Walker plans for better relations with Legislature

What a long, strange trip it’s been — and that was only year one.

In his first year in office, Gov. Bill Walker faced unprecedented state budget deficits; an obstinate Legislature, which would eventually sue him; an historic presidential visit; and an oh so precarious state economy, all the while trying to put his mark on an immense natural gas pipeline project led by three of the largest companies that has for years been his overwhelming desire for Alaska.

Despite those challenges and countless others, some self-inflicted, Walker still embraces the gubernatorial post.

“There’s really no part of it I haven’t enjoyed,” Walker told the Alaska Journal of Commerce during a Dec. 22 interview. “It’s been tough — the budget, the financial stuff has been tough — but that’s not deterred me. Sometimes I’ll come home late at night and my wife (Donna) will ask me, ‘Are you still happy to be governor?’ and I say, ‘Yes, I’m still happy to be governor.’”

As he noted, today’s Alaska is much different than the one Walker thought he would be leading when he announced his second run at the state’s high office in 2013. Then, the price for Alaska North Slope crude averaged more than $100 per barrel for the entirety of 2013, the only year that has happened. Now, Alaskans are all too aware of where that market has gone and what it has done to the state.

Then, Walker thought he would be running as an Independent with an Independent running mate. Now, he has a Democratic lieutenant governor in Byron Mallott after the two combined their tickets.

Then, the Alaska LNG Project was still a pipe dream. Now, maybe it still is, but the state has committed to spend at least $13 billion for its share if the pieces come together this time.

However, the governor said he has the right team in place to match what faces the state’s 13th administration.

It was that team that decided to lay out his ambitious state spending reform plan all at once Dec. 9, rather than to parse the tax, Permanent Fund Dividend and revenue proposals, which would have been the politically expedient thing to do, Walker said.

“It was a group decision around the cabinet table, realizing that’s not the politically correct way to do it necessarily,” the governor said.

Since, Walker’s New Sustainable Alaska Plan has been picked apart by Republicans who say it doesn’t cut spending enough before resorting to a statewide income tax to help fund state government as the administration has proposed. Democrats have chided the governor’s plan to revamp how state dividend checks are paid to Alaskans, saying the governor’s plan, which would likely cut checks in half, at least in the near term, amounts to an unfair tax on low-income residents without amply taxing the oil industry.

This most recent debate with the Legislature is far from his first, however.

A series of kerfuffles over the state’s role in the $45 billion-plus Alaska LNG Project kept Walker at odds with the Republican majorities almost all year.

In the midst of those, Walker kept a campaign promise and expanded Alaska’s Medicaid system administratively when Majority leadership in the Legislature held up Medicaid legislation. 

That led to the Republican-led Legislative Council filing suit against the governor in August on grounds that he overstepped his authority. While a last minute injunction to stop Medicaid expansion failed, the lawsuit is ongoing.

Even where to hold a special legislative session became a contentious issue. The Majority outright ignored Walker in late April when it pushed to adjourn a special budget session Walker called for Juneau. The Legislature reconvened on its own a few weeks later in Anchorage.

A partial, $200 million veto of $700 million in the state operating budget to pay for refundable oil and gas tax credits drew the ire of not only Republicans in the Legislature, but also some in the industry.

Walker said he made the unexpected move after the tax credit sum was not addressed in the special budget session, as he predicted. It’s also one he stands behind because it got people talking about a credit program he considers unsustainable.

“It started the discussion; it really did,” Walker recalled Dec. 22. “It was a heated discussion, but it started the discussion.”

As the start of the next legislative session nears Jan. 19, the governor said he has made plans this year to meet with the leaders of the House and Senate Finance and Resources committees every two weeks, “because just about everything goes through Resources or Finance,” as a way to improve communication between executive and legislative branches, he said.

Walker also surmised that the state’s budget deficit, nearing $3.5 billion, might actually improve relations with the Legislature.

“I think that this session is going to be easier in some ways, as far as relationship-wise just because we’re all in this together,” he said. “The entire boat’s taking on water. I think we’re going to have a better working relationship.”

On President Barack Obama’s three-day, late summer visit, Walker said the president “connected with Alaska,” but the impact of the visit on the state probably won’t be known until after Obama is out of office.

“Some people said when he came back to the White House he was pretty much on fire about Alaska. Now, that could be interpreted two different ways,” Walker quipped.

Interpretation one: Alaska is a great national park and must be kept as such.

Interpretation two: Alaska needs to develop its resources to promote economic prosperity.

Walker said he continues to push the White House for access to the resources on and under federal control his state.

“I am not done with my outreach to this administration at all,” he said.

He recalled a conversation he had with Obama in which the president was surprised by the fact that only a small portion of the Arctic National Wildlife Refuge would be needed to be opened to exploration in order for the state to access potentially billions of barrels of oil.

“The 1002 (Coastal Plain) section is 8 percent of ANWR. We only need half of it; we only need the western half — 4 percent,” Walker said, attempting to put in perspective how a little of the revered wilderness could go a long way towards helping the state’s financial situation, which he said Obama is clearly aware of.

Walker also noted that each time he’s raised the issue of ANWR with Obama, the president quickly changes the topic to the AK LNG Project.

“Like I continue to tell Washington, we can self-heal if we are allowed access to the resources that we were promised,” the governor reiterated.

Elwood Brehmer is a reporter for the Alaska Journal of Commerce.