|Protecting Your Rights: Serving Sand Lake, Spenard, and Turnagain|
|April 19, 2017
Dear Friends and Neighbors,
Easter Sunday was the 90th day of Legislative Session. And on Saturday, the House passed the fourth and final piece of a responsible action plan for Alaska. As the Senate considers the legislation, the budget will remain our top priority and we’re committed to working together.
Revised House Bill 115: The Education Funding Act
Last week, we wrote about the four pillars of the House’s responsible action plan. We made responsible budget cuts in House Bill 57, we restructured the Permanent Fund in Senate Bill 26 while protecting a Dividend, and we updated the oil and tax credit system in House Bill 111. Over the Easter weekend, the Alaska House passed the fourth and final pillar of a responsible action plan. House Bill 115, the Education Funding Act, passed the House 22-17. HB 115 creates new state revenue via a modest progressive tax and directs the revenue into the public education fund.
The Education Funding Act creates a bracketed tax based on federal adjusted gross income. It targets every person who earns income in Alaska so Alaskans and out-of-state residents who work in Alaska will contribute. The bill includes a $4,000 personal exemption that applies to every person in a household. Permanent Fund Dividends are also exempt from taxation and the bill includes a provision allowing use of the Permanent Fund Dividend to pay the school tax. HB 115 will raise an estimated $687 million for the Public Education Fund once fully implemented, including $80 million from nonresidents who work in Alaska but don’t contribute to essential state services.
HB 115 is a direct response to the Senate’s proposed $69.3 million dollar cut to education. The Senate’s proposed cut amounts to a $265 loss per student. Supporting public education is one my highest priorities—and the right to public education is protected under the Alaska Constitution. Article VII, Section 1 of the Alaska Constitution requires the Alaska Legislature to “establish and maintain a system of public schools” in Alaska. Our children remain our best investment for the future.
In comparison, the School Tax bill that I introduced (House Bill 146), will raise an estimated $540 million. The major differences between the School Tax bill and the Education Funding Act are the floor and cap. The school tax bill starts with a $100 tax for all individuals whose adjusted gross income is less than $20,000, ensuring everyone contributes. At the upper end, HB 146 has a cap on the tax ($8,500 tax at $250,000 adjusted gross income) that would leave capital available to invest in the economy. The Education Funding Act, HB 115, does not require a contribution of people with an annual income of less than $10,300 and does not have a cap. The following are estimated examples of tax liabilities for various income levels under each bill:
Now that the House has successfully passed all four pillars of a responsible action plan, the Senate will review the legislation and provide their perspective.
Since the beginning of the session, the two bodies of the legislature have produced 351 bills. 237 bills come from the House, while the Senate has introduced 115 bills. As of Day 90, the House passed 51 bills, but only 14 bills have passed both the House and Senate, nine of which are House bills.
In addition to working on a financial plan, my office has worked on the following bills that passed the House:
Anchorage Constituent Hours
When: Saturday, April 22nd, from 2:00 PM to 3:00 PM
This weekend, I will be back in Anchorage and available to meet with constituents at the Rustic Goat at the corner of Northern Lights Boulevard and Turnagain Street.
Please feel free to come by to check in and share your suggestions and comments.
This week, we say goodbye to our wonderful staffer Owen Phillips. Owen has been accepted into one of the country’s leading Chemistry PhD programs at Georgetown University and he leaves us to pursue further studies. Owen has been responsible for several pieces of legislation this session and his hard work will be truly missed. We wish him the best of luck in Washington D.C.!
Mark your calendar for these upcoming events:
Alaska Historical Commission Meeting
When: Monday, April 24th from 9am to 11am.
The Alaska Historical Meeting will hold an open meeting to discuss the Fourth Avenue Theatre’s future. The commission will be considering the theatre’s historical status and options for its preservation. The meeting is open to the public and any person or group wishing to address the commission on this topic is invited to participate. The public comment session starts at 9:45am.
Chester Creek Flooding Project - Open House
When: Wednesday, April 26th from 5:30pm to 7:30pm.
Come review alternatives proposed for the Chester Creek Flooding Draft Design Study Report that addresses flooding issues in the project area. The Municipality will be gathering public feedback on the proposed solutions.
As always, please let us know if you have any question or concerns.
Rep. Matt Claman
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