Legislators form caucus to work on long-term fiscal plan

Posted: Wednesday, March 28, 2001

JUNEAU (AP) -- Half the House of Representatives showed up at the first public meeting of a group planning to work on a long-term fiscal plan for the state.

The group's aim is to stir up public discussion of the state's long-term budget problems, debate various ideas and eventually come up with a plan people can support.

Rep. Bill Hudson, R-Juneau, said the group's meetings will be open and bipartisan, adding that none of the state's big accomplishments, including setting the Permanent Fund, were done without bipartisan support.

''It is going to require all the people of the state of Alaska buying into the solution,'' Hudson said.

Hudson, Rep. John Davies, D-Fairbanks, and the only senator to attend, Alan Austerman, R-Kodiak, were chosen as co-chairmen.

The group, which is calling itself the Fiscal Policy Caucus, is concerned about the gap between the state's expenses and its long-term revenues, Hudson said. For several years the state has been filling a budget gap by withdrawing money from a state savings account, the Constitutional Budget Reserve.

About $2.85 billion remains in the account. The Department of Revenue estimates that at current state spending levels, the account will be gone in December 2005.

''As difficult as it might be, there are many, many, many choices out there that we need to take a look at,'' Hudson said.

He has introduced one bill that would impose a state income tax and another that would use part of the Permanent Fund earnings to fund state government, but Hudson said he won't just push his own ideas on the group.

The caucus plans to appoint subcommittees to look at options that range from sales taxes to changes in oil taxes to government efficiencies to doing nothing.

''I don't know where this is going to take us -- none of us do, I don't believe -- but we're ready for some bold recommendations on the part of the public,'' Hudson said.

Some members of the group said its formation stems from impatience with legislative leaders' lack of action on a long-term fiscal plan.

''We're not just going to sit around and wait anymore,'' said Rep. Andrew Halcro, R-Anchorage.

Thirteen Republicans and eight Democrats attended the meeting.

No members of the Republican majority leadership in the House or the Senate attended the meeting, but Hudson said the noon time conflicted with a leadership meeting.

House Majority Leader Jeannette James, R-North Pole, has been among advocates of a long-range plan. House Speaker Brian Porter, R-Anchorage, said he generally supports what the group is trying to do and would have attended the meeting if he hadn't had a conflict.

''The issue itself is controversial, to say the least, and there are a multitude of opinions floating around, including my own, on what should be the first emphasis,'' Porter said.

''What I see this group doing is starting the discussion that hopefully will lead a majority of our state residents to recognize that we have a problem that is inevitable and that the time to start working on it is now rather than later.''

Senate Minority Leader Johnny Ellis, D-Anchorage, and Senate Majority Leader Loren Leman, R-Anchorage, said they didn't know they were invited. Hudson's office said all legislators are welcome to attend. The group meets next at noon Friday.

In a 1999 advisory vote, the public overwhelming rejected the Legislature's last attempt at a long-term fiscal plan, which called for spending Permanent Fund earnings. Some legislative leaders have said it's fruitless to try to push another fiscal plan on the public until citizens are ready for it.

Halcro said legislators need to take the lead on that.

''They're never going to be ready until we start talking to them,'' he said.

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