dyson said.

Sen. Dyson’s legislation is based upon recommendations from the Federal Trafficking in Persons Task Force in Alaska.

Sen. Dyson said more work needs to be done, including finding safe, secure housing and treatment for the children show are victims of prostitution. Prostituting children is very lucrative and the pimps are a great danger to the children. The legislature appropriated $52,000 this year for security equipment at the proposed housing unit at the new Salvation Army facility in Anchorage.

State authority for the state to take custody of prostituted children and money for housing and treatment will be a project for the summer and fall, Sen. Dyson said.

The House is expected to approve the amended bill in the next two days.

Wilken Decries Late Release of Education Funding Plan
SB 178 introduced with four days left in session

Juneau - Sen. Gary Wilken, R-Fairbanks, issued the following statement regarding the introduction today of Senate Bill 178, which makes fundamental changes to Alaska’s public K-12 education funding.

“I am appalled that a complicated adjustment to the State’s funding of public education, our single largest budget expenditure, has been rolled out on a Saturday night, with one committee of referral and four days left before the end of session. This proposal makes sweeping changes to the amount we spend per student, the amount of the local tax contribution, and the services we provide our intensive needs students.

“If the formula foundation needs to be adjusted, bring it out from behind closed doors, adjust it in public, and with respect for the process. At a time when this building should be ultra sensitive to public perception and conducting an open, public process, it is outrageous to me that Senate leadership has chosen to adjust the K-12 formula behind closed doors and without public input.

“As introduced today, this proposal either ignores or grossly under funds those intensive needs students who are most in need of state assistance, and increases property taxes between $80 million and $90 million in Alaska’s communities.”

SB 178 was introduced by the Senate Finance Committee.

Sound actualities can be downloaded from the following links:
http://www.aksenateminority.com/media/25/wilken2007051201a.mp3
http://www.aksenateminority.com/media/25/wilken2007051202a.mp3

Caucus Tries to Boost Pipeline Assessment Funds
Majority coalition fails to add $2.5 million

Juneau - The Senate Republican Caucus tried unsuccessfully today to add $2.5 million from a crude oil production surcharge to fully fund an independent appraisal of the state’s oil and gas infrastructure.

“Fully funding the risk assessment at $5 million is essential for establishing a credible independent appraisal of the condition of Alaska’s oil and gas infrastructure and its ability to safely operate for another generation,” said amendment sponsor Senate Minority Leader Gene Therriault, R-North Pole. “The integrity of our oil and gas systems must be sufficient to protect Alaska’s environment and ensure uninterrupted production and revenue to the state.”

The amendment to Senate Bill 53 would have added $2.5 million from the Oil and Hazardous Substance Release Response Account to fully fund a comprehensive oil and gas infrastructure risk assessment. The Governor asked the Senate Finance Committee to add the full $5 million, but the committee included only half the needed amount, $2.5 million in general funds.

“Partial funding reduces the scope and thoroughness of the project and leaves the State and industry without an adequate appraisal of the condition of Alaska’s oil and gas infrastructure,” Therriault said. “Full funding is necessary to adequately assess the systems on the scale proposed, and to be able to attract independent nationally recognized firms that have the expertise and capacity to do the work.”

The project would include a comprehensive risk assessment of Alaska’s crude oil production, storage and transportation system including the Trans Alaska Pipeline and Valdez Marine Terminal. It will also evaluate the extent, degree and adequacy of government oversight and make recommendations for continued safe and reliable operation of the system.

This would be the first system-wide risk assessment of Alaska’s complex oil production and transportation system and is anticipated to take from two to three years to complete.

“A thorough, independent appraisal of the condition of the state’s oil and gas facilities is needed to identify the greatest risks of failure; what’s in good shape; what’s not; where, and how serious the risks are,” Therriault said.

“At a time when the U.S. Congress is holding hearings on the maintenance problems and integrity of the Alaska oil and gas system, I am disappointed that members of the majority coalition were unable to vote their conscience to fund this full appropriation,” Therriault said.

The Senate failed to adopt the amendment by a vote of five to 15, along straight caucus lines. The bill now goes to the House for consideration.

A sound actuality can be downloaded from the following link:
http://www.aksenateminority.com/media/25/therriault2007051201a.mp3

Bill Bars Deductions for Improper Maintenance
Senate passes Wagoner’s SB 80

Juneau - The Senate unanimously passed a bill today preventing oil companies from deducting costs for repairs due to lack of maintenance or improper maintenance of property or equipment.

“This bill has finally made its way through the Senate, three months after it was introduced in February,” said bill sponsor Sen. Tom Wagoner, R-Kenai. “I’m extremely concerned that there is not enough time left this session for the bill to be properly considered in the House and adopted this year.”

Wagoner’s bill has companion legislation, House Bill 128, sponsored by Rep. Kurt Olson, R-Soldotna, which has also faced an uphill battle despite being sponsored by 20 of 40 representatives.  Typically, the active bill (SB 80) is directed to the same committee as the companion bill – which would be House Finance.

But Wagoner notes that this is very late in the session, with only 7 days left, and he is uncertain whether the House Finance Committee will have time to address the bill.

“Since this bill was so late in passing the Senate, I’m hopeful the House will be able to schedule it in their Finance Committee,” said Wagoner.  “Otherwise, we will probably have missed our window of opportunity and it could cost the state tens of millions of dollars with just the recent Prudhoe Bay incident.”

For the purpose of determining the value subject to tax, the petroleum production tax enacted through House Bill 3001 in August of 2006 allows producers to deduct costs associated with the production of oil and gas from the gross value at the point of production. Senate Bill 80 prevents oil companies from deducting expenses resulting from improper maintenance. Similar language was offered as an amendment when HB 3001 was under debate in the Special Committee on Natural Gas Development in August, but failed by a vote of 5 to 7.

Fact Sheet Attached.
http://www.aksenateminority.com/pdfs/25/sb0080.pdf
Please Note: A sound actuality by Sen. Wagoner can be downloaded from the following link:
http://www.aksenateminority.com/media/25/wagoner2007051001a.mp3

Senate Republican Caucus Reacts to Indictments
Charges reflect poorly on institution

Juneau -  The Senate Republican Caucus expressed disappointment at news today that two former legislators and one sitting legislator have been indicted on federal charges that include extortion and bribery.

“We are saddened and disappointed on behalf of the institution we represent by news of these indictments today. This strikes at the heart of the purity of the process for setting public policy that takes place in our branch of government, the legislature,” said Senate Minority Leader Gene Therriault, R-North Pole.

Sen. Therriault was one of the leading proponents for a higher PPT tax rate during debate last year. As chairman of the Legislative Budget and Audit Committee for 2005-2006, Sen. Therriault hired several consultants who questioned why the administration was proposing a 20 percent tax rate when its own advisor, Dr. Pedro Van Muers, had earlier recommended starting deliberations at a rate of 25 percent.

“These indictments illustrate the type of forces we were up against in the debate during PPT last year. We suspected something like this might be going on behind the scenes, but we had no proof,” Therriault said.

A sound actuality can be downloaded from the following link:
http://www.aksenateminority.com/media/25/therriault2007050401a.mp3