Session: State Capitol, Room 107 Juneau, AK 99801-1182 Phone: (907) 465-4993 Fax: (907) 465-3872 Send E-Mail Interim: 716 West 4th Avenue, Suite 500 Anchorage, AK 99501-2133 Phone: (907) 269-0200 Fax: (907) 269-0204

Dear Neighbors,

This session your state lawmakers are confronted with the challenges of addressing the budget gap, exploring ideas for long-term fiscal planning and trying hard to address the needs of our constituents.

First off, I would like to extend my condolences to the family and friends of the five Alaskans who lost their lives on Alaska Airlines flight 261. This tragedy highlights how this country's largest state is also one of the smallest in terms of population. The loss of even a few lives has had a profound effect on all of us.

On Friday, February 6th the Federal Trade Commission undertook a huge challenge when it filed a complaint in San Francisco to block the BP Amoco/ARCO merger. The merger is controversial. I expect you are aware that I oppose the merger.

I believe, as do a majority of the Commissioners on the Federal Trade Commission, that the Charter Agreement signed by Governor Knowles and BP Amoco did not go far enough to protect competition on Alaska's North Slope.

On Tuesday, February 8th, the Joint Special Committee on Mergers, on which I am a member, unanimously voted to oppose both the merger and the Revised Charter Agreement signed by Governor Knowles and BP. Our experts advised us that the proposed merger, as it stands, fails to create a sufficiently integrated entity that would preserve the competition enjoyed between BP and ARCO.

The next day, statewide media reported that BP has funded the legal costs incurred by the Administration in its efforts to implement the agreement to the tune of $1.5 million. I am outraged at the thought that BP is paying the state's legal fees for intervening on BP's behalf in the company's litigation with the FTC. I personally feel that this is unethical and inappropriate.

In early January, the Republican-led majority adopted a new commitment to Alaska based on making state government smaller and smarter and making Alaska safer and stronger.

We are working on making state government smaller by completing the fifth and final year of the Five-Year Plan to reduce general fund spending by $250 million. Your senate and house finance committees are also reviewing and considering the recommendations of the Privatization Commission.

We are working to make state government smarter by forging ahead on results-based budgeting to prioritize government spending using defined missions and measures and promoting the wise allocation of scarce funding resources. The buzz word for this process is "accountability" through achieving clearly defined goals, accounting for budgeted funds and auditing money already spent.

At the same time your legislature is working to make the state safer and stronger. We will do this by seeking an appropriate level of funding for construction and upgrades of primary and secondary schools. We are also seeking ways to promote responsible development of North Slope natural gas, improve our transportation infrastructure and fight for the approval of the National Missile Defense system in Alaska.

A big task for the legislature this session is to deal with the budget deficit and the uncertain future of the Constitutional Budget Reserve.

Senator Jerry Mackie (R-Craig) started the dialogue when he introduced a plan that would provide a final dividend payment of $25,000 to all eligible Alaskans, and then allow a portion of the fund's earnings to be used by the state to meet the fiscal gap. Senator Lyda Green introduced a plan that would preserve the fund's status quo through a constitutional amendment. I am certain that other plans will follow. I am especially interested in hearing any ideas and suggestions that you have in this regard.

In addition to big picture legislation, I and several of my colleagues are proposing legislation that has been specifically called for by our own constituents. This session I introduced Senate Bill 176 that would allow private health club facilities to limit membership to either men or women. Privacy is a fundamental right that is specifically provided for in the state constitution and SB 176 would protect that privacy right by providing for Alaskans of both sexes to pursue the benefits of physical exercise in a comfortable environment. Alaska is following several other states in drafting this proposed legislation.

I have also introduced Senate Bill 193, which deals with complaints from the public regarding employers who illegally withhold final wages from employees. My bill would increase the cap on past wages from $7500 to $20,000 that employees are allowed to retain. The cap increase makes it more feasible for employees to retain attorneys to handle these cases on a contingency basis while still keeping the cases in small claims court.

In conclusion, please continue to keep me informed on your thoughts concerning these pieces of legislation and any other issues that are on your mind. Log onto the majority web site at www.akrepublicans.org to keep up on legislative news and activities throughout the session.

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