Governor Palin's Compromise on Stimulus Largely Accepted

Originally Posted April 28, 2009

Alaska Governor Sarah Palin "acknowledged the state legislature’s action to accept economic stimulus funds" (Stimulus, 2009, ¶1) on April 28, 2009, following the legislature's acceptance of much of her compromise offer and their acceptance of her requirement that no state money be committed following the expiration of federal monies. The legislature agreed to use $130 million in stimulus money to replace state general funds for Medicaid and child support enforcement in FY 2009 and 2010 (Stimulus, 2009, ¶6).

The Governor accepted $171 million in education funding, because those monies will go to technology upgrades and teacher training -- items that will not result in an un-funded state mandate (Stimulus, 2009, ¶9).

Governor Palin accepted $15.6 million for unemployment and to finance conversion of medical records to electronic format, which will be federally mandated for all health care providers in 2015 anyway (Stimulus, 2009, ¶14).

These breakthroughs paved the way for the Governor to accept $901 million out of the $930 million offered. Some $28.6 million was rejected, because that money would have required adopting a state-wide energy code (Stimulus, 2009, ¶12), which would be unrealistic for Alaska, and constitute greater federal control over state affairs, or encroachment on the Tenth Amendment.

Also approved were: $20.7 million for community revenue sharing (Stimulus, 2009, ¶10), $28 million for home weatherization and energy efficiency, (Stimulus, 2009, ¶12), and the $461 million previously approved for capital projects.

Alaska's state legislature acted on the stimulus "with passage of House Bill 199, Senate Bill 75, HB81, HB113, and two legislative resolutions supporting receipt of the funds, House Joint Resolution 11 and House Concurrent Resolution 13" (Stimulus, 2009, ¶1). Once she receives all appropriations bills from the legislature, Governor Palin will act upon them within 20 days (Stimulus, 2009, ¶16).

Governor Palin's Concerns About the Stimulus

“I have been clear and consistent about my concerns with accepting economic stimulus funds as our nation incurs tremendous debt,” said Governor Palin. “As I am required to certify that stimulus dollars will create new jobs and stimulate the economy, I acknowledge the legislature’s action. And now I must make sure that, by applying for funds that they’ve resolved to accept, we do not grow government but instead put people to work and grow Alaska’s private-sector economy (Stimulus, 2009, ¶2).”

“We provided the public with the opportunity to weigh in and for them to understand the complicated and evolving federal requirements in this package,” Governor Palin said. “My concern remains that we must acknowledge these are one-time, temporary funds, that the federal government is deeply in debt, and that we must borrow money from other countries to fund much of government (Stimulus, 2009, ¶4).”

The legislature has accepted these stimulus dollars, and my agencies will make appropriate applications for funding. As we move forward, we must continue to exercise fiscal responsibility and prudent planning to develop our resources and build a stronger Alaska, and not assume federal dollars will continue to pay so many of Alaska’s bills (Stimulus, 2009, ¶16).

“Alaskans are strong and innovative as a people and we have great potential because of our vast natural resource wealth. It is my hope that Alaskans recognize this potential and will support efforts to responsibly develop our great state so our families and the private sector can thrive and prosper. Growing government stymies this, so it is with great caution, I am sure, that our legislature resolved to accept federal economic stimulus funds, and it is with great responsibility to future generations that I prudently and conservatively administer the funds (Stimulus, 2009, ¶17)”

Commentary

When it appeared that the legislature was going to blindly ramrod the stimulus package through without regard to the potential consequences of accepting the funds, this author had advocated that Governor Palin veto anything she had not already accepted. But, something happened since the session ended. Much of Governor Palin's compromise offer was accepted! Further, through problem-solving and negotiation, the Governor and the legislature were able to turn lemons into lemonade -- as with the education money going to finance technology upgrades and training, rather than creating an additional burden for Alaska two years down the road.

"The House and Senate finance committees held nearly 20 public hearings and worked closely with the administration to research aspects of the stimulus bill" (Stimulus, 2009, ¶3). Unlike those who passed and signed the stimulus, Governor Palin -- and the finance committees of both houses of Alaska's state legislature read the package and researched it.

Governor Palin's conservatism regarding the relationship of the state to the federal government extends to the relationship between the state and municipalities. This is encapsulated in her thoughts regarding community revenue sharing, to wit: "As a former city councilman and mayor, I support local decision-making instead of growing state government,” Palin said. “Local governments can best meet a community’s priorities and are held accountable for every public dollar spent for local projects and services” (Stimulus, 2009, ¶11). She clearly prefers that as much as possible be done at the local level and with small government.

If Governor Palin was inexperienced as her detractors claim, she would have been soundly defeated on this package. She secured most of what she wanted, including agreement on items that would not be entertained even a week ago. This does not happen because of dumb luck. It is the result of 17 years of executive seasoning and experience -- and something else -- the way Governor Palin made this work is reminiscent of a forebear whose torch she carries -- someone who beckoned us to follow him to a shining city on a hill.

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Final Thoughts on the Stimulus Package as it Pertains to Alaska (April 29, 2009)

This is in response to questions and comments I have received pertaining to this announcement:

Just like at the federal level, a state legislature can override a governor's veto. So, if Governor Palin had vetoed, yes it would have been overridden -- the legislature overwhelmingly wanted that money. Of course, since she is the one signing the bill, those who hate Governor Palin are accusing her of being a hypocrite -- this is why we need to be well-informed about this matter. It's complex, and quite frankly -- dry subject matter -- and easy to just "sloganeer".

Had the legislature not accepted her compromise -- had they just blindly ramrodded it through -- veto would have been the right thing for Governor Palin, and that's what I had been advocating -- even with an override. This would be to put her on the record as having rejected this money.

Once Governor Palin's compromise was accepted and her criteria complied with re: the 33% of the stimulus money she questioned -- she could not now turn around and veto what was agreed to -- when it was her criteria that was agreed to! Doing so would have been a double-cross and a back-stab.

The Governor offered a compromise that she would accept much of the that portion of the money so long as it replaced state funds and the state does not end up funding this stuff two years later when the federal money dries out. The legislators originally were not interested. That was a circumstance for which veto was indicated. That circumstance changed 180 degrees.

The legislators accepted the Governor's compromise. They complied with her criteria. They wrote it into the house bill. So long as this is how the bills are when they reach her desk, then passage is now the right thing. You can't turn around and back-stab people who after a long negotiation complied with most of what you wanted. If she were to do that, Governor Palin would have a hellish remainder of term awaiting her (and with people abusing the ethics complaint system as a political tool, her work life is already not exactly pleasant right now).

Remember too she has 20 days to pass or line item veto once it reaches her desk. If the legislators sneakily remove that which they agreed upon, we'll be back to square one. Hopefully, that does not happen.

Finally, the stimulus package was different for different states. Governor Palin accepted 67% of the money without issue, because it was for capital projects and automatically met the criteria she set forth: no unfunded state mandates and no federal encroachment into state affairs. What was in question was 33% of it and that is now resolved.

Different states had a different mix and different amounts. Each state is unique in how the stimulus was handled. For instance, my home state of NY has a Democrat governor who I refer to as "Obama II" When he's proposing much higher taxes on annual income over $250K -- just like Obama is doing at the federal level -- and supports Obama in every way shape and form, I think the the term is apt. NY accepted its package, lock, stock and barrel with nary a thought as to whether any of this money is poisoned. But, NY is also mainly a Democrat state and the few Republicans we have here are RINOs. For instance, pro-choice Democrat Senator Gillibrand was regarded as a "right-winger" and she is now "evolving" her views. Lovely. NY got much more money than AK, but since this is a liberal state with a governor and legislature on the same page, we took the money without even a thought.

References

Governor acknowledges legislature’s action to accept stimulus funds: $929 million slated for state projects and services. State of Alaska, Governor. Retrieved April 28, 2009 from: http://www.gov.state.ak.us/news.php?id=1792