By ZACHARY HALASCHAK
Daily News Staff Writer
Fresh out of the legislative chambers in Juneau, Rep. Dan Ortiz, I-Ketchikan, stopped by the Daily News office on Tuesday to discuss the 2018 regular session, which just came to a close Saturday evening.
The big news of the session was the passage of Senate Bill 26, a bill that restructures the way that the Alaska Permanent Fund is set up by allowing draws from the fund’s investment earnings.
The bill, which had both bipartisan support and bipartisan opposition, passed the Senate 13-6 and the House 23-17. Ortiz voted in favor of the legislation, which also has support from Gov. Bill Walker.
Ortiz said that the bill was a monumental step in bridging the state’s deficit and restoring fiscal security.
“We’ve been talking for the last several years how we need to close the budget deficit,” Ortiz said. “And as a part of that discussion everybody has been in agreement — particularity in the past year — that the key piece to that is starting to manage the use of our permanent fund revenue in a different manner.”
“Some of that investment revenue that is generated will go towards funding of essential services, constitutionally mandated services; it will go towards funding of those types of things as well as paying out a dividend,” Ortiz said.
Ortiz explained that the bill calls for a 5.25 percent draw on the fund’s investment earnings for three years, and then going down to 5 percent after that. He said that the fund has averaged about 6.9 percent growth over the past few years, and reiterated that SB 26 would still allow it to grow.
“That should ensure that the fund will continue to grow, albeit at a slower pace than it has been growing, but it should continue to grow and it should continue to keep pace at least with inflation to keep its value,” he said.
Ortiz also noted that this year’s dividend will be $500 more than last year’s dividend.
Given the weeks of negotiations and concessions that went into finally passing the bill, the Daily News asked if there was anything Ortiz wished were different about SB 26.
“I would have been comfortable with a little smaller draw,” Ortiz said. “… I am in favor of enshrining the dividend itself in the constitution because it’s not enshrined in the constitution — I would be in favor of that.”
Overall, though, Ortiz said he is pleased that it passed.
“It certainly is a big step in closing our fiscal gap,” Ortiz said.
Ortiz also mentioned that the Legislature passed additional funding for education for fiscal year 2019. The additional monies will be distributed using a per-student spending formula called base student allocation.
“We were able to secure added funding to education,” Ortiz said. “… $78 this year to the BSA and then an added $40 next year.”
Ortiz said that would add more than $100,000 to the district’s finances.
“A conservative estimate for the local community here based on conservative enrollment numbers, I think you’re looking at a minimum of $180,000 of new funding coming in through the formula next year for schools that will go into the local district here,” he said.
The Legislature also passed operating and capital budgets. And Ortiz said that although “nobody got everything they wanted,” there are still some funds heading to the First City.
He noted in particular that there is $3 million in the capital budget allocated for berth expansion in Ketchikan to allow for larger ships to visit.
“That’s really positive because we have to get those docks expanded,” Ortiz said. “… I was really pleased to see that and we put money into the ports and harbors fund, which all of coastal Alaska benefits from that.”
In addition to $500,000 for the Inter-island Ferry Authority, Ortiz noted that the Alaska Marine Highway System also got an infusion of cash.
“We put $20 million into the marine highway operating fund, and obviously for coastal legislators that was a big win,” Ortiz said. “It highlights how we fully understand that’s our highway, that’s our road system, and we need to make sure that continues to get support.”
Ortiz also sponsored and passed two bills, HB 56 and HB 76, which make the revolving loan funds for fishing and mariculture, respectively, more readily available to applicants — especially younger entrepreneurs.
He said that HB 56 helps out individuals looking to get a start in the fishing industry by “allowing them to access the revolving loan fund for permits, for boats, for equipment, and for a wider variety of things that will help them get started up as business owners.”
“Both of those bills are important pieces of legislation that will help facilitate, and granted in small ways, but help facilitate opportunities particularly for startups and for younger fishermen in allowing them to potentially more readily enter into the fishing industry,” Ortiz said, “not just as deck hands, but potentially as captains and potentially as business owners, if you will.”
According to the legislator, mariculture has a great potential to bolster the economy of Southeast Alaska, explaining that the waters outside of Ketchikan are great for the industry.
“If we can get that mariculture up and moving I think there is a good chance that we can expand the fishing industry a good amount,” Ortiz said. “… That’s going to have a bigger impact in places like southern Southeast Alaska where there seems to be a lot of water that’s (a) prime area for mariculture development.”
Ortiz said that he thinks Walker also “sees a vision” for the potential of growth with mariculture, noting that the governor appointed a mariculture taskforce last year.
“It’s a safe bet that if we lay the groundwork and lay the infrastructure for mariculture enhancement now, 20 years from now we’re going to be doing big business with the Asian markets in that area,” Ortiz said.
House Concurrent Resolution 19, another bill that Ortiz sponsored and passed, would help prevent critical Native languages from going extinct. The legislation would provide the governor with resources to figure out how to fix the problem.
“It’s going to highlight what truly is an emergency,” Ortiz said. “It’s going to allow the governor to appoint, if he signs that bill — and I’m sure that he will — he will appoint a task force and they will be tasked with coming up with ideas and solutions for this problem.”
He pointed out that there are large Native communities in District 36, not only in Ketchikan, but also in places like Saxman and Metlakatla.
“We see some of the elders in some of these different cultural language groups beginning to pass away, the amount of fluent speakers in some of these different languages, the amount of fluent speakers are just dwindling and that’s a real concern,” Ortiz explained.
One of the bills he co-sponsored, HB 44, also passed. That legislation is structurally similar in nature to a ballot initiative called the Alaska Government Accountability Act, which would have limited per diem for legislators if a budget weren’t passed on time in addition to other measures designed to clamp down on perceived influence by lobbyists and special interest groups.
Since HB 44 passed, it is likely that the ballot initiative won’t be on the ballot because of the overlaps between the two.
Ortiz said that although the bill was slightly watered down from its original iteration, he is supportive of it because he thinks transparency and strict ethical accountability is important in the Legislature.
“I was co-sponsor of that and you know, again, I feel for me, it’s an issue,” Ortiz said. “As we move forward whatever we can do to give more faith (to) Alaskans across the state, more faith in the government system, and more faith that the checks are there to make sure that we remain independent.”
“If nothing else, it just draws attention to the issue of ethics and the issue of, again, making sure that we in the Legislature are avoiding as much as possible the influence of special interests and lobbyists and those kinds of things,” he later added.
Ortiz was also supportive of SB 63, a bill that bans smoking in workplaces.
“It certainly had broad-based support both in the Senate and in the House,” Ortiz explained. “And that was because we were hearing from a lot of constituents about their support for the bill.”
“This has been a long time in coming, it’s been a part of the discussion since I’ve been in the Legislature the last four years, but I think it goes back even further than that,” he said.
When asked about how this might impact local bars in the community that allow patrons to light up, Ortiz noted that there is a clause in HB 63 that allows localities to opt-out should they so choose.
“People do need to have safe places to work, they need to have healthy places to work, and the fact that it leaves the local opt-out option, ultimately it will go to the hands of the local city councils and assemblies,” he said.
Also Tuesday, the Daily News asked Ortiz about the upcoming statewide election in November. Ortiz said now that the session has concluded he is turning his focus back to the campaign trail, in an effort to be elected for a third time.
When asked what his strategy for the campaign is, and what his message will be, he said that it will entail a lot of door knocking — something he said he is used to.
“It’s going to be the same,” Ortiz said. “I am going to get out, I’m going to do a lot of walking, I’m going to do a lot of talking to folks — listening, a lot of listening to folks — and make sure I get to as many people as I can in the district, and that means going to all of the communities in the district and it means knocking on doors and hearing what people have to say.”
When asked if he thinks that the House majority’s tri-partisan coalition would remain intact, Ortiz said that he thinks it will. He also said he hoped to retain his seat on the finance committee.
“This year, coming into this election cycle, I feel there’s even a better chance than the last time that I’m going to be part of a majority coalition. I just have that sense that that’s the way things are going to shape out. Now that coalition might be a little different in makeup,” Ortiz said. “… This year I think that there might even be more of a Republican flavor to it, but that’s just my guess at this point.”
He said that being the face of Ketchikan in the state Legislature has had its ups and downs, however he doesn’t regret running or his tenure.
“It’s not always a fun job, but it certainly is a rewarding job,” Ortiz said. “It’s a job I feel very honored to have. So it’s worth it to me to get out there, even on the rainy nights and rainy afternoons, and knock on doors.”
Ortiz, who is an independent, will likely face a challenge from the GOP in November — although a candidate has not yet been announced.
The Daily News will publish a legislative wrap-up with Sen. Bert Stedman, R-Sitka, in a forthcoming edition of the Daily News.