Dunleavy amendment would strip Alaskans of constitutional right to raise taxes by initiative

For two years Gov. Mike Dunleavy has been saying he wants three constitutional amendments to be the foundation of his mythical “permanent fiscal plan.”

The Legislature rejected all three in 2019-2020, which was the right thing to do.

One of the strengths of the Alaska Constitution is that a constitutional amendment cannot be placed on the ballot unless two-thirds of the Legislature agrees that the idea has merit.

The meritless amendments are back in 2021. And they should be rejected again.

One amendment is for a state spending limit, a universally popular idea as long as it is discussed in vague enough terms that no one has any idea what it means.

That’s what we have with the imaginary Dunleavy plan for the future of state finances and services. There is also an amendment regarding the Permanent Fund and the dividend, which I will deal with another day.

The third amendment on the Dunleavy menu would require “that any new tax proposal is put before the voters of Alaska.” That is how the plan has been marketed for the past two years.

“I’m proposing a constitutional amendment that requires a vote of the people to approve new taxes. When it comes to new revenue ideas, Alaskans must be involved,” Dunleavy says.

We have yet to see the text of 2021 Dunleavy amendment to find out if it is the same plan he offered two years ago.

The publicity campaign for the 2019 plan was deceptive from Day 1.

What Dunleavy and his representatives didn’t bother to explain was that his amendment was aimed at stripping Alaskans of a fundamental right they have under the Alaska Constitution, the ability to raise taxes by the initiative process. The initiative cannot be used to dedicate money for projects, but it can be used to raise taxes.

Dunleavy salesmen Mike Barnhill and Bill Milks disguised the matter in testimony to the Senate Judiciary Committee in 2019 by not making it clear that the Dunleavy plan was to ban Alaskans from instituting a tax by initiative.

Barnhill invented the claim that the amendment would make the Constitution more efficient.

In fact, it would make it more difficult or nearly impossible to raise oil taxes, fish taxes, mining taxes, bring back the income tax or state a statewide sales tax or any other tax.

What the amendment really would have done is require that any tax initiative approved by the voters would also have to be approved by the Legislature before taking effect. And any tax approved by the Legislature would have to be approved by the voters before taking effect.

This two-step process would make it far more difficult because killing a tax bill in Juneau is relatively easy and there are many ways to do it.

During the 2019 Koch Network/Dunleavy budget flim-flam parade, Dunleavy administration officials kept talking about the dangers of how a “predatory tax” would be bad for business.

The former textmaster and attorney general, Kevin Clarkson, was one who mentioned “predatory tax.”

“So for industry, we want predictability for them so that they can come and invest in Alaska without having to worry about the risk that Alaska will continue to spend like crazy and then decide to pay for that spending through a predatory tax on industry,” he said at the Anchorage road show.

"If the people by initiative create a new tax, which they can, it will only be effective" if the Legislature approves it, he said.

A predatory tax is in the eye of the beholder.

Dunleavy, Clarkson and the Koch Network view each and every tax as predatory, even if most Alaskans see room for new taxes as a reasonable way to pay for public services. Instead of protecting Outside businesses, the state should be preserving the rights of Alaskans.

Alaskans should not surrender their ability to enact tax policy through the initiative process.

And there is no reason to ban the Legislature from raising taxes on its own, unless the intention is to cripple government services, which seems to be what the Koch Network and Dunleavy would like.

We have a representative form of government in which 60 legislators and the governor are called upon to set public policy on taxes. the state budget and state services, acting on behalf of all Alaskans.

Tradeoffs have to be recognized and dealt with, along with the natural tension over how to pay for services. None of these matters can be dealt with in isolation, which is why the Alaska Constitution does not need Dunleavy’s recycled amendment.

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