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Administration assesses possible shutdown Gov. Walker sets up incident command structure in event Legislature fails to pass budget; resource agencies face different impacts Kristen Nelson Petroleum News
The Walker-Mallott administration has established an incident command structure to prepare for the impact on the state of a failure by the Legislature to pass a budget by the end of June.
Walker said in a June 8 statement that he was hopeful legislators would reach agreement on a budget, but, “my team and I must be prepared for a worst-case scenario.”
“A shutdown would put the State in a constitutional crisis,” Attorney General Jahna Lindemuth said in a statement. The constitution clearly puts the power to determine where to spend money in the hands of the Legislature, she said, and if a budget is not passed, “many state services will have to be fully shutdown in order for us to remain in compliance with the constitution.”
A Department of Law fact sheet said personnel and funding necessary to prevent immediate threats to public health or safety, such as operation of correctional facilities, state-operated nursing homes and medical facilities, law enforcement, and emergency and disaster response would be areas where government programs and services could legally continue at partial or complete funding levels. A second tier could be programs and services which may only be delayed a short time before severe impacts would occur, such as federal public assistance programs, unemployment benefits and timely payments of bonded indebtedness.
The department said a third tier would be constitutional or federal mandates that may not require 24-hour or even weekly operations but could become urgent if a shutdown were to continue for too long.
Resource impacts In the Department of Natural Resources, wildland firefighting operations and operation of the Alaska Volcano Observatory would likely continue.
“DNR is looking at the possibility that virtually all other DNR programs and activities involving state land, water, forestry, agriculture, geological and natural hazard research, oil and gas leases, pipeline right-of-way oversight, and state parks, could be suspended or experience significant interruptions,” the department said.
Permit and authorization issuance top the list of potential impacts to DNR, which would impact oil and gas project work.
The Department of Environmental Conservation said it “anticipates a limited number of services would continue at some level during a shutdown to meet constitutional obligation to protect life, health, and safety,” with the Division of Spill Prevention and Response maintaining the ability to respond to an oil or hazardous substance release, but other programs impacting public life, health and safety likely continuing at a reduced level, and services such as issuance of permits likely to be shut down.
Inspections an issue for AOGCC The Alaska Oil and Gas Conservation Commission is an independent state agency within the Department of Administration. In a letter to the governor, the president of the Senate and the speaker of the House, AOGCC’s three commissioners said that while cessation of permitting would be the most immediate negative impact, soon after July 1 the agency “would be confronted with far more difficult questions, such as how long to allow continued production from production wells that have not had their safety valve tests witnessed by our inspectors, how long to allow injection into the approximately 250 enhanced recovery injection wells under increased monitoring for known mechanical integrity concerns, and whether existing permits for drilling rigs whose blowout preventers are no longer being inspected should be revoked.”
While AOGCC permitting would be impacted, the more significant impact of a shutdown on the state if inspectors are laid off could be production, both North Slope crude oil and crude oil and natural gas in Cook Inlet.
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