House Finance Committee adopts committee substitute for governor's supplemental (HB 289) as working draft
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Summary
The House Finance Committee on Feb. 13 adopted committee substitute version G for House Bill 289, the governor's supplemental appropriation, setting an amendment deadline of Feb. 16. Staff said the CS combines governor and committee items, relies on a Constitutional Budget Reserve draw and includes contingency language tied to FEMA reimbursement.
The Alaska House Finance Committee adopted a committee substitute (version G) as the working draft for House Bill 289, the governor's supplemental appropriation, after staff walked members through red-line changes and members resolved objections.
Ken Alpert, staff to Committee Chair Josephson, told members the substitute merges supplemental items from the governor's operating and capital requests and committee additions. He described the CS as largely technical and stylistic conversions between administration drafting and legislative legal form, but highlighted several policy and numeric items: a $70 million Department of Transportation capital match transferred in from the governor's capital bill; a $40 million disaster-fund payment from the governor's operating request and an additional contingent $35 million that would take effect if federal FEMA reimbursement for Typhoon Halong remains at 75% rather than 90%; and a $55 million appropriation to the fire fund.
Alpert said the CS restructures certain fund transfers so the net effect is a single Constitutional Budget Reserve (CBR) draw rather than multiple draws. Based on the fall revenue forecast and the bill's line items, he put the CS items at roughly $408 million, noted an underlying FY26 deficit of about $51 million, and estimated a total CBR draw to cover the bill's items of about $460 million. The CS also includes $30 million in "headroom" that could raise potential CBR exposure to about $490 million.
On policy changes, Alpert noted the CS extends the Alaska Marine Highway System appropriation from a calendar year to a multi-year appropriation (to 6/30/2027) and removes a discretionary $1 million statehood defense appropriation to the Department of Law. He described technical corrections and resequencing throughout the bill and pointed committee members to the red-line and transaction-detail materials in their packets for numeric specifics.
Members debated the size of the supplemental and the CBR reliance. Representative Ballard expressed concern that large dollar amounts had been added with limited review time; Alpert and Director Lacey Sanders of the Office of Management and Budget confirmed the CS identifies the CBR as the funding source for FY26 shortfalls absent other choices. Alpert reminded members that Article IX, Section 17(c) of the Alaska Constitution requires a three-quarter vote of both bodies to enact a CBR draw.
After discussion and the removal of several standing objections, the chair announced version G would become the working draft. The committee set an amendment deadline of Monday, Feb. 16 at 10:30 a.m.; members were told to use the amendment template on the Legislative Finance Division website and to coordinate with LFD for numbers and Legislative Legal for language drafting.
The committee did not record a roll-call vote on the substitute in the hearing transcript; committee minutes indicate the chair heard objections and members removed them, allowing the CS to proceed as the working document.
The committee will resume on Monday, Feb. 16 to consider filed amendments and continue review of HB 289.
