The Senate adjourned Tuesday without passing a budget, leaving a narrow window for a last-minute deal before the end of the regular session at the end of the day Wednesday.
The two chambers are hoping to avoid a special session but have been split over the size of the Permanent Fund dividend and whether to dip into state savings.
Republican-led House leaders have proposed a $2,700 PFD and a boost in school funding that would require a large draw from state savings. The bipartisan majority Senate has favored a more modest $1,300 PFD that doesn’t require dipping into savings with current oil revenue projections. Sen. Bill Wielechowski, D-Anchorage, said the PFD has been the main topic of discussion.
“I think we want as big a dividend as possible. The question is: How do you pay for it?” said Wielechowski.
The Senate bill also proposes a significant increase to the amount of funding paid to public schools per student but only contains minimal capital projects.
Senate President Gary Stevens said the leaders of both chambers had been meeting frequently in recent days. The Kodiak Republican said he planned to meet again Tuesday evening to come up with a deal so that the Senate can pass the budget to the House on Wednesday.
“We’re hoping to hear from the House between now and tomorrow’s meeting and hoping we find a compromise we can all live with,” he said.
Stevens said some members of the bipartisan majority caucus had signaled they would be willing to dip into the state’s Constitutional Budget Reserve, but not at the levels the House had proposed.
Wielechowski said House leaders have said they were interested in a spending cap and adding the PFD payment to the constitution.
“We said, ‘Send them over’” he said. “There’s just some timing issues and their ability to get them to us.”
The House already passed a budget, but failed to get the three-quarter majority it needed to dip into the budget reserve for the hundreds of millions of dollars that weren’t funded. That left its provisions for a big jump in education funding and a $2,700 PFD unfunded.
House leaders were in session for much of the day Tuesday and weren’t available to comment.
Stevens said he’s also been meeting with Gov. Mike Dunleavy, who has traditionally favored an even larger PFD payment but so far has been silent about whether he would sign off on a lower amount.
“He’s actively involved,” said Stevens. “He wants to get out here as well.”
With only a day left in the session, agreeing on a budget through a conference committee is no longer an option.
The only way the Legislature can pass a bill by midnight Wednesday to fund the government is if the House votes to approve the Senate’s budget. If the chambers come up with a deal and the Senate advances it, the House could approve the bill Wednesday in what’s known as concurrence.
It’s a longshot as the House and Senate haven’t concurred on a budget since 1982.
If a deal fails, Dunleavy would likely call the Legislature into a special session. It’s unclear when that would happen and how many days it would last. Stevens said he heard rumors that it would not be until June, which would make a tight timeline to fund government operations before the next fiscal year that starts on July 1.
For now, he said, he’s laser-focused on getting a budget deal before the end of the regular session.
“I’m not too concerned about other bills right now,” he said.