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Thank you.

The legislative session is underway, and lawmakers say they're determined to get work done.

We have a very unique responsibility with the conditions that face our state.

Lots of opportunities, of course.

Lots of challenges, lots of areas to agree on.

Lots of areas to disagree on.

Lots of areas define respect for common ground.

What are the caucus priorities and how will the governor respond to their plans?

We're in Juneau to talk with legislative leadership right now on Alaska Insight.

Good evening.

We're excited to be in the state's capital for this week's episode of Alaska Insight.

Lawmakers have been in session in Juneau for a few days now, and tonight, we're talking with House and Senate leadership about what the big priorities are and what they hope to accomplish over the next few months.

There's a lot to discuss, so we'll get right to it.

In the studio with me tonight is Senate President, Republican Senator Gary Stevens of Kodiak and House Majority leader, Republican Representative Chuck Kopp of Anchorage.

Welcome to both of you.

Thanks so much for being here.

Thank you Laura.

It's such a busy week.

Really appreciate it.

Senator Stevens, start us off.

Give us a snapshot of the Senate caucus priorities and your sense of where the big pinch points might be, especially in negotiations with the governor.

Sure.

Well, that's a good question to start with.

I was just talking with Chuck before we started this about how important it is that the House and Senate leadership are really working together.

Well, we're both bipartisan Democrats, Republicans and both of our caucuses.

So we met yesterday and pretty much agreed on all the big issues.

I think the biggest one that my caucus is really concerned about is education funding, talking about early funding of education K-12.

We know we've had lots of problems in the last year.

And the governor that vetoes veto.

So anxious to address that again and try and do it early so that our districts know what's going on.

Other issues out there, elections reform.

We want to talk about that.

We want to deal with the several other issues that we're dealing with.

The, the balanced budget, of course, that's that's the responsibility of our finance committees.

We want to deal with a permanent fund.

There are some changes that we are working with the Permanent Fund Board to try to make there, and then the retirement and pension issues.

So those are the big ones.

And and another special one I'm anxious to work on is the Arctic Committee that we've appointed and in the Senate.

And are you in negotiations with the governor.

Where do you expect that to do the most work.

So education funding is going to be difficult.

You know, the governor, as I said, veto it last time.

So we're hoping that you'll see the, the reasons to I mean, everybody who, whoever you're from in Alaska, you know, the problems education is facing K-12.

And, my district is starting about closing schools.

Your district has closed three schools.

I believe other districts are, that's a very hard thing to do.

So clearly, I think education K-12 is underfunded, and it's time to put some money into it and make those changes.

Representative Cupp lawmakers started organizing immediately after the election, and as Senator Stevens said, bipartisan coalitions have formed in both chambers.

This is this smooth organization is a departure from recent years.

What do you attribute this to, and how do you think it will affect the work in front of you?

This session?

That's a great question, Laura.

I think it's largely attributable to, intensive door to door campaigns that resulted in thousands of conversations with Alaskans that really identified some unifying themes that were pulling people together and clearly not on the edges of political thought.

And it was clear that Alaska wanted their education system.

As the senator, said to be, have durable, stable, reliable funding for education that could be counted on.

Parents wanted, teachers to stay in the classroom year after year and not have a high turnover.

And, it was clear that that was a priority.

Also, what was, very significantly brought forward was the necessity of recruiting and retaining our workforce so that we had a very, reliable education, transportation, public safety infrastructure in our communities.

We heard from many individuals on the campaign trail that it was hard for businesses and families to feel like they were ready to relocate to Alaska or to our communities when we were making national news for, not having strong education, not having good transportation or, you know, scoring poorly on our public safety record.

So, so being competitive, for Alaska as an employer was attractive.

The senator mentioned a strong retirement.

It's part of that.

It will certainly be a priority for the House to, and a balanced budget, not, not paying, not spending more than we have in not, not going into our reserves to pay, an outsized dividend.

But, you know, looking at what's the most responsible dividend that we can afford, not doing our savings.

And, Senator Stevens said it well balanced budgets, those are things that were very unifying.

And I would say one more thing.

Other than education and recruitment or retention of our workforce and balanced budgets, energy is a really big thing in Alaska right now.

Affordable energy.

Everybody's concerned about, supply.

And a diverse supply into our energy distribution system.

So we're not overly reliant on any one source.

And the legislature is going to be looking at a lot of policy issues that I think will help inform, Alaska Energy Authority and even our, our private, industries.

It kind of in a way where they know they can count on some, state, support and guidance in how we need to outline the next ten, 20 years.

So we're really excited about that.

I'm personally very excited about the collaborative relationship with the Senate.

I was just talking with Senator Stevens before we came in, and the last time it was like, this was I want to say, a little over four years ago.

Yes, but, but we we appreciate the opportunity to work well with the, the Senate and, and collaborate with the governor's office to where we definitely want to get some wins together.

The governor has some important policy calls.

We want to find those wins where we can be pragmatic and and let everybody get a chance to, get a win and not let these two years go by and not have some significant, accomplishments for the legislature and the governor's office.

You know, I think the issue here that that Chuck has mentioned, Representative cop has mentioned that I think it's really important.

A different from last prior elections.

You know, people have said to me, sure, I want my dividend.

I like a big dividend, but I also see my school districts suffering, and I'm willing to give up a little bit of my dividend in order to fund our school.

So I think that's a major change.

You know, in the past, often the dividend has been the big issue, and it's sort of the third rail.

If you touch that, you're dead.

And the legislature.

But I think people have accepted the fact that, education is maybe more important than the dividend.

And thank you for that.

Clarification and, and a little more detail.

Representative Cupp, I asked Senator to lay out priorities and you were doing the same thing.

Do you see for the House caucus?

Are there some different things that you're also focused on that may be different from the Senate?

Or do you feel like you're very closely aligned?

What are those priorities for the House, or are they pretty much in alignment with the Senate?

I feel caucus wise, they're very closely aligned.

The senator also mentioned, elections, reform.

I think we'll see a joint effort between the House and the Senate and the governor's administration on passing an elections reform bill.

We all know there are some things that can improve how we conduct elections in Alaska.

I think that, the the, as you have heard, the, the main things of recruitment and retention of our workforce is making Alaska a competitive employer.

Again.

A real reliable vehicle for education funding that doesn't swing, like a political pendulum each year, give school districts some consistency and predictability and funding really important to the legislature.

And, and staying within a balanced budget structure where we're not overdrawing the percent or market value, 5% of the total market value of the fund.

And, to the greatest extent possible, not going into savings, it's really important to both caucuses.

I think collectively that's going to help produce some real public policy wins that are fiscally responsible at the same time, and give our private sector some confidence that we are paying attention to our infrastructure, which makes them feel safe to invest in Alaska, knowing that we are caring about our roads, our, you know, our our heavy mechanics, our educators and our public safety and our communities and, I think that, you know, that symbiotic approach is becoming more recognized as being important.

Let's drill down on some of the issues that you've been talking about.

The idea of creating a new pension system for government employees and teachers.

What kind of a bill do you think you can craft that could survive a veto from Governor Dunleavy?

Sure.

Well, Senator Diesel has added a bill.

Last year, a Senate bill 88, and she's introducing something very similar again this year.

You know, we realize that we simply cannot go too far.

We we had an old retirement system that I was fortunate to be a part of.

And I think you were joking.

It was a wonderful retirement system, but it was overly generous so that we still owe billions of dollars for that old system, which we stopped over a decade ago.

So we have to find a system, a retirement system that allows people, to retire and have a pension.

But it's not going to be the old system.

I think, actually, Senator Gibson says that it's not your it's not your grandfather's pension.

It's something different.

And, so it has to be payable, has to be something we can we can afford.

And it's going to be, you have to hear from experts on whether what we've come up with the works or not.

Your thoughts.

Yes.

Laura.

So the pension bill, that the House will be carrying which will be very similar to Senator Diesel's bill is truly a dramatically different approach to a defined benefit pension than the state experienced pre 2006.

It is not a there's no health care plan that is, guaranteed to the employee.

It's just a health savings account so they can buy their own health insurance to bridge them to Medicare when they retire.

Secondly, the risk is shared between the retirees, the employers and the employees by a way of if the actuary says the projected liability is is less than 90% funded, so your total assets, fall below 90% of your projected liabilities, then there's levers that kick in that raise contributions.

And even the retirees have skin in the game in that their post-retirement pension adjustment, their cost of inflation can be reduced to keep the plan at 90%.

The.

This is a plan that's been modeled in several states.

It's actuarially very sound.

And the total projected plan increase cost through 2039 as of last year, the actuary said that would be just a whisker over 1 billion, like 1.05 billion.

So if you wrote a check today, present value, that 646 million, or about $45 million a year.

You know, we know that, the governor, Dan Levy, which I fully support him doing an incentive for just teachers or recruiter retention of our teachers.

He has a plan that scores that $60 million a year just to recruit and retain one job class.

The pension that we're proposing, as the senator said, is is not the gilded, not the gilded one, but it's much more fiscally responsible.

And, and it will not bring back the, the, the debt, as you said, from, from the previous.

And that debt is projected to be paid off like a mortgage payment in 2039.

So the state is doing well, on its old pension.

And the new one that's being introduced is dramatically different.

Shared risk and we believe will be something that I think once everybody understands it, we can get the governor support on it.

And, you know, otherwise we wouldn't be be, be advocating.

But we think the House and the Senate together will we'll get some wins there.

All right.

Senator Stevens, Republicans in the Senate have enough members to organize the caucus this session, and they have enough to block three quarter vote, like spending from the constitutional budget reserve.

How will that affect the dynamics in session?

What should we expect?

Things to be different.

You know, that's a good question.

We have a minority, of six.

And, and of course they could stop us on a three quarter vote, but I don't think we're going to need a three quarter vote.

You know, our savings, the, is, is so limited that, you know, it's only like, what is it, like 3 billion in the savings and the governor's projected in this budget, which is totally unreasonable.

Reasonable, using half of that and only leaving a 1.5 billion for the future.

So we simply can't do that.

And and while we're on that subject, I mean, the governor's, enormous, permanent fund dividend, and and including the, drawdown, of the, savings.

It's just not practical.

We simply can't go there.

So we the government had to.

It's his job to present us with the budget.

He did that.

Now we have to work through the details and help everyone to understand that, there's a limit to how much money we have.

Yeah, absolutely.

Let's move to energy representative cap.

Energy supplies for the rural communities.

As you know, Fairbanks Anchorage to Kenai, 75% of the state's population.

A shortage is looming for Cook Inlet gas in just a few years.

What do you think can be done to address this constraint that avoids importing expensive LNG, or is that just inevitable?

At this point?

I think we are going through the work of discovering whether it's inevitable or not right now by looking at, everything from the Bradley Lake Power Project and the Dixon diversion, which is going to bring 50% more power than they're producing now into the grid.

They do provide more than 10% of the entire rail belt's power.

There is a number of projects that are currently in front of the Energy Committee in the House that, could end up significantly extending the life of the Cook Inlet basin.

We're looking at royalty relief, for Hex Fury.

They they have said there they have found a significant amount of gas, but it's a lot of, capitalization cost to get a drill rig and drilling on.

And they said with a little royalty relief, they're convinced they can provide another 5 or 6 years of gas.

In fact, they signed a contract with NCAR, saying that, you know, we know works that we still have to get it and we're going to need a little royalty relief.

But extending out that timeline in the Cook Inlet basin actually allows the producers to find more gas.

But to do that, we do need to bring in more of a diverse, you know, sources of power.

Some of what, the Alaska Energy Authority is doing right now is looking at, they've already been awarded significant grants to upgrade our transmission lines between Homer, Soldotna, Sterling and Anchorage.

We have a 20% power loss on our lines.

Imagine if you can save 20% power because our lines are so old.

But so upgrading our lines will be using less power.

There are a number of projects out there that would bring power into the grid.

West Susitna.

Access have.

There's, Alaska Energy Authority is looking at clean coal power out there for hundreds of years where coal they can you know, big power generation plants that use clean coal technology.

That would be just a few years to get those online versus, you know, some projects are seven, ten, 15 years or so.

There's a number of things out there.

But if we have to import, you know, the utility companies, that's their job to make sure they've got the gas and that we that we don't freeze up.

And I wish we could all be like Kodiak, where the senator lives, where they have what are you, 100% renewable power and a renewable but, only, because the state was generous and helpless to put in that, the dam, the and the hydro project.

So I think an important issue is that, we're all in this together.

I mean, my community, is doing well, other communities are not, homeowners in my district.

They would be affected, sewer be affected.

So, yeah, we all have to work together to make this work.

And, you know, there are worse things than having to import gas for a limited amount of time.

You know, some of the projects, as you mentioned, are you're talking about years and years.

So if there is a, a brief time in between our projects coming online and now where we have to import gas, that's the worst things can happen.

Well, so let's let's talk about the prospect of a gas line.

Alaska's longed for an LNG line for decades, a Fairbanks resident sent me a headline from the Fairbanks Daily News minor from the 1950s, talking, touting a gas line.

Do you have faith that this new effort could get it done?

Representative copper, your thoughts hope springs eternal.

I you know, I would love to see that for Alaska, not only because of the long term energy, delivery to to Fairbanks and all of in southcentral, but for the jobs economy, a mega project certainly would revive our economy.

I think we need to carefully vet it, you know, to learn what the economics are of the project, who the buyers would be.

You know, does the wellhead value of a delivered gas product minus all the cost of transportation to whichever country it's going to you?

Does it make sense in the world market with the other LNG export that that we know is going on?

We're being asked to, approve capitalization of $50 billion and there's a lot of energy projects that also would say, well, would you please consider me, you know, I have a shorter timeline and I'm a sure thing, you know, so so that's kind of the politics of it.

But would we like it?

Gasoline.

Yes.

We've looked right.

But it's a pretty simple.

Yes.

Yeah, yeah, yeah.

But but but vetting it and, and making sure that it's the best thing for Alaska to do right now as far as that level of commitment is what's happening right now.

And I'm certainly like I said, hope springs eternal.

We'll see.

Well, yes, Senator, I did want you to president, President Trump has been very supportive of, of Alaska on the gas line.

And I hope that turns into some financial assistance.

I mean, you talked about the the money that it has to get into it and whether we can afford that or not.

But if it becomes a national issue, then maybe funds will be available with our funds to actually accomplish it.

Yes, I know that, Senator Bethel, Senator Democrat Lyman Hoffman had said, will the federal government pony up if there?

Yeah.

Laura, that's that's a great question.

And Senator Stevens just hit the nail on the head.

President Trump has said it is a national security energy project critical to the domestic energy supply of the United States.

And as Senator Stevens has just said, if that's true, then we would love to see the economic support for that progress from our national government.

I mean, we would love to have that be a priority for the United States, right?

Yeah.

Senator Stevens, President Trump signed a slew of executive orders in his first couple of days.

One rolled back many of the restrictions the Biden administration had put in place on land and water to limit oil and gas production.

President Trump said he wanted to unleash Alaska's extraordinaire free resource resource potential.

The order opens the Arctic National Wildlife Refuge, more of the National Petroleum Reserve revives the Ambler Road and others projects.

Will this matter?

What kind of effect do you think that will have on the industry?

Will they come if the door is open?

Well, we can only hope and we will see, you know.

So I really applaud the president in making those, those changes.

You know, on the other hand, we, we have to make sure that we protect our natural resources, and it's not like, it's not like we're allowing anybody to come in and destroy Alaska.

Senator Jesus said, we're not a colony.

We're not a colony.

Not anymore, since the Russians left.

And so we really need to make sure that, the waters and the land are protected.

And we will do that.

We have the power to do that.

The state of Alaska has the authority to do that.

So certainly apply the president and most issues.

I don't really like his, his comments on Denali, but, I think we will not take umbrage at that or renaming Denali.

But other than that, the issues that he was talking about, it very, very important.

And I'm glad he's done what he has done.

Your thoughts, Representative Clark, I would second what Senator Stevens said.

I'm very excited about the philosophical change, of Alaska being looked at for its resource potential, which can be a tremendous asset to the United States at a time when there's a lot of global uncertainty.

And so whether it's critical minerals or oil and gas, it is, you know, the mindset is being switched from keeping Alaska locked up as a national park to realizing that responsible resource development is in our national security interest.

And as Senator Stevens said, that Alaska has always done a great job of protecting the environment.

That doesn't mean we're going to be, using that as an excuse for, for poor development.

Practices.

But, it's an exciting time for Alaska, I think, for our jobs, economy, for for industry.

You know, it should be a good four years for Alaska.

Senator Stevens, another executive order signed by President Trump just froze $132 million in clean energy projects for rural Alaska Hydro solar wind, including two large wind turbine projects in Kotzebue that are now in limbo.

Tribes were awarded these grants and now they're on hold.

How disruptive will this be for advancing energy and infrastructure projects, especially in rural Alaska?

Is there anything the state can do?

Well, certainly it could be quite disruptive.

And, you know, we work very closely with our congressional delegation, our two senators, and our new representative, and we will continue to do that.

And hopefully they can have an impact on on those decisions.

But, yes, it could be quite disruptive.

Representative Kopp, do you have anything you'd like to add there.

Yes.

I think, you know, sources of power for rural Alaska are, are critical.

They're rare.

That's why we have power cost equalization right.

Is because it is hard for affordable energy to be leveraged over Alaska.

So this does concern me.

I do think that, particularly our, our tribal communities, villages in areas around the state that have renewable power, clean energy that should be a high priority of our government.

I'm not familiar if they were a frozen like, permanently or frozen to study or to be renewed.

I'm not that familiar with the whole policy call there, but it does concern me that if projects are are being advanced and and awards already, given that we would, star power that that, the traditional power of shipping diesel fuel out or other ways is very, very expensive.

If we can keep our communities powered with clean energy, that's what's in Alaska's interest.

Absolutely.

Well, I want to thank you both so much for taking time to be here this evening, when I know it's a very, very busy time for you.

So I appreciate that you came in and to visit with us and talk to Alaskans.

Good to see you.

And I hope you come back at the end of session to see how we did.

I would love to do that.

Thank you for the invitation, Laura.

It's been great to be here.

Thank you for being with us.

There are big issues facing our state that require collaboration and thoughtful decisions for ensuring the future economic, social and cultural health of Alaska.

You heard some of the top legislative priorities this evening.

Remember, it's up to all Alaskans to make their voices heard with their elected officials.

The first session of the 34th Alaska Legislature is now underway.

Engage in democracy and make sure your community's needs are known.

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Thanks for joining us this evening.

I'm Lori Townsend.

Good night.