House finance DEC subcommittee adopts FY26 operating recommendation, rejects funding for Clean Water Act 404 primacy

The House Finance Department of Environmental Conservation Subcommittee adopted its fiscal year 2026 operating budget recommendation and declined an amendment to restore funding for state primacy of Clean Water Act Section 404 permitting during a March 6, 2025 meeting.

The subcommittee approved a recommended package that totals $114,860,200 across fund types — $23,384,200 in unrestricted general funds, $23,922,100 in designated general funds, $24,640,900 in other funds and $42,913,000 in federal funds — and includes 558 permanent full‑time employees and nine temporary positions for a total of 567 positions. Tim Clark, staff to Chair Hannan, summarized the subcommittee report and its staffing and dollar amounts to members before debate.

The report accepts most administration budget items but explicitly declines the department’s request (listed as item 8 in the report) for $1,450,000 to pursue state primacy over Clean Water Act Section 404 permitting. The report does add $126,400 to fund an environmental program specialist 3 position for the commercial passenger vessel environmental compliance program (item 9).

Representative Rauscher moved amendment number 1 to the working document; the transcript does not record the amendment language verbatim but discussion indicates the amendment would have restored or funded state primacy work that the subcommittee report declines. Rauscher described the change as a measure to "shift[] streamlining permits, improve[] state oversight, and eliminate[] redundancy," saying the effort would shorten delays caused by overlapping federal and state permits. "This is a very important step toward us coming onto our own," Rauscher said.

Representative Cupp supported the amendment as a local‑control issue, saying, "I disagree with removing the money from this program. I think that our departments have shown considerable adeptness at regulating wetland issues in Alaska." Representative Harris cautioned that primacy would create an ongoing, multi‑million dollar state obligation and said legal uncertainty remains following a recent Supreme Court decision; Harris noted the Army Corps of Engineers has not provided definitive guidance on how its program will look going forward. "Even with a desire for more local control, what this program would look like is unclear right now," Harris said.

Other members expressed concerns about the timing, scope and capacity implications of assuming primacy. One member said the state currently faces hiring challenges for the technical staff that primacy would require and described the proposal as an "incomplete plan" that could create confusion rather than expedite permitting if implemented without additional resources.

The amendment failed on a roll‑call vote of four yeas and four nays. The roll call in the transcript records the following votes on Amendment 1: Representative Costello—yes; Representative Rauscher—yes; Representative Tilton—yes; Representative Cupp—yes; Representative Josephson—no; Representative Meares—no; Representative Holland—no; Chair Hannan—no. With four yeas and four nays, the amendment did not pass.

After the amendment failed, the subcommittee moved its FY26 DEC operating budget recommendation out of committee with attached legislative finance materials and directed the Legislative Finance Division to make any necessary conforming or technical changes. The subcommittee thanked Legislative Finance staff and DEC officials for assistance and adjourned at 12:50 p.m.

Votes at a glance

• Adopt working document: "I move that the subcommittee adopt the Department of Environmental Conservation draft BA report and corresponding budget as our working document." — Mover: Representative Myers (mover listed in transcript). Objection on the record was removed and the document was adopted as the working document (adopted by committee procedure; no roll call recorded).

• Amendment 1 (restoration/funding for state primacy, details not specified verbatim in transcript): Mover: Representative Rauscher; Outcome: failed; vote 4‑4 (yes: Costello, Rauscher, Tilton, Cupp; no: Josephson, Meares, Holland, Chair Hannan).

• Move report out of committee (FY26 DEC operating budget subcommittee recommendation): Mover not specified in transcript; Outcome: approved (subcommittee moved the recommendation out with attached legislative finance reports and directed technical conforming edits).

Context and next steps

The subcommittee’s recommendation rejects the $1,450,000 request tied to pursuing state primacy for Clean Water Act Section 404 permitting but funds a new commercial passenger vessel environmental compliance specialist. Members debating primacy cited competing priorities in the budget, uncertainty following a recent Supreme Court decision and pending guidance from the Army Corps of Engineers as reasons to delay a state takeover of parts of the federal permitting program. The Legislative Finance Division is charged with preparing conforming edits to the report before the recommendation proceeds in the legislative process.