Alaska Public Media

Alaska lawmakers are going for round two on a bill Gov. Mike Dunleavy vetoed last year. The bill would change the way corporate income taxes are calculated, bringing in tens of millions of dollars in new revenue.

Lawmakers failed to override Dunleavy’s veto of the bill at the beginning of this year’s session.

Backers of the bill say it’s necessary with a tight state budget, and it’s similar to a proposal Gov. Mike Dunleavy included in his fiscal plan.

Rep. Calvin Schrage, an Anchorage independent who co-chairs the House Finance Committee, said at the bill’s first hearing on Friday that it’s an effort to bring the state’s tax laws into the digital age.

“Currently, there is a loophole in Alaska’s corporate income tax structure, and that loophole is that if you’re a highly digital business that doesn’t have a physical presence here in the state, you are not paying taxes to the state of Alaska. You’re paying those taxes to other states,” Schrage said.

The bill would make two substantial changes to corporate income taxes in an effort to attribute more of Lower 48 companies’ income to Alaska.

The first implements what’s known as “market-based sourcing.” That essentially means that large businesses would pay taxes based on where their customers are, rather than where the company does its work. It’s a change dozens of other states have made and one the governor included in his fiscal plan.

The second component would change the tax rules for so-called “highly digitized businesses.” That’s an effort to extract more tax revenue from companies like Netflix, eBay and others that do most of their business over the internet but don’t have a presence in the state. That change is not a part of the governor’s plan.

Last year, the state Department of Revenue estimated the bill would raise between $25 and $65 million each year.

Rep. Will Stapp, a Fairbanks Republican in the minority who voted for the bill last year but voted against overriding Dunleavy’s veto, said he’d like to see some technical changes. For one thing, he’d rather not make the bill retroactive to the start of this year. But Stapp said he’s open to supporting it after a few tweaks.

“No change in tax structure is perfect,” he said in an interview. “But there are impacts that we should actually understand, that the public’s going to expect us to kind of understand so we can articulate it.”

Even though the bill is similar to an element of Dunleavy’s fiscal plan, it’s not clear the governor would sign the bill if passed. His office declined to comment on the new bill. But Dunleavy has said repeatedly he opposes new revenue measures without stricter limits on how state money can be spent.

The Alaska House Finance Committee adopted its first draft of the state’s budget. It makes a variety of smallish changes from the governor’s proposal, and one really big one: it removes the Permanent Fund dividend.

The change has attracted a lot of attention. So what does it mean?

Committee co-chair Rep. Andy Josephson, an Anchorage Democrat, said Alaskans shouldn’t panic — there will be a dividend this year.

The House’s first draft strips out everything new in the governor’s budget and represents essentially the status quo, minus the PFD. That provides a starting point for lawmakers to work from, he said.

But putting any PFD number into the budget right now could give Alaskans the wrong impression of what their legislators support and what a realistic dividend could be, Josephson said.

“Perhaps it’s counterintuitive, but sometimes starting at zero — because we are going to have a dividend — is the more honest place to start,” he said.

It’s also fairly typical, he said. House lawmakers have taken this approach for five of the past eight years, according to Josephson’s office. Members of the bipartisan House majority who control the committee approved the new draft in a caucus-line 6-5 vote.

Lawmakers on both sides have said they see Gov. Mike Dunleavy’s proposal to pay a roughly $3,600 dividend as unrealistic with low oil prices and a tight state budget.

But minority Republicans say they see removing the dividend from the budget at this stage as a worrisome sign. House Minority Leader Rep. DeLena Johnson, a Palmer Republican, said dropping the dividend from the working draft reduces pressure on lawmakers to cut spending and hold down expenses.

“If we don’t have some kind of PFD, then we’re just going to spend it, and we’re going to continue to spend, and then we are going to continue to spend into savings,” Johnson said at a news conference on Thursday.

Economists told lawmakers earlier this year that reducing the PFD to cover a deficit is akin to a regressive tax and hits low-income Alaskans the hardest.

Removing the PFD from this early budget draft also helps the majority avoid an uncomfortable vote that threatened to hold up progress on the budget last year. During the last legislative session, the budget briefly stalled when lawmakers were unable to muster the votes to reduce the PFD in a later draft.

The upper house of the Legislature is taking a different approach. The first-draft budget in the Senate includes everything the governor asked for, including the PFD. (There is one exception, Dunleavy’s proposal to create a Department of Agriculture, which is the subject of an ongoing lawsuit.)

Both the Senate and House are controlled by Democrat-heavy bipartisan coalitions.

How much the dividend will ultimately be is up in the air for now, but some key lawmakers have said they don’t expect much change from last year’s $1,000 PFD.

“My best guess is between $750 and $1,400,” Josephson said. “Personally, based on what happened last year, I think it’s going to be around $1,000, but it’s way downstream.”

The state operating budget officially sets the dividend, and it’s typically one of the last bills to pass before the end of the regular session in May.

WASHINGTON — Alaska Congressman Nick Begich said it’s just common sense to require a photo ID to vote and to make sure that only citizens can register.

“For years, there have been questions levied, on both sides of the aisle, about the integrity of elections,” he said in an interview Tuesday. “We can’t have that. That’s not healthy for our democratic republic to be questioning the nature of elections.”

The SAVE America bill will restore trust in election integrity, he said.

The U.S. House passed it on Wednesday. It requires people to show proof of citizenship to register to vote and to show photo ID to get a ballot.

Begich signed on as a co-sponsor Monday, though the bill’s requirements for proving citizenship asks more of voters than he first thought.

Also called the SAVE Act, the legislation is a huge priority for Republicans. President Trump, Elon Musk and a host of right-wing influencers are pressuring the Senate to pass it. They say the survival of American democracy depends on ensuring that non-Americans don’t cast ballots.

Many surveys and audits show illegal voting by noncitizens is rare. Democrats say what the SAVE Act will really do is prevent millions of eligible people from voting.

Begich cites polling that shows more than 80% of Americans want to require photo identification at the polls. The bill won’t be hard to comply with, he said.

To vote, he said, Alaskans could just show their REAL ID card at their polling place, or another type of photo identification listed in the bill.

Where a person would have to prove citizenship is when they register. Begich said that requirement, too, is as simple as showing a REAL ID.

“The REAL ID was acquired in a manner that is demonstrative of your citizenship status,” he said in an interview Tuesday.

But that’s not correct, as a Begich staffer acknowledged in an email after the interview. States issue REAL ID cards to noncitizens, such as green card holders, who are not allowed to vote.

If the SAVE bill becomes law, a person would have to bring other documentation of citizenship, like a passport or a birth certificate, with them when they register to vote. Technically, the bill doesn’t end registration by mail or online, but the applicant would still have to present documents “in person to the office of the appropriate election official” before the registration deadline.

“The Congressman’s view is that for most Americans, including most Alaskans, this is documentation they already possess and use for other routine purposes (employment verification, travel, obtaining a REAL ID, applying for benefits, etc.),” the email from Begich’s office says.

Voting advocates say the bill imposes several requirements that will discourage people from participating in elections, like requiring that mailed ballots include a photocopy of the voter’s ID card.

“This is creating incredible barriers to voting,” said Michelle Sparck, director of Get Out the Native Vote.

It would be especially hard on communities off Alaska’s road system and those that are far from government services, she said.

“It’s just asking way too much of a lot of demographics and pockets in the state,” she said.

Sen. Lisa Murkowski calls the bill federal overreach. The Constitution gives states the authority to determine the “times, places and manner” of federal elections, and Murkowski said states know best the on-the-ground realities.

“I’m not saying you shouldn’t have identification,” she said. “I’m saying that it is left to the states to determine how you provide that proof.”

Begich and other sponsors of the SAVE Act say the Elections Clause in the Constitution leaves a lot of authority to the states but not everything.

“It continues,” Begich said, reading the end of the clause. “‘… But the Congress may at any time, by law, make or alter such regulations.'”

That, Begich said, gives Congress the power to impose the SAVE Act.

The bill, so far, does not have the 60 votes it needs to pass the Senate.

Fortyeight Republicans are co-sponsors, including Sen. Dan Sullivan. He did not respond to an interview request. His office sent a statement saying the bill wouldn’t disenfranchise Alaskans.

The Iditarod Trail Sled Dog Race is less than a month away and set to run on its normal northern route this year.

Race officials said that’s a relief, after low snow conditions last year forced the race to start in Fairbanks, over 200 miles north, for the fourth time in history.

Snow conditions are generally much better than they were last year, said race director Mark Nordman, although there were concerns about the trail until just recently.

“It wasn’t that long ago that I was still concerned about going over the Alaska Range, because there wasn’t a lot of snow up by Rainy Pass Lodge, one of our checkpoints,” Nordman said. “But we’ve got plenty of snow now, and so I think we’ll be good.”

In 2025, race officials said a portion of the trail outside of Nikolai was impassable because of the lack of snow. Nordman said that section, called the Farewell Burn, is notoriously challenging for its ice and windblown ground. But it currently has some snow coverage and “looks doable,” he said.

The 1,000-mile race typically alternates routes each year, running the northern route on even years and the southern route on odd years. The trail is the same for the first 350 miles before splitting at the ghost town of Ophir, then rejoining at the Yukon River village of Kaltag before heading to Unalakleet and continuing up the Bering Sea Coast.

Clearing brush off the trail takes more work now than it used to, Nordman said.

“Where we might have only brushed the trail every four or five years in certain areas, it seems like it’s every other year now,” he said.

One section in particular required extra effort.

The remnants of Typhoon Halong last fall decimated the trail between Kaltag and Unalakleet, Nordman said. The Iditarod hired a crew to clean up blown-down trees along that 85-mile stretch, and it’s now ready for mushers, he said.

“They spent a full month out there, cutting, opening it up, grooming,” Nordman said. “Otherwise nobody would be going over that trail this year.”

This year’s Iditarod starts March 7, with its parade-like ceremonial start through Anchorage. The race will officially start March 8 in Willow.

As Alaska lawmakers reckon with a tight state budget and rising costs in the Department of Corrections, some are floating an uncomfortable idea: once again sending Alaska inmates out of state.

Over the last ten years, lawmakers have boosted the Department of Corrections’ budget by 70%, and even that hasn’t been enough.

Each of the past five years, the department has had to ask lawmakers for millions more — or tens of millions more — to make ends meet. This year, the department is requesting $24 million to cover unexpected costs in the current budget.

The department’s commissioner, Jen Winkelman, told the Senate Finance Committee earlier this month that she looked every day for ways to rearrange operations to avoid budget shortfalls or overruns. Health care for inmates and overtime to make up for short staffing are the two largest cost drivers, Winkelman said.

“It is consistently … a perfect storm,” Winkelman said.

Lawmakers went as far as to close one housing unit at the Spring Creek Correctional Center in Seward last year in an effort to save money. But sometimes, Winkelman said, big expenses come up unexpectedly.

“Approximately two weeks ago, we had a large fight on the yard — 48 inmates involved in a fight,” Winkelman told a House committee on Tuesday. “Quick napkin math, we believe it to be just under $200,000 that that cost us.”

Five people were injured in the fight, and all are recovering, a department spokesperson said. But Winkelman said the cost-cutting move to close part of the prison may have played a role and ultimately resulted in a large unexpected cost.

“Those are just those anecdotal examples of the population and the complexity when we start overpopulating one area, what happens as a result due to the population we serve,” she said.

The spiraling costs have some lawmakers floating a return to a practice Alaska abandoned more than a decade ago: sending prisoners out of state to save money.

“We can’t keep going the direction we’ve been going the last few years,” said Sitka Republican Sen. Bert Stedman, a co-chair of the Finance Committee. “The operating budget is extremely strained with those items, and that’s what’s driving this discussion.”

Wasilla state Sen. Rob Yundt, a Republican in the minority, filed Senate Bill 126 last year, which if passed would direct the Department of Corrections to explore the idea to see if it saves money.

“Oftentimes we get to run legislation that we’re excited about,” Yundt said at a hearing on Tuesday. “There is none of that here.”

In the 1990s and 2000s, the state contracted with private prisons in Colorado and Arizona. By 2005, about a third of Alaska’s prisoners were held out of state in private facilities, according to news reports at the time.

One of those prisoners was Adam Barger, who spent more than a decade in out-of-state prisons after his conviction in Alaska in the 1990s. He returned in 2013 after the state opened the $240 million Goose Creek Correctional Center in the Mat-Su borough in an effort to bring Alaska’s prisoners home.

When he was transferred back, guards told him how much more difficult it was to manage prisoners who had been sent to Outside facilities than those who had not, Barger told lawmakers during public testimony on the bill.

“We were more violent, had gang affiliations, drug addictions, behavioral problems, and were more resistant to authority than those who had never been sent out of state,” Barger said. “Then, we were released back into the community.”

Some, like Barger, managed to leave the justice system behind them, he said. Barger said he earned a master’s degree and now lives in Arizona.

“For many, though, they were apt to get out and return to incarceration, often in conjunction with another charge,” Barger said. “They went back to their communities and created more victims because the behavioral issues they developed out of state had not been addressed or resolved prior to their release.”

Barger asked lawmakers to oppose Yundt’s bill.

Yundt’s bill would mandate that Alaska prisoners be kept separate from those from other states. It would also limit the prisoners that could be sent out of state to those with at least seven years left in their prison term, and Yundt said he’d like to see inmates brought back to Alaska as their release date approaches.

Sen. Löki Tobin, an Anchorage Democrat in the majority, said she sees other ways to reduce costs in the state’s prison system — like granting parole for people who are elderly, disabled or unlikely to reoffend.

Tobin said Alaska grants parole far less often than other states, and she blames the state’s parole board for keeping too many people behind bars.

“They’re engaging in double jeopardy,” Tobin said. “Folks who are up for discretionary parole, who are excellent candidates to re enter into their community safely with support, are being recommitted to incarceration.”

The parole board chair said last year that state law places strict limits on the board’s ability to grant parole.

The policy director of the Alaska chapter of the American Civil Liberties Union, Mike Garvey, said that sending prisoners out of state would cut them off from family and friends in Alaska and make them more likely to reoffend.

“Moving prisoners out of state jeopardizes the constitutional rights of prisoners in Alaska, as well as presents public safety concerns,” Garvey said. “Alaska’s Constitution guarantees prisoners the right to rehabilitation, to due process, the right to counsel and the right to adequate medical care.”

Yundt said he was sympathetic to Barger and Garver’s concerns.

“I was once a young child that would travel to see family members as well on a Sunday, and so that’s not a great situation for anyone to be in,” he said. “I wish we weren’t in the situation, but here we are.”

Democratic Juneau Sen. Jesse Kiehl, a member of the powerful Finance Committee, said he understands the cost concerns, but he’s skeptical.

“I will just express a little concern about the notion of shipping Alaskans to warehouses outside,” Kiehl said. “We’ve done that in the past. The cleanup has been both expensive and ugly, and I don’t know that that’s a long term cost we want to bear.”

To realize any savings, Winkelman said, the department would likely need to close a facility. And that brings with it a whole host of thorny questions about jobs, local economies and public safety.

But with few options to control rising costs, and a governor resistant to standalone efforts to raise revenue, it may be a choice they’re forced to make, said Sen. Lyman Hoffman, a Bethel Democrat who co-chairs the Finance Committee.

“We have a limited budget. If we are not able to pass revenue measures, we have to look at doing something,” he said. “So this is an idea that is on the plate.”

Alaska Supreme Court Chief Justice Susan Carney highlighted efforts to reduce case backlogs and asked lawmakers to fund new judges and long-delayed courthouse maintenance during the annual State of the Judiciary address on Wednesday.

Carney pointed to a pair of December reports from the Anchorage Daily News, ProPublica and Bethel public radio station KYUK. They told the story of a man who spent seven years in jail awaiting trial for a murder he did not commit, and the victim’s family’s ongoing search for justice.

Carney is also the judicial branch’s chief administrator, and she says the reports remind the court system that it must remain committed to resolving cases quickly and fairly.

“I know that the cases with extreme delay are outliers compared to the vast majority of criminal cases and the time it takes to resolve them, but it’s still heartbreaking to think of the anguish that victims suffer and the problems that delays cause to everybody involved in criminal cases,” Carney said.

But the court system has made significant progress, Carney said. She said courts had cleared a pandemic backlog, with the number of open cases significantly below pre-pandemic levels. She said the number of felony cases more than two years old has been cut by more than half since 2023.

Carney thanked prior chief justices for their work bringing the backlog down, and she says she’s recently put out a new policy tightening existing limits on orders known as continuances, which delay court proceedings.

Carney also celebrated the rededication of the Utqiagvik Courthouse to honor an Indigenous legal pioneer. She called magistrate Sadie Brower Neakok a “trailblazer” and highlighted her commitment to ensuring language access for Indigenous people, starting before statehood.

“She regularly held court at her kitchen table and did it in Iñupiaq when the people appearing in front of her didn’t understand English,” Carney said. “When she became a state court magistrate, she and magistrate Nora Guinn from Bethel insisted that they be able to hold court in the language that their community members understood.”

Carney also came with requests. She asked lawmakers to open the state’s purse to fund a new judge in Palmer to handle the growing workload in the Matanuska-Susitna Borough. The last time the state added a judge to the state’s fastest-growing region was in 2006, according to the court system, and in the meantime, the population has grown 40% and the number of cases filed has risen 55%.

Carney said the court system has tapped retired judges and those from other communities to fill in at the Palmer courthouse to handle criminal cases and other urgent matters, but she said she was concerned delays could mount in other areas without a new judge.

The chief justice also urged lawmakers to fund long-delayed maintenance. She says court facilities across the state are badly in need of repair, including an administrative building in Anchorage.

The building has a crumbling facade, “barely keeping out the elements and the occasional vermin,” she said.

“On the facade, close to head height, so that people passing by can see it, is a great big metal map of the state of Alaska,” Carney said. “I’m sorry to tell you, Kodiak is no longer part of the state of Alaska.”

Fortunately, Carney said the Kodiak-shaped hunk of metal did not land on any passing pedestrians. But she said the episode underscores the dire need to repair and upgrade courthouses.

Key lawmakers have said that despite a large deficit, they plan to prioritize school and state facility maintenance in this year’s budget.