Tangeman resigns, suggests Dunleavy about to propose new taxes

The farewell letter to Alaskans from Revenue Commissioner Bruce Tangeman is marked by a hint that Gov. Mike Dunleavy is about to change direction on taxes.

Deciphering his confusing text, it appears Tangeman is saying that Dunleavy is going to propose taxes and Tangeman is opposed. He says he is leaving his state job, perhaps voluntarily, because Dunleavy needs someone who is “100 percent aligned with his vision.”

What is his vision? Tangeman doesn’t say. He writes that Dunleavy campaigned on no new taxes and still believes in the principle to “not take hard-earned cash from your pocket through new tax schemes.” But in the next paragraph, Tangeman says, “The discussion is turning more and more toward taxes.”

It is possible that Dunleavy will do as Tangeman suggests, as that might be the only way in which Dunleavy survives and finds some path to increase the Permanent Fund Dividend without slashing state services. The Dunleavy budget debacle of 2019, which energized the recall campaign, shows that there is little appetite for wiping out state services among Alaskans.

I suspect that Tangeman will say that his column did not claim that Dunleavy wants to raise taxes. If so, the revenue commissioner should write a second column explaining the first column.

Tangeman dropped more hints than Hansel and Gretel, however, and my guess is that Chief of Staff Ben Stevens, a political realist with knowledge of how the Legislature works, is the main taxing authority who doesn’t see the world the way Tangeman does.

Tangeman says any new tax would be used to “sustain this unsustainable budget,” but he doesn’t name a single program to reduce or eliminate, the tactic always used by those who are not serious about budget cuts.

“It is apparent that many have not accepted the realization that our three decades of spending patterns cannot continue,” he said, without giving a clue about how to get there from here.

The budget is not a math problem, even for the revenue department. And no one in state government is in a better position than Tangeman to say exactly how many hundreds of millions he wants to cut and from where.

He should provide a specific list to back up his sustainable pronouncements. That should be easy for someone who has been in state government and worked on the budget for as long as Tangeman.

Earlier this year, Tangeman spoke in general terms about the benefits of cutting education by nearly 25 percent, about $330 million. He should have mentioned that in his farewell column.

On the public radio program “Talk of Alaska,” Tangeman said last winter that he doesn’t have kids and looks at education “from a disconnected point of view,” but concludes we “spend the most and we get some of the worst results.”

“I don’t know what the solution is to that, but apparently throwing more money after it hasn’t helped solve that problem,” he said.

I wrote this at the time: “That Tangeman refers to an essential state function as ‘throwing more money’ speaks to how disconnected he is from Alaska schools. The right-wing talking point that Alaska schools are failing ignores the complexity of the problem and the reality that many students succeed when they have the right home and family environment.”

Tangeman also repeated false numbers when he talked up the giant budget cut, echoing the comments of former temporary budget director Donna Arduin about how much money was going to the classroom and how much to administration.

“A lot of folks will look at the fact that 52 percent of the revenue for education is going to the classroom, which means 48 percent is not. So maybe that’s part of the restructuring that also needs to take place. I know we hear and we’re seeing it down here in Juneau, X number of teachers will be cut and that’s a horrible discussion to have, but we never hear about how many of the administrative side will be cut,” Tangeman said.

“I know 52 percent, we’re in last place when it comes to that, the amount of funds that are actually going into the classroom. So again, when you mention restructuring, maybe we end up at the exact same dollar amount, but that number changes significantly and goes to 75 percent making its way into the classroom.”

But according to the Alaska Council of School Administrators, the temporary budget director and the revenue commissioner were wrong in claiming that 52 percent of funds go toward student instruction.

“This information is not only incorrect, it also implies there is ample room in district budgets to absorb the governor’s proposed 24.3 percent cut. According to our 54 school districts, based on actual spending, the correct figure for student instructional costs is 74.6 percent,” Dr. Lisa Skiles Parady, executive director of the school administrators group, wrote to legislators.

Tangeman displayed a reluctance to analyze any of the proposed Dunleavy budget cuts last winter and spring, though he supported them. He said there would be no analysis until after the Legislature came up with its own proposals.

“The governor has put a proposal on the table; we’re seeing a lot of theoretical ‘if-thens’ being bounced back at us,” Tangeman said on March 6. “Good questions, but you can’t really analyze ‘if-thens’ until an actual proposal is put back on the table.”

“So we’re expecting to see a counter-proposal, if you will, from the Legislature. That’s their job. The governor puts a budget on the table. Legislature analyzes it and they put their own proposal on the table. Ultimately when we get to that point, then we’ll be able to do more economic analysis on their proposal and then we can start comparing the two options.”

Tangeman tried to make it appear that it wasn’t the job of the administration to describe the impact of proposed budget cuts, but that is an essential difference between empty talk and the real path to a sustainable budget.

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