Senate takes dim view of House package

Posted: Thursday, May 06, 2004

JUNEAU A late-night spending frenzy by House lawmakers that led to a $236 million school and road construction bond package may have been for nothing, Senate President Gene Therriault said Wednesday.

Just as the Senate was poised to consider a constitutional amendment to cap state spending, House lawmakers loaded up two massive bond bills that included new rural schools, major maintenance for schools around the state and some coveted road projects.

The projects were approved with strong support from both House Majority Republicans and Minority Democrats during a late night session that ended early Wednesday morning.

But Senate Majority Republicans have said all session that such lavish bond packages aren't going to move this year, Therriault said.

With six days left until Tuesday's adjournment and a vote on a fiscal plan aimed at closing future budget shortfalls still pending, nothing has changed in the Senate, Therriault said.

''It's too much spending and we've indicated to them we are trying to keep an eye on the bottom line,'' he said.

The House included a $143 million bond package to build four new rural schools, provide maintenance for schools in Anchorage, Fairbanks and elsewhere and another $53 million for the University of Alaska.

House lawmakers also loaded up a $93 million road and harbor bond package with $24 million for Anchorage, including a much needed Lake Otis and Tudor intersection upgrade.

Gov. Frank Murkowski has set his sights on using $75 million from the Alaska Student Loan Corp. bonds to fund the state's fiscal 2005 capital budget.

The corporation had planned to return a total of $175 million back to the state in the next two years that the state could use for construction projects.

But House Republicans voted 34-5 to go ahead and use the bulk of the Alaska Student Loan Corp. money this year to fund the projects.

The spending plan is likely to end up as a bargaining chip in adjournment talks between the House and Senate, said House Speaker Pete Kott, R-Eagle River.

Kott said he hopes to entice some in the Senate who might want some of the projects from the lengthy list into breaking a deadlock over a constitutional amendment that would let the state begin closing its chronic budget shortfalls using a portion of the permanent fund.

The permanent fund proposal that already has been approved in the House could mean more than $500 million for state coffers. But without legislative action to put the question before voters, it's unlikely the Murkowski administration will approve the school and road spending.

The House approved an amendment that would convert the permanent fund to an endowment that would make 5 percent of its five-year average value about $1.3 billion available each year.

Both the permanent fund amendment and another to cap state spending are locked in the Senate where they lack a required two-thirds vote to win passage.

House Majority Leader John Coghill, R-North Pole, characterized the bond bills as more of a wish list for lawmakers.

''This is probably more of a target than a reality,'' said Coghill, who voted against the measures.

The bills emerged quickly after closed door meetings Tuesday between House Republicans and Minority Democrats. Lawmakers were still adding projects to the list as the clock struck midnight.

Now they go to the Senate where they would have to be added to the fiscal 2005 construction budget before lawmakers leave town for the year.

But Therriault said he does not expect the bond bills to be part of any end-of-session negotiations with House Republicans.

''We've been very consistent in our message to them that we think it's imprudent to have a big bond package this year or a big spending package,'' Therriault said.

Still, Kott said he wasn't detoured by Senate Republicans dismissing the bond bills as ''dead on arrival.''

''I've been around here way too long to recognize anything being dead on arrival until it takes its last gasp,'' Kott said.



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