Flawed Process and Policy
In response to the 67% pay raise proposal for legislators, I introduced Senate Bill (SB) 111 “Rejecting Legislators’ Salary Increase” last week. Not only is this legislation a responsible step considering the fiscal shortfall the legislature is currently facing as we craft the FY2024 budget and the lack of a long-term fiscal plan, but it also eliminates the conflict of interest problem the current legislature faces by passively accepting the salary increase recommendation.
As a bit of a background, Senate Bill 86 was introduced on February 24, 2023 to block the first round of increased compensation recommendations by the Alaska State Officers Compensation Commission (ASOCC). This report recommended increasing department heads’ and governor’s salaries by 20%. The bill passed the Senate on February 27, 2023 and the House on March 6, 2023. SB 86 was subsequently vetoed by Governor Dunleavy on March 22, 2023 after he appointed new members to the ASOCC who met and amended the first report to include compensation increases for legislators.
The ASOCC Amended Final Findings and Recommendation dated March 25, 2023, unless rejected by the legislature, provides each legislator with a 67% pay increase. This increase equates to $33,600 per legislator, a total of $2,016,000 annually for 60 legislators. Combined with the current salary and per diem, that is $7,250,400 per year excluding benefits.
This raise is being recommended in the midst of the spring revenue forecast which predicts a $925 million deficit for the current year and next. It is also occurring when schools are requesting a large funding increase; when we need to ensure snowplow driver and other state worker vacancies can be filled; and when seniors on fixed incomes and families are asking about their PFDs in lieu of high inflation, expensive groceries, and increased housing costs. Under the current circumstances, the legislature should reject the large pay increase.
SB 111 provides for the rejection of the ASOCC March 25, 2023 amended report regardless of the 60-day time limit. The legislation also offers an optional pay schedule for legislators for the current salary by allowing its disbursement over the first five months of the calendar year during the legislative session as an alternative to disbursement over twelve months. I included this provision in order to make it easier for Alaskans of working age to serve in the legislature. If a legislator concluded service prior to the end of a calendar year, the individual or the estate of the individual would be indebted to the state on a pro rata basis.
In a statement to the media, I explained why I submitted SB 111:
“Not only is the Compensation Commission process flawed and fraught with conflict-of-interest issues due to legislators having the power to give themselves a raise by passively accepting the report, but such a large raise when we have a tremendous shortfall is unwarranted in this fiscal climate. We need to concentrate this session on putting the people’s fiscal house in order and making sure we start getting the most bang for our public buck when it comes to our schools and student learning.”
Senator Shelley Hughes
My bill was read across the floor on Wednesday at which time it was referred to the Senate Finance Committee. At present, based on the actions on the floor on the same day, it appears that this committee supports the pay raises and likely has little interest in considering the legislation.
How am I coming to that conclusion? The House Speaker had sent a letter on Tuesday to the Senate President inviting the Senate to a joint session Wednesday afternoon for the purpose of voting to override the veto of SB 86.
On Wednesday morning, the Senate President officially turned down the invitation.
During the floor session that same morning, I then moved to adopt the following Sense of the Senate which the Senate failed to do:
Sense of the Senate
Sponsored by Senator Shelley Hughes
It is the sense of the Senate that the Senate disapproves of the pay increases recommended by the State Officers Compensation Commission that were included in the bill that passed the Senate on February 27th. This bill was subsequently vetoed by the governor on March 20th.
In addition, the Senate finds that the process undertaken by the State Officers’ Compensation Commission was flawed in adopting an amendment to their original report, and with the spring revenue forecasts predicting a deficit of over $900 million for this and the next fiscal year, pay raises are not justified nor warranted.
Following the failed adoption of my Sense of the Senate disapproving of the legislator pay raises and the process, Senator Myers made another attempt for the override vote; he moved to accept the House invitation for a joint session. His motion was blocked by a vote upholding the ruling of the chair by the Senate Majority, 2 nays to 17 yeas.
We did not have the numbers on Wednesday but we will not stop fighting for common sense policy. As it turns out, there remains interest in the House to introduce a bill on this topic.
One final note on the issues of pay raises for now. We must address the clear flaw in the ASOCC and salary recommendation process in general. As it stands, the process creates a direct conflict of interest for sitting legislators despite the fact that an acceptance of a salary increase is passive and does not require an actual vote on the floor by legislators. Salary increases by the ASOCC should be for future legislators not current legislators or the process should be changed to remove the legislature entirely from the salary decision-making process.
