SB 145-LEGISLATOR RETROACTIVE PER DIEM  3:59:39 PM CHAIR SHOWER announced the consideration of SENATE BILL NO. 145 "An Act relating to per diem for legislators; and providing for an effective date." 4:00:17 PM SENATOR ROGER HOLLAND, speaking as sponsor of SB 145, read the sponsor statement into the record: [Original punctuation provided.] In 2018, the legislature passed an ethics reform bill in HB 44. This legislation was deemed substantially similar to a citizen's initiative signed by over 40,000 Alaskans Removing the issue from the ballot. One of the key components of the initiative was to end per diem payments if a budget had not been passed by the end of the 121-day session, and not to allow per diem payments to resume until after a budget had been passed. The public reportedly viewed this provision as an incentive for legislators to finish their work without subjecting government employees to the uncertainty brought on by perpetual pink slips. To the dismay of many supporters of the initiative, legislative council later decided that legislators could receive retroactive back-pay for their missed per diem payments once the budget passed. This apparent circumvention of the process strikes many voters as dishonest and erodes public trust. Very simply, the lack of per diem payments provides an incentive to finish our one true job of providing a budget in a timely fashion before the end of the regular session. Allowing either per diem payments or retroactive per diem payments creates an incentive to not pass a budget on time. SB 145 seeks to remedy the situation by prohibiting retroactive per diem payments after a failure to pass a budget during the regular session and disallowing per diem payments to resume until after a budget is passed. I believe this bill takes a step toward restoring that public's trust and aligns the law with the intent of the citizens. 4:02:27 PM SENATOR HOLLAND presented the sectional analysis for SB 145. [Original punctuation provided with some formatting changes.] Sec. 1  Amends AS 24.10.130(b), relating to legislative per diem, to prohibit the retroactive authorization of per diem for legislators beginning the day after the 121st day of the legislative session until the day a fully funded operating budget is passed by the legislature. Sec. 2  Provides for an immediate effective date. 4:03:02 PM SENATOR HOLLAND summarized that the fiscal impact of SB 145 is indeterminate because nobody knows how many days it will take to pass an operating budget after the 121st day of a regular session. He added that enacting this legislation will result in savings because per diem would not be paid after day 121. CHAIR SHOWER offered his belief that this would not be an additive cost. SENATOR HOLLAND said the simple reading of the statute is that legislators are not entitled to per diem after day 121 if the budget has not passed. SB 145 clarifies that per diem may not be paid retroactively. 4:04:42 PM SENATOR REINBOLD said she likes the bill and it matches the intent of the ballot initiative. CHAIR SHOWER commented on learning about the ballot initiative and per diem when he was a freshman legislator. He expressed appreciation that SB 145 clarifies and codifies what happens. 4:07:06 PM SENATOR HOLLAND commented that the legislature paid per diem retroactively but has not been honoring the statutory PFD. He opined that SB 145 will go a long way toward putting faith and confidence back in the legislature. CHAIR SHOWER said this puts downward pressure on legislators to do the right thing. 4:09:12 PM CHAIR SHOWER held SB 145 in committee for future consideration.