I wanted to provide an update on federal CARES Act funding, unemployment insurance (UI) benefits, federal PPP and EIDL loans, as well as a short Alaska Marine Highway System (AMHS) update.
On May 1, the Legislative Budget and Audit Committee (LB&A) approved $125 million in federal CARES funding. This included $45 million for K-12 education, $42 million for child nutrition programs, $29 million for rural transportation costs ($10 million to AMHS), $5 million for the University of Alaska and $3.6 million for state and local law enforcement.
LB&A was scheduled to meet again on May 6 to review the governor’s revised CARES funding proposals for $562 million in direct municipal assistance and $290 million in small-business aid. Unfortunately, that meeting was postponed until May 11. As I’m sure some of you are aware, there are conflicting opinions surrounding whether these items can be legally appropriated through the LB&A process, with some members maintaining that full legislative approval is required.
Under normal circumstances, I would agree with that perspective; however, these are anything but normal times. Alaska is in the midst of a health and economic crisis, and we are in receipt of $1.25 billion in federal relief funding, but the Legislature is not in Juneau to approve those funds; further, the Legislature doesn’t appear ready to meet. A little over a week ago, I was strongly advocating for returning to Juneau, but it has become clear that there aren’t enough members in both bodies supportive of that for a quorum.
Should support for reconvening in Juneau change, I am ready to hop on the next plane; however, businesses and communities need relief now, and the only available avenue to fulfil the Legislature’s responsibility of appropriation is to work through the LB&A process.
I’m meeting with House and Senate leadership, our legal team, as well as the governor’s office throughout the week and weekend to work on a solution. I don’t have any certainty on a path forward as I write this; however, I understand how critical this funding is to Alaskans and Alaskan communities. You have my word that I am doing whatever I can to facilitate distribution as quickly as possible. I am hopeful that I can provide a solid update on this by Wednesday of next week.
I know that many of you, particularly 1099 workers, are continuing to have difficulties filing for UI benefits with the Alaska Department of Labor and Workforce Development. Some people are waiting on overdue payments, while some are struggling to get a return call. The department hired an additional 100 staff to deal with the increased workload, but it’s clearly still experiencing significant workload issues.
The department started processing self-employed UI claims on April 20 but did not adequately inform those applicants, who had been filing for weeks already, that an additional PUA application and income verification was needed to proceed. I have asked them to get this information to applicants immediately.
If you are having any difficulties contacting the department or navigating a UI claim, please reach out to my office at 907-465-3271 or Rep.Louise.Stutes@akleg.gov and we will be happy to assist you.
I am also keenly aware that some businesses are continuing to experience difficulties receiving payment for PPP and EIDL loans or contacting the SBA about the status of your applications. I do know that if your EIDL application number starts with a “3,” it is likely stuck in processing; the SBA is addressing those in the order received. My staff is in daily contact with our congressional delegation and the SBA regarding ongoing issues with these programs. If you are experiencing any problems, please reach out to my office at the contact information above.
Taking a moment to address AMHS, I was very disappointed with the governor’s vetoes of $15.5 million from the operating budget and $16 million for crew quarters on the M/V Hubbard. Simply put, this funding was desperately needed to increase service to adequate levels. The public outcry over the winter schedule, or lack thereof, made it clear to anyone listening that ferry service is a priority for Alaskans. The AMHS budget passed by the Legislature this year was the outcome of many collaborative meetings with DOT throughout a public process. In one fell swoop, these vetoes ignored that process, the public and the future of the system. Please know that restoring ferry service is still my number one priority, and I will continue to fight for it with every fiber of my being and resource at my disposal.
I will approach any forthcoming supplemental bill as an opportunity to restore AMHS funding and explore available options to utilize CARES funding to supplement operating weeks that were lost due to COVID-19.
It is worth noting that the governor requested and was granted $10 million in CARES act funding for AMHS. Although the funding will not increase service levels directly, it will be utilized to pay wages and benefits for AMHS employees impacted by COVID-19, as well as absorb costs for additional related equipment and cleaning aboard vessels. If this funding were not available through CARES, it would have likely come from the Alaska Marine Highway Fund instead.
I reached out to DOT this week for the most recent update on the expected return to service dates for Kodiak. The Tustumena is expected arrive from Homer on June 3 but I will be sure to update you if that changes.
Looking to the future, the state of AMHS’ fleet demonstrates the urgent need to remove governance (and maintenance) from the political process. My staff is currently working on revamping our AMHS public/private corporation bill with the goal of getting it passed into law next session. It won’t solve all the system’s ills, such as continued vetoes, but it would facilitate much better long-term planning and decision making. I plan on holding an interim House Transportation Committee hearing this fall to begin the public process on this bill ahead of session next year. I will update you on that as things develop.
There is a lot going on right now, and, typically, there have been more questions than answers. I just want you to know that my staff and I are here for you as a resource for whatever your needs may be. Please reach out to us with any questions, concerns, or suggestions at 907-465-3271 or Rep.Louise.Stutes@akleg.gov.
I hope to provide a much more detailed update on a path forward for CARES Act funding early next week, as well as an update on Alaska’s $50 million share of the CARES federal fisheries relief that NOAA just announced.