ANCHORAGE — In the final weeks of his bid for re-election, Sen. Mark Begich has faced heavy criticism of his performance in his previous job as Anchorage mayor, specifically on his handling of city finances near the end of that five-year tenure.
Just after Begich’s run leading Alaska’s largest city ended in early 2009, when he became a senator, city officials announced Anchorage had a $17 million revenue shortfall, mostly from faltering investments in a downturning global economy. But Begich’s detractors — including his Senate opponent, former Alaska Natural Resources Commissioner Dan Sullivan — say Begich failed to see the danger of the economic recession and failed to warn the city Assembly while negotiating long-term labor contracts and passing a new budget.
Sullivan’s campaign and his other supporters have also linked what they call Begich’s dishonest, “tax-and-spend, liberal policies” as mayor to what they and national GOP operatives say is reckless federal spending by a Democratic-led U.S. Senate.
Begich refuted those claims this week and said his opponent’s backers are outsiders trying to mislead Alaskans by spending millions of dollars on campaign ads. The budget deficit was solely a “paper loss” from poor returns on investments, Begich said.
The argument from the other side goes like this: According to city records cited by the Sullivan campaign, Anchorage’s budget grew by more than 47 percent under Begich, and property taxes went up 6.6 percent in 2004 and 2.8 percent in 2005, with Begich asking for an additional raise later.
The Sullivan campaign and the Alaska Republican Party, in statements attacking Begich, have mentioned multiple times an Anchorage Daily News story from 2009 about worries from within Begich’s mayoral administration prior to the Assembly agreeing on city labor contracts and spending plans. Then-Mayor Begich’s top finance executive reportedly warned him of a potential budget shortfall and recommended freezing all city hiring and stopping discretionary spending.
According to the past news accounts, Begich failed to mention these concerns to the Assembly. The result was a wave of budget cuts and layoffs carried out by his successors, a situation that was later helped by improving investments.
Now, Sullivan and his supporters are using that part of Begich’s record as mayor to question his honesty.
“Mark Begich created a mess that had to be cleaned up,” says former city budget director Cheryl Frasca in an ad by American Crossroads, a political action committee formed by Republican strategist Karl Rove. “I don’t think this is how a leader should behave. I think it’s disrespectful to the institutions that we have.”
The ad is in heavy rotation on Anchorage and Fairbanks television stations, as is an ad for Begich that defends his record as mayor.
During a news conference in Anchorage on Monday, held at a intersection Begich touted as one he helped make safer while he was mayor, the freshman senator said he had made many accomplishments while leading the city. Begich said investments the city made in that time helped, rather than hurt, Anchorage’s rebound from the recession.
“We are proud of the work that we have done here together,” Begich said flanked by two current Assembly members, one former Assembly member and about a dozen other supporters. “And let me make it very clear, no outsider or billionaire political agenda is going to stop that.”
“This is Alaska’s Senate seat. This campaign is about Alaska’s future. It’s not about the past. It’s not about Karl Rove. It’s not about the Koch brothers. And it’s not about Obama,” Begich said. “It’s about Alaska’s future, what we want to see from this day forward, from this generation and generations to come.”
Begich echoed what his own campaign ads have started to say recently: His mayoral administration inherited and eliminated a $32 million budget deficit and managed to balance the city’s budget every year he was mayor, as required by law.
And, Begich said, his administration ushered in investment on things like more police officers and firefighters, two new middle schools, road improvements and the Dena’ina Civic and Convention Center.
"We built this city (and) prepared for a recession,” he said. “We built it to last.”
Begich said about 40 percent of the property tax base that helped that growth came from new development, proof that city leaders had made Anchorage an attractive place for developers to invest. Because of that, the city was not hit as hard by the recession as elsewhere in the country, he said.
Anchorage voters and the Assembly were as involved in those moves as much as he was, Begich said. Begich said criticism by some of the more-conservative Assembly members from that time — and who have recently said Begich misled them about the city’s financial situation — were “old, burned-out, worn-out excuses.”
“They had more information than they could ever handle,” Begich said of the Assembly. “We laid everything out.”
Asked if there were warning signs that he wished he had identified better for the Assembly, Begich said it would have been difficult to predict the extent of the recession’s impacts.
“You always look back, and you always want to think about what you could’ve done differently, but I believe we did the right thing,” Begich said.
For example, Begich said, Businessweek magazine declared Anchorage a city that was recovering the fastest just a year into the recession. That was due to the investment, he said.
“Did we ever predict what was going to happen into the future? It’s hard to do that,” Begich said. “But the fact is we responded, and we made sure the Assembly was well in tune, but we made sure we made investments. The best test of this is how did we survive this recession? And Anchorage survived pretty darn good.”
Begich acknowledged he had called the Monday news conference because of concern that the attack ads from Sullivan’s supporters would sway voters.
“I honestly believed that people wouldn’t buy this, and I’m a little nervous that they keep saying this so much, because they have so much money,” he said. “It’s unbelievable, the millions of dollars they’re spending right now to put this misinformation out there.”
Asked Tuesday to respond to Begich’s comments, the Sullivan campaign did not provide a response directly from Sullivan. A campaign spokesman, who was traveling with Sullivan to Soldotna for a debate, referred questions to his deputy campaign spokesman in Anchorage.
The deputy campaign spokesman, Thomas Reiker, said Begich had been running on his failed record as mayor and was now trying to rewrite that record.
“The truth is that he left Anchorage in a financial hole that cost city workers their jobs and led to steep cuts in city services,” Reiker said in a written statement.
Sullivan would have done things differently and been forthright with the Assembly and Anchorage taxpayers, Reiker said.
“Dan would have shown real leadership instead of following Mark Begich’s strategy of kicking the can down the road and racking up bills Anchorage couldn’t afford,” Reiker said.
--
Editor's note: Sen. Mark Begich and Dan Sullivan have each been the subject of numerous attack ads during their campaigns for U.S. Senate. The Daily News-Miner asked both candidates to list the most unfair accusations. This is the first in a series of ad checks on those issues that the Daily News-Miner plans before the Nov. 4 election.
--
Staff writer Casey Grove is the News-Miner’s Anchorage reporter. Contact him at 907-770-0722 or follow on Twitter: @kcgrove.
