Legislature(1999 - 2000)
1999-05-23 Senate Journal
Full Journal pdf1999-05-23 Senate Journal Page 1734 SB 1001 CS FOR SENATE BILL NO. 1001(FIN) An Act authorizing an advisory vote on a long term financial plan for the state; and providing for an effective date was read the third time. Senator Phillips moved that the bill be returned to second reading for the purpose of a specific amendment, that being Amendment No. 1. Without objection, the bill was returned to second reading. Senator Phillips offered Amendment No. 1 : Page 1, line 9 through page 3, line 19: Delete all material. Insert: 1999-05-23 Senate Journal Page 1735 SB 1001 Question Preamble: The people of Alaska created the Alaska permanent fund to save a portion of Alaskas petroleum revenue for the future. After investing those savings, the original intent and purpose was to then use the earnings from those investments when Alaskas petroleum revenues declined. Petroleum revenues have now declined substantially and are forecast to continue to decline. Our reliance upon declining oil production and volatile oil prices constitutes an unsustainable state budget system. The governor and state legislature seek the publics judgment in adopting a stable and sustainable long- term balanced budget plan. Balanced Budget Plan: This will preserve the permanent fund dividend, inflation-proof the permanent fund, support public services, and establish a Citizens Balanced Budget Task Force. Please mark yes or no on this plan. The balanced budget plan will: (1)Spending Reductions: Continue state general fund budget reductions to a combined total of at least $60,000,000 for fiscal years 2000 and 2001. Submit a proposed constitutional amendment to the voters that would reduce the base amount of annual appropriations in art. IX, sec. 16, Constitution of the State of Alaska, and make other changes to establish a meaningful appropriation limit. (2)Permanent Fund Protection: Guarantee the Alaska permanent fund principal is untouched. The principal of the fund is inflation proofed to protect its value for all Alaskans, including future generations. 1999-05-23 Senate Journal Page 1736 SB 1001 (3)Permanent Fund Dividends: Guarantee a dividend is paid to qualified Alaska residents at a minimum of $1,700 in 1999 and $1,700 in 2000 and thereafter, approximately $1,348 and higher. Beginning in 2001, the Constitutional Budget Reserve and the Permanent Fund Earnings Reserve will be combined. In determining the market value for the calculation of the dividend, this new account will be joined with the principal of the permanent fund. After accounting for inflation- proofing, the dividend will be based on 50 percent of the annual earnings payment of these combined accounts. (4)Earnings Reserve Usage for Public Purposes: After payment of permanent fund dividends and inflation-proofing the fund, the remaining annual earnings payment will be prioritized for usage for education, public safety, and transportation. (5)Accountability: Expenditures from the combined account will be fully disclosed on each annual permanent fund dividend check. (6)Balanced Budget Task Force: Establish a Citizens Balanced Budget Task Force to present options to further reduce state spending and identify appropriate future revenue sources. (7)Income Tax: No personal income tax will be required as part of this plan. Question: After paying annual dividends to residents and inflation- proofing the permanent fund, should a portion of Permanent Fund Investment Earnings be used to help balance the state budget? Yes ¦ á No ¦ á Senator Phillips moved for the adoption of Amendment No. 1. Senator Halford objected. 1999-05-23 Senate Journal Page 1737 SB 1001 Senator Halford offered Amendment to Amendment No. 1: In Question, on the first line after the word Fund: Insert at reduced rates, Senator Halford moved for the adoption of Amendment to Amendment No. 1. Objections were heard. The question being: Shall Amendment to Amendment No. 1 be adopted? The roll was taken with the following result: CSSB 1001(FIN) Second Reading Amendment to Amendment No. 1 YEAS: 5 NAYS: 13 EXCUSED: 0 ABSENT: 2 Yeas: Donley, Green, Halford, Taylor, Ward Nays: Ellis, Elton, Hoffman, Kelly Pete, Kelly Tim, Leman, Mackie, Miller, Parnell, Pearce, Phillips, Torgerson, Wilken Absent: Adams, Lincoln and so, Amendment to Amendment No. 1 failed. The question being: Shall Amendment No. 1 be adopted? The roll was taken with the following result: CSSB 1001(FIN) Second Reading Amendment No. 1 YEAS: 12 NAYS: 6 EXCUSED: 0 ABSENT: 2 Yeas: Ellis, Elton, Green, Kelly Pete, Kelly Tim, Mackie, Miller, Parnell, Pearce, Phillips, Torgerson, Wilken Nays: Donley, Halford, Hoffman, Leman, Taylor, Ward Absent: Adams, Lincoln and so, Amendment No. 1 was adopted. 1999-05-23 Senate Journal Page 1738 SB 1001 The bill was automatically in third reading. Senator Parnell moved that the bill be returned to second reading for the purpose of a specific amendment, that being Amendment No. 2. Without objection, the bill was returned to second reading. Senator Parnell offered Amendment No. 2 : Page 1, line 7, Delete: the legislature and the governor. The question shall appear on the ballot in the following Insert: the legislature and the governor. Notwithstanding AS 15.60.005 and other laws relating to preparation of the ballot proposition, the question shall appear on the ballot in the following Senator Parnell moved for the adoption of Amendment No. 2. Senator Halford objected. The question being: Shall Amendment No. 2 be adopted? The roll was taken with the following result: CSSB 1001(FIN) am Second Reading Amendment No. 2 YEAS: 10 NAYS: 8 EXCUSED: 0 ABSENT: 2 Yeas: Donley, Kelly Pete, Kelly Tim, Leman, Mackie, Miller, Parnell, Pearce, Torgerson, Wilken Nays: Ellis, Elton, Green, Halford, Hoffman, Phillips, Taylor, Ward Absent: Adams, Lincoln and so, Amendment No. 2 was adopted. The bill was automatically in third reading. 1999-05-23 Senate Journal Page 1739 SB 1001 Senator Taylor moved that the bill be returned to second reading for the purpose of a specific amendment, that being Amendment No. 3. Without objection, the bill was returned to second reading. Senator Taylor offered Amendment No. 3 : Page 3, between lines 19 and 20, insert: Plan C Description Summary of Plan: Plan C is based on restructuring government to eliminate waste and provide essential services. Plan C uses the Constitutional Budget Reserve Fund to balance the budget for FY99, FY00, FY01, and FY02 and at the same time embark on a comprehensive revenue enhancement program. Begin an aggressive multi-use land sales program to generate a long term enhanced revenue stream. Embark on an aggressive timber sales program utilizing innovative marketing strategies with emphasis on value added product. Remove present statutory barriers to encourage new oil exploration by independent companies. Plan C does not touch the permanent fund dividend nor the permanent fund earnings. Plan C does not impose an income tax nor an increased gasoline tax. (1)Land Sales - Beginning year 2000, market 250,000 acres of land and each year thereafter. Year 2001 down payments and prior years annual payments will generate over $231,201,100; year 2002 revenues of $325,725,200; and increases each year thereafter approximately $75,000,000 per year. (2)New oil revenues: FY2002 projected at $5,700,000; FY2003 projected at $14,200,000; FY2004 projected at $18,600,000; FY2005 projected at $22,900,000; FY2006 projected at $29,700,000; FY2007 projected at $33,200,000; FY2008 projected at $78,700,000; FY2009 projected at $127,900,000; FY2010 projected at $147,300,000. These revenues are anticipated to continue increasing through the year 2019. 1999-05-23 Senate Journal Page 1740 SB 1001 (3)New Oil revenues from independents: FY2002 projected at $222,390,000; FY2003 projected at $226,830,000; FY2004 projected at $211,770,000; FY2005 projected at $223,230,000; FY2006 projected at 215,190,000; FY2007 projected at $209,460,000; FY2008 projected at $216,750,000; FY2009 projected at $215,520,000; and FY2010 projected at $221,340,000. These revenues are expected to continue on the incline through the year 2020 and beyond. (4)State Corporations: $100,000,000 dividend each year. (5)Reduce Spending by $50,000,000 per year for 5 years. (6)Other New Revenue from new business and other resource development $35,000,000 beginning year 2000. FY2001 projected at $100,000,000; FY2002 projected to be $103,000,000 and FY2003 projected at $106,100,000. This growth is projected to continue upward at a rate of approximately $3,000,000 per year. Plan C Yes ¦ á Plan C No ¦ á Renumber following sections accordingly. Senator Taylor moved for the adoption of Amendment No. 3. Objections were heard. The question being: Shall Amendment No. 3 be adopted? The roll was taken with the following result: 1999-05-23 Senate Journal Page 1741 SB 1001 CSSB 1001(FIN) am Second Reading Amendment No. 3 YEAS: 6 NAYS: 12 EXCUSED: 0 ABSENT: 2 Yeas: Donley, Green, Halford, Leman, Taylor, Ward Nays: Ellis, Elton, Hoffman, Kelly Pete, Kelly Tim, Mackie, Miller, Parnell, Pearce, Phillips, Torgerson, Wilken Absent: Adams, Lincoln and so, Amendment No. 3 failed. The bill was automatically in third reading. The question being: Shall CS FOR SENATE BILL NO. 1001(FIN) am An Act authorizing an advisory vote on a long term financial plan for the state; and providing for an effective date pass the Senate? The roll was taken with the following result: CSSB 1001(FIN) am Third Reading - Final Passage Effective Date YEAS: 10 NAYS: 8 EXCUSED: 0 ABSENT: 2 Yeas: Kelly Pete, Kelly Tim, Leman, Mackie, Miller, Parnell, Pearce, Phillips, Torgerson, Wilken Nays: Donley, Ellis, Elton, Green, Halford, Hoffman, Taylor, Ward Absent: Adams, Lincoln and so, CS FOR SENATE BILL NO. 1001(FIN) am failed. Senator Mackie gave notice of reconsideration.