Governor won't accept 5-year longevity bonus phase-out

Posted: Sunday, May 18, 2003

JUNEAU (AP) Gov. Frank Murkowski has rejected senior citizen groups' offer of a five-year phase-out of the longevity bonus program.

The administration would agree, instead, to a two-year phase-out that calls for seniors to receive a 50 percent reduction in their checks for the next two years. After that, they would not receive them at all, an administration spokesman said.

The Senate last week approved the five-year phase-out of the program, which provides eligible senior citizens with payments of up to $250 a month.

But House Finance Co-Chairman Bill Williams, R-Saxman, held off adopting that proposal Saturday in the House Finance Committee.

Williams said the governor's office has said a five-year phase-out is unacceptable.

The administration would accept a two-year phase-out that calls for seniors to receive 50 percent of their current payments through the 2004 and 2005 fiscal years, said John Manly, a spokesman for Murkowski.

''This all kind of assumes a sales tax is going to pass to be able to afford to pay for any kind of phase-out,'' Manly said.

Marie Darlin, a volunteer lobbyist for AARP in Juneau, was not enthusiastic about the shorter phase-out.

''I think that would be a little hard for us to agree to,'' Darlin told the House Finance Committee.

''It's better than zero,'' Williams countered. ''The governor may zero it out.''

Murkowski in March proposed eliminating the longevity bonus program altogether in the 2004 fiscal year, which starts in July. That would have saved about $44 million, state officials estimate.

An alternative proposal by Senate President Gene Therriault's office would have allowed the bonuses only for low-income seniors.

Currently, there is no limit on the amount of income an older Alaskan can have and still receive the monthly payments, which range up to $250 depending on when people turned 65. Several years ago, the state began phasing out the payments, but grandfathered in seniors living in Alaska who turned 65 by the end of 1996.

The needs-based proposal would have cut off the payments to single seniors making more than $16,824 a year, or couples making more than $22,716. Alaska Permanent Fund dividends and some other sources of income would not have been counted.

Murkowski said he would accept that proposal. But Darlin said many seniors perceived it as welfare and they objected that the income levels were too low, particularly for seniors with high medical bills.

AARP and the Pioneers of Alaska proposed the compromise five-year phase-out approach. That called for the bonuses to be reduced by 20 percent each year until finally ceasing at the end of the 2007 fiscal year.

Manly, Murkowski's spokesman, said he did not know whether the governor would line-item veto funding for the program if that's the bill the Legislature sends him.

''It's obviously a possibility,'' Manly said.

The House Finance Committee took no action on the bill Saturday. Williams said he's not sure what proposal the committee will decide to send to the floor for a vote.

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