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Limited state revenue foreshadows fiscal tug-of-war in Alaska Legislature • Alaska Beacon

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Limited state revenue foreshadows fiscal tug-of-war in Alaska Legislature • Alaska Beacon


In a series of hearings this week within the Alaska State Capitol, public-school advocates from across the state presented hours of impassioned and often emotional testimony in favor of a bill that will sharply increase Alaska’s funding for public schools.

But a pair of cold-blooded financial hearings also showed that the request may have to compete with the Permanent Fund dividend and aid for aging state buildings.

In December, Gov. Mike Dunleavy proposed a $7.7 billion state budget for the fiscal year that starts June 1. 

That spending would require the state to spend $1.5 billion from savings, and it isn’t too dissimilar from what the governor has proposed in each of the past two years.

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In each of those years, the Legislature took the governor’s plan and slashed his proposed Permanent Fund dividend in order to avoid spending from savings.

The Legislature’s preferred dividend formula is called the 75-25, for the way it takes the annual transfer from the Alaska Permanent Fund to the state treasury, then divides it, 75% for services, and 25% for dividends.

“The last two years, the Legislature has put forward the 75-25 dividend and been able to have a balanced budget. This year, that is probably not enough,” Alexei Painter, director of the Legislative Finance Division, the Legislature’s budget analysis wing, told the Senate Finance Committee this week.

The problem is twofold: Lawmakers are preparing to spend more, and oil isn’t giving the state as much revenue as it used to.

When it comes to oil, the problem is one caused by success. State tax law allows oil companies to lower the amount they pay in production taxes through a deduction based on their operating expenses. 

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ConocoPhillips is spending hundreds of millions of dollars to develop the Willow project on federal land, and it can deduct its expenses from taxes it would otherwise pay this year. That makes it a money-loser for the state treasury in the next few years.

The nearby Pikka project is being developed by another company, which doesn’t currently produce oil. That company, Australia-based Santos, will be able to apply its deductions to future oil production, so even though the North Slope will be producing more oil, the state won’t be earning more money.

In the state Capitol, House Bill 69, an education-funding increase proposed by members of the state House, is expected to cost at least $300 million above what the governor has proposed spending on education. An official estimate isn’t yet available.

Add the cost of that legislation to already-expected cost increases, and there’s not enough money to go around, Painter told the Senate Finance Committee, then reiterated his comments to the House Finance Committee on Thursday.

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“Simply switching the dividend to 75-25 is not going to be enough to balance the budget this year. You’re going to have to either find other budget reductions, reduce the dividend further or explore other revenue options. You can’t just do that one thing and it’s solved, which has worked the last two years,” he said.

To date, no legislators have introduced any legislation proposing to significantly change state taxes. During the first six years of his administration, Dunleavy has vetoed every tax bill to reach his desk, and legislators have never overridden any of his vetoes.

Painter also warned both committees that the governor’s proposed budget doesn’t include enough to keep up with maintenance at state facilities.

Alaska has a maintenance backlog of more than $2 billion, and many state buildings were built during the oil boom of the 1970s and 1980s. That leaves many of them overdue for replacement or repair.

The problem may be worse than official reports indicate, Painter said, offering the Fairbanks Pioneer Home as an example.

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That building has a deferred maintenance list of a few million dollars, but it also needs a new roof and doesn’t meet federal standards for accessibility by handicapped people.

Replacing the building would cost $115 million, he said.

In the House Finance Committee on Thursday, Rep. Will Stapp, R-Fairbanks, asked Painter what would happen if average oil prices finished $10 below what the state is expecting in the coming years.

That would widen the expected deficit by $350 million to $400 million, Painter replied.

“Have you done any modeling on the 99-1 yet?” Stapp asked, jokingly referring to a dividend formula that would leave just 1% of the annual Permanent Fund transfer for dividends.

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“I don’t even think that would cover the costs of running the PFD program,” Painter said.

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Opinion: Typhoon Halong’s aftermath revealed Alaska at its best

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Opinion: Typhoon Halong’s aftermath revealed Alaska at its best


Kipnuk resident Garrett Kashatok holds 11-month-old Shameka while attending a town hall for people displaced by ex-typhoon Halong at Bettye Davis East High School on Wednesday evening, Nov. 12, 2025. (Bill Roth / ADN)

As we enter this holiday season, it is important to recognize and give thanks to the countless Alaskans who helped in Western Alaska’s emergency response to Typhoon Halong. In doing so, you helped preserve the dignity of your fellow Alaskans in need.

At the Yukon-Kuskokwim Health Corp. (YKHC), we had medical, behavioral health, construction and remote maintenance teams who worked very long hours and slept in affected villages. We shipped tens of thousands of pounds of critical supplies throughout the region. We set up and managed the Bethel shelter, its travel, meal preparation, laundry and cleaning operations. In future months, we will continue to lead water and sewer rebuilding efforts.

Since October, the daily local/state/federal emergency operations center has been hosted by YKHC at the Bethel hospital. YKHC helped lead and coordinate the local emergency operations center with other local agencies until the beginning of November and has since transitioned out of that role. YKHC assisted the Alaska National Guard and Coast Guard and evacuated more than 100 residents from affected villages to safe places of their choosing with more than 50 YKHC charter flights. We shipped more than 22,000 bottles of water, 12,000 ready-to-eat meals and other supplies throughout the region. Most of that was accomplished within the first five days after the storm.

We hosted Sen. Dan Sullivan, Sen. Lyman Hoffman, Rep. Nellie Jimmie, Speaker Bryce Edgmon, and other state and federal officials at YKHC for disaster coordination meetings. The state emergency operations center moved more than 600 evacuees out of the shelters to hotels and other noncongregate lodging by Oct. 31 — which for disasters, must be in record time. Hundreds more were taken in by family members from around the region, Anchorage or beyond.

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I thank all 1,600 YKHC employees who helped survivors of Typhoon Halong. Your dedication and devotion toward achieving our mission and vision is applauded.

A special thank you to the Alaska National Guard and Coast Guard for their heroic and life-saving missions during the storm and those that continue today in order to help ready survivors’ homes for winter. The professionalism, urgency and compassion shown by the Guard, President Trump, Gov. Dunleavy, state of Alaska emergency operations center, FEMA, the Alaska Divisions of Forestry and Transportation, American Red Cross, AVCP, AVCP RHA, City of Bethel, Lower Kuskokwim School District, Samaritan’s Purse, Team Rubicon, World Kitchen, airline/cargo operators, local churches and businesses, the Municipality of Anchorage and many others is truly commended.

While recovery and repatriation will continue for months and years, if Alaskans continue to act with the same resolve as we did with this emergency response, more can be accomplished in the future.

Although many lost much during this tragedy, each of us still has much more to be thankful for during this holiday season.

Dan Winkelman is president and CEO of the Yukon-Kuskokwim Health Corp.

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• • •

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Spate of violent crime in Fairbanks, including 2 homicides, prompts special investigative detail from Alaska State Troopers

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Spate of violent crime in Fairbanks, including 2 homicides, prompts special investigative detail from Alaska State Troopers


An evening view of the Chena River and downtown Fairbanks on January 31, 2023. (Marc Lester / ADN)

A series of violent crimes in Fairbanks, all in the past month, has prompted the Alaska State Troopers to deploy a team of investigators from Anchorage and Mat-Su to focus on several unsolved cases and ongoing searches for suspects.

Two people were killed in Fairbanks in cases reported within an hour of each other early Saturday. A few days earlier, authorities say, someone fired shots at two trucks involved in a gold-hauling operation in the Fairbanks area. And the search continues for an 18-year-old wanted on murder charges in the death of a teenager at a Fairbanks party in late October.

The decision to send investigators as well as support staff from Southcentral to the Interior city comes in response to “the level of violent criminal activity in Fairbanks in such a short period of time,” Department of Public Safety spokesman Austin McDaniel said Tuesday.

The troopers are the lead investigative agency on all four of the cases and are adding to their existing staffing. The agency’s post in Fairbanks includes a major crime unit composed of a sergeant and six investigators, McDaniel said. The total additional staffing is under a dozen people, he said.

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Troopers made a fairly immediate arrest in one of the homicides on Saturday: Brooklyn Whitman, 27, is charged with first-degree murder. Whitman is accused of firing a pistol through an apartment door, killing a woman who lived there with several young children, according to a criminal complaint filed in the case. The two had been involved in a relationship; the woman’s neighbors described hearing prior altercations and Whitman banging on the door that morning, the complaint said.

The other homicide that morning remains unsolved: 37-year-old Michael Boyd was found dead in the driver’s seat of a vehicle parked near a gas station in the Farmer’s Loop area, troopers said in an online dispatch. Boyd died of a gunshot wound, McDaniel said Tuesday.

Troopers are also involved in two ongoing searches for suspects in attempted murder and murder cases over the past month.

The agency is asking for assistance finding the occupant or occupants of a white Honda Pilot they say fired shots at two Black Gold Transport trucks on the Richardson Highway and near the Steese Highway and Chena Hot Springs Road last week.

They also continue to search for 18-year-old Darius Morgan, wanted on a $1 million warrant for murder in the death of a 15-year-old at a house party on Oct. 25. Witnesses saw him brandishing a black pistol at the party before the teen was shot, according to a criminal complaint filed in that case. Morgan was convicted of second-degree robbery last year and was not supposed to possess any weapons, the complaint said.

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It’s possible Morgan is still in Fairbanks or is in Anchorage or the Southcentral area, McDaniel said Tuesday. He is considered armed and dangerous, and anyone who sees him should call 911 rather than approaching him, he said.

The violent crime detail in Fairbanks is part of a change the Alaska Bureau of Investigation made several years ago for unsolved homicides and other serious violent crimes like sexual assaults, McDaniel said. Instead of assigning a small team of case officers to run an investigation, he said, troopers deploy extra investigative resources to make progress more quickly.

“Everyone who wasn’t actively working on their own dynamic violent crime that had time sensitivity was either physically pulled up here or working on other supportive aspects,” McDaniel said. He said some investigators are prepared to stay in Fairbanks “for a significant amount of time.”

Anyone with information about the recent crimes in the Fairbanks area is asked to contact troopers at 907-451-5100.





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Hawaiian Workers Fight Back As Alaska Rushes Integration

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Hawaiian Workers Fight Back As Alaska Rushes Integration


Alaska’s rapid 2026 integration timeline is running straight into three labor battles that each carry real consequences for Hawaii travelers. The most immediate flashpoint sits inside the maintenance hangars. About 900 Hawaiian mechanics represented by IAM since 1951 are facing a representation challenge from AMFA, which speaks on behalf of roughly 1,000 Alaska mechanics, even though Alaska’s fleet is nearly three times larger.

At the same time, as many as 40 to 60 line service workers sit in limbo and worry their jobs could disappear depending on how the vote breaks. The numbers alone explain why this suddenly feels like a high stakes moment. A roughly $28,000 annual pay gap separates the top scales at the two airlines.

Most work for the 717 interisland fleet will remain in Hawaii as long as those aircraft continue to fly, but the fleet’s future is likely limited to about five years. When the 717s retire, they will leave the operation entirely, and the maintenance work tied to that fleet will disappear with them. All of this is happening as Alaska moves ahead with its recently issued single operating certificate and a newly combined passenger service (reservation) system cutover planned for early 2026.

Travelers may not feel these issues directly today, but the decisions made over the next year will shape how travelers experience the airlines long after the paint schemes and brand promises settle.

What does this mean for Hawaii travelers?

For people heading to and from Hawaii, the most immediate concern is how maintenance decisions made during the integration could change the way aircraft are supported for Hawaii flying. Hawaii based mechanics have decades of experience working in this unique operating environment, with its long overwater routes and weather conditions that are different from mainland patterns. If more heavy work eventually shifts to mainland bases, the distance alone could affect how quickly aircraft return to service when something unexpected happens, and that is where travelers could feel it.

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There is also the interisland question mentioned above, and what happens after the 717 fleet reaches the end. Whether that flying is taken over by new narrowbody aircraft, contracted regional partners, or a hybrid arrangement will affect fares, frequency, and the number of nonstop options available. That decision will also shape how many maintenance and flight attendant jobs remain based in Hawaii.

The cabin experience is the other major piece. If Hawaiian flight attendants lose ground in the integration or if more flying is staffed from mainland bases, passengers may feel a shift in the feeling of onboard hospitality that has defined Hawaiian Airlines for decades. Even small changes in tone, announcements, or crew familiarity with island travel patterns could make flights feel different.

Travelers are also looking at a long timeline. The passenger service system cutover is not expected for approximately six months. That means enduring more months of overlapping negotiations, union elections, base adjustments, and operational changes. For travelers deciding whether to stay loyal or try other airlines, this period will shape impressions of whether the combined carrier can deliver a unique and dependable Hawaii service while navigating so much internal change.

As Alaska pushes forward, it continues to say the Hawaiian brand will remain. The coming year will show exactly how that promise extends beyond the look of the aircraft to the jobs, expertise, and service culture that made the brand meaningful in the first place.

Mechanics union battle latest to move to center stage.

For Hawaiian mechanics, the union fight is about job security, pay, and whether maintenance work rooted in Hawaii will stay here or gradually shift to Seattle and mainland bases where Alaska already has infrastructure.

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IAM has represented Hawaiian mechanics and related employees for more than 70 years and has built a contract around job protection, grievance processes, and seniority language tailored to an island-based operation.

AMFA brings a different model with a more decentralized structure, direct representation, and a history of navigating previous mergers, including Alaska’s purchase of Virgin America and Southwest’s acquisition of AirTran.

The pay gap is part of the tension as Alaska’s licensed technicians earn more than their Hawaiian counterparts. The fleet mismatch is another issue. Alaska operates a much larger narrowbody fleet yet has only slightly more mechanics, which Hawaiian workers interpret as a sign of greater outsourcing on the mainland. Mechanics worry that the long-term structure of the combined airline could shift more maintenance activity to established mainland bases.

There is also the matter of the 717 fleet.

Alaska has said that its maintenance will stay in Hawaii for as long as the aircraft operate. With an expected five-year timeline before the Hawaiian 717 retirement, that clock is already visible. The bigger question is what comes after.

When new aircraft eventually replace the 717s, the maintenance work could follow the plane to wherever Alaska structures its program. For Hawaii-based mechanics, that raises questions about long-term job stability. For travelers, it introduces questions about how quickly aircraft can be turned around if problems appear at the last minute, and the work now sits thousands of miles from where the aircraft flies.

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The uncertainty facing 40 to 60 line service workers adds another layer. Some roles that have historically existed inside the Hawaiian mechanics and related group may not clearly fall within the structure proposed by AMFA, and IAM argues that workers could lose protection altogether. While the two unions argue over classifications, the employees themselves are wondering whether they will still have jobs at the combined airline and, if so, where those jobs will be based.

Pilot integration shows the pattern.

Pilots have already faced their own version of this story, which we covered in Hawaiian pilots call out Alaska as integration turmoil grows and Hawaiian pilots warn of what comes next. Those pieces surfaced many of the same themes now appearing among mechanics. Pilots have expressed concern about the pace of Alaska’s integration, shifts in base assignments, widebody access, international flying, and the potential shrinkage of Honolulu as a long haul base. A single operating certificate has already been approved and implemented, and Alaska is moving at an unusual pace toward a single passenger service system next year.

Reader comments on those pilot articles revealed a sharp divide. Some argued that Hawaiian was losing roughly $1 million per day before the buyout and that rapid integration is necessary. Others expressed concern about losing the Hawaiian identity they valued and the operational stability they trusted. Several noted that this timeline feels among the fastest they have seen yet. Whether they supported Alaska’s urgency or questioned it, they agreed that things are moving quickly and that the human side of the operation has been asked to adjust at a relentless pace.

Now mechanics are feeling that same compression. What first looked like a cockpit problem is clearly part of a much larger integration pattern touching every major workgroup.

Flight attendants face a quiet but crucial battle.

The flight attendant integration has been far quieter in public, yet it may have the most visible effect on Hawaii travelers. A joint agreement under AFA will eventually determine pay scales, base assignments, work rules, and the service standards that define the cabin experience. Hawaiian flight attendants have built a service identity that feels distinctly rooted in the islands, from Hawaiian language announcements and greetings on some flights and an overall approach to hospitality that reflects Hawaii as home more than corporate standardization.

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As the two airlines merge service cultures, the question is whether Hawaiian’s cabin identity will remain recognizable or be absorbed into Alaska’s more uniform system. This is not simply a branding question. Hawaii based crews bring a familiarity with local travelers, interisland patterns, cultural expectations, and even the subtle ways holiday and seasonal travel differ in the islands. If more flying is staffed from mainland bases or if the integration process wears down long time Hawaiian crews, travelers may notice service that feels less connected to the place they are flying to and from.

Integration pressure becomes a systemic risk.

Step back, and the issue becomes greater than any single group. Alaska and Hawaiian already operate under a single certificate. Behind the scenes, the work of harmonizing manuals, training, and scheduling is moving quickly to support the 2026 passenger service system conversion. That system integration is the moment when the two airlines finally function as one in the ways travelers experience most directly, including booking, seat assignments, airport processing, and irregular operations.

Labor, however, is not on the same timeline. Mechanics are heading into a representation election with job security on the line. Pilots are navigating base changes and aircraft assignments. Flight attendants are working toward a joint agreement that will shape the unified passenger experience. Each group is handling its own pressures while the company pushes toward deadlines that leave little room for missteps.

Under the Railway Labor Act, strikes are unlikely, but there are other ways integration strain can show up in the operation. Slowdowns, morale issues, higher attrition, and more brittle schedules can all translate into delays and cancellations. Alaska is betting it can move faster than the friction created by these overlapping negotiations. The risk is that pushing so hard creates instability just when the combined airline needs to demonstrate reliability to Hawaii travelers.

Have you noticed any changes yet on recent flights to and from Hawaii? If so, how do they make you feel about the direction of the combined airline?

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