In the race to get federal COVID help out to Alaskans last month, the state made a critical mistake the Legislature needs to fix. Fast. Many Alaskan-owned small businesses are at the end of their ropes, and federal dollars are trickling out to a few instead of flowing to meet the needs.
When Gov. Mike Dunleavy submitted his plans to parcel out federal COVID help, he used a tool that can only get an up-or-down vote from the Legislative Budget and Audit Committee. It’s a wonky process that lets a governor put out additional, unexpected funding using existing programs.
The Legislature’s nonpartisan attorneys warned that constitutionally, parts of Gov. Dunleavy’s plan needed the full Legislature to act — not just a committee. Still, to get help to Alaskans as soon as possible, the committee approved the governor’s plan. Predictably and immediately, an Alaskan filed a citizen lawsuit claiming the process was unconstitutional. That got the Legislature to the Capitol to approve the funding, again using a method that gave us an up-or-down vote with no chance for changes. Senate Democrats were very vocal about both the constitutional problems and the holes in the governor’s plans. But we decided not to stand in the way of getting these funds to Alaska communities and businesses.
But haste made waste. Gov. Dunleavy’s original plan to give much-needed grants to Alaska businesses cut out any business that got help directly from the federal government. A Paycheck Protection Program loan to keep your employees working or an Economic Injury Disaster loan to keep the lease paid meant no shot at $290 million in grants through the state. When the Legislature took our up-or-down vote, the Dunleavy administration led Alaskans to think they had a work-around. They put it on the Department of Commerce, Community and Economic Development website. But after the Legislature adjourned, Alaska small business owners learned it wasn’t really so. The shortcuts meant we were stuck with the governor’s first draft.
So how many Alaska small businesses are getting grants? In the first week, nearly 1,200 of Alaska’s roughly 70,000 small businesses applied — 51 got approved. The money isn’t getting where it needs to, largely because the Dunleavy administration’s rush made so many ineligible.
Alaskan-owned small businesses create tens of thousands of jobs. They need to survive the pandemic if our state is going to have an economy. From restaurants to architects, mom and pop shops to local tour companies, our neighbors are struggling to keep their doors open and Alaskans working. Every day, these Alaska entrepreneurs come closer and closer to shutting off the lights, losing their savings, and costing more Alaska workers their jobs — none of which was caused by their own actions. They’re bearing the cost of saving lives from the COVID-19 pandemic.
How do we fix it? Legislators need to call ourselves back into session and revise the grant rules so businesses that got a little help from Uncle Sam can still get a hand from the state grants. In May, we showed the Legislature can focus on the emergency and act fast. It could happen in five days.
Senate Democrats call on our colleagues to bring the Legislature back into session and get Alaska small businesses the relief they need. We must act, and we must act quickly.
The Alaska Senate Democrats are Sen. Tom Begich, D-Anchorage, Senate minority leader; Sen. Jesse Kiehl, D-Juneau; Sen. Elvi Gray-Jackson, D-Anchorage; Sen. Scott Kawasaki, D-Fairbanks; Sen. Donny Olson, D-Golovin; and Sen. Bill Wielechowski, D-Anchorage