OPINION: Legislature needs to compromise to solve fiscal issues

Tuesday, October 31, 2017 - 11:28

We’re optimistic that our Alaska Legislature will be able to not only strengthen the course of criminal justice reform by passing SB 54, but also address our state’s fiscal crisis in the upcoming special session in Juneau. Here’s why:

Legislators and all Alaskans should be careful not to get so wrapped up in the ongoing debates over taxes, state spending and crime sprees, that we all miss the very real connection between our economy and the overall health of our state.

It’s really that simple. And it’s really that serious. Which is why we have hope and confidence that the Legislature and governor will work together toward fiscal compromise when they convene in special session Oct. 23.

Think about it. You would not buy a house until you know the interest rate on the loan, until you know the property tax bill. You would not invest in a business until you knew what the balance sheet looked like, both profit and loss. You would not construct a new building or expand your business until you knew the economic health of the community.

That’s the problem in Alaska today: Investors, whether oil and gas companies or real estate or mining or tourism or retail, are not confident that the state has a fiscal plan. They worry that they will start writing checks, only to see the state change the economics underlying their business plan.

Fiscal uncertainty can kill private investment, or at least wound it. We need stability. We need to show investors we are willing to help pay our own way.

We’re not losing jobs in Alaska because of one line or another in the state budget. We’re not losing private investment dollars because we talk about using Permanent Fund earnings to help provide public services. And we’re not ruining our future by considering broad-based revenues, as some irresponsibly claim.

The truth is, all those bad things — job losses, investor reluctance and a shaky economic future — are because we’re not doing enough.

The governor’s proposal for a flat wage tax is not perfect. No legislation ever is, and certainly no tax is ever popular. But it is an opportunity for debate, amendment, compromise and ultimately passage of a fiscal plan that doesn’t rely solely on one commodity.

The Alaska Legislature has recently shown it can work together on tough issues; they hammered out a budget comprise earlier this year which avoided a government shutdown; they came together in the spirit of compromise to eliminate unaffordable cash payments to oil companies and passed HB 111; and, they approved a capital budget in one day without taking per diem to get the job done.

Like many Alaskans across the political spectrum, we were supportive of the 2016 criminal justice reform bill. But we knew it would not solve all our problems and we support constructive changes in current legislation on the table this month. We know the opioid epidemic has contributed to the public safety crisis that has hurt so many families and communities. We also know that we need sustainable funding for law enforcement, prosecutors and mental health services. And we absolutely must address the chronic shortage of rehabilitation beds. Finally, we acknowledge that addressing these public health and safety crises will require an investment of financial resources.

Now more than ever we need our lawmakers to come together and focus on our state’s economy and a safer Alaska. If we do nothing, if we fail to put the state on a path toward sustainable finances, if we miss another opportunity to build a stronger Alaska… we just give businesses, investors and the public another reason, another year, to put their money, and their future, elsewhere.

Our focus should be on a stronger, economically healthy state for decades into the future.

It’s not a matter of who wins or loses or who pledges to defend a political line in the sand or who stands strongest against any given issue. It’s a matter of compromise, working together and finding an acceptable solution that can give certainty to 735,000 Alaskans.

Mike Navarre is mayor of the Kenai Peninsula Borough; Jim Matherly is mayor of Fairbanks.

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