Sunday, September 3, 2017

"Must Read Alaska" goes out of bounds in an effort to score political points ...

In a column published yesterday blog Must Read Alaska went out of bounds in an effort to score political points. Sometimes you have to throw the flag.

The out of bounds play was a column by so-called "Senior Contributor" Art Chance attempting to take Senator Bill Wielechowski to task for his recent lawsuit seeking restoration of the PFD.  Chance asserts that the "loss was predictable because the whole thing was just playing for the people in the cheap seats. He never had a real chance." Wielechowski lawsuit was pure political theater,"  https://goo.gl/RmSmBm.

From my perspective as a lawyer who at various times was part of the legal group that advised the Secretary of the Air Force and his staff, was Senior Vice President and General Counsel of the then third largest natural gas company in the United States, and then subsequently, a partner for 23 years at two of the globe's largest law firms, Chance (who I can find no evidence ever was a lawyer) is wrong. While I am not a big fan of Wielechowski politically, his suit was well grounded; in fact, if I had been asked to join I likely would have done so.


The constitutional provision around which the lawsuit ultimately centered is the so-called anti-dedication clause contained at Art. 9, Sec. 7, https://goo.gl/fEJpuZ.  In relevant part that section provides:
The proceeds of any state tax or license shall not be dedicated to any special purpose, except as provided in section 15 of this article or when required by the federal government for state participation in federal programs.
As is clear from the words, on its face the provision applies solely to the dedication of the proceeds of "any state tax or license."  The earnings of the Permanent Fund, from which the PFD is paid, are neither the proceeds from a "tax" or "license".  Instead, they are the earnings derived from investments made by the Permanent Fund.

Moreover, the distribution of the earnings (i.e., "proceeds") are governed by the statutes enacted pursuant to "section 15 of this article," which establishes the Permanent Fund.  It is not uncommon in other contexts that the results of actions that are undertaken pursuant to a law (e.g,, a constitutional provision or statute) sometimes are considered as "provided" by that law.

If Art. 9, Section 7 doesn't apply, then there is no bar to the legislature and Governor dedicating funds for a specific purpose.  This they did in 1982 when the legislature passed and the Governor signed the law creating AS 37.13.145(b).  By using the world "shall," the law itself is very clear that is directing that a specific action be taken, providing as follows:
At the end of each fiscal year, the corporation shall transfer from the earnings reserve account to the dividend fund established under AS 43.23.045, 50 percent of the income available for distribution under AS 37.13.140.
In its ultimate decision upholding the Governor's veto the Supreme Court did an end run around these arguments by finding that, despite its wording, Art. 9, Sec. 7 isn't really limited to just the proceeds of any state tax or license.  While the Court conceded that "a plain reading of 'state tax or license' might have suggested otherwise," they nevertheless concluded that the phrase actually captures "all state revenue," regardless of source.  Wielechowski v. State of Alaskahttps://goo.gl/5UqirP at *5.

There is some irony in the finding because, in the section of the opinion immediately above that the Court notes that its "analysis of a constitutional provision begins with, and remains grounded in, the words of the provision itself. We are not vested with the authority to add missing terms or hypothesize differently worded provisions ... to reach a particular result.”

But the Court effectively concluded that the anti-dedication clause is an exception to that rule. Despite the fact that "a plain reading of 'state tax or license' might have suggested otherwise," based on the history surrounding the creation of that provision the Court concluded that the anti-dedication provision is all inclusive.  The Court also found that, despite the fact that the proceeds at issue were being directed (i.e., dedicated) by statutes enacted pursuant to "section 15 of this article," the proceeds didn't fall within the exception created by that clause.

To be fair the Supreme Court has long held, reaching back to 1982, that the anti-dedication clause is to be broadly read.  But court's often narrow their broad statements in the context of specific cases and the Court never previously had been called on specifically to rule on its applicability to the Permanent Fund earnings stream or on the "section 15" exception.  Because it hadn't there was no precedent deciding the issue and Senator Wielechowski was well grounded in making the argument that the Permanent Fund earnings and the statute directing their use enacted pursuant to "section 15" were exceptions.

As a result, what really is going on here is, rather than a column rightfully calling out Senator Wielechowski for political pandering, Must Read's column itself is the political panderer, in this case to those who otherwise are looking for reasons to attack Wielechowski politically.

In short, instead of, as the column asserts, "Wielechowski’s suit was just a play for the poor and the stupid," it's the column itself that is doing so.  The lawsuit was well based; if anything its Must Read Alaska that is the "scammer preying on the 'aginners,' the poor and the stupid" who are "against" Senator Wielechowski for political reasons and want desperately to believe that he not only was wrong, but maliciously so.

But the fact is, he wasn't.