Parnell may test legality of capital budget language VETO: All-or-nothing clause usurps governor's veto power, he says; Senate holds firm.

JUNEAU -- Gov. Sean Parnell is not ruling out the possibility of lawsuits being filed against him as he plans to test the bounds of contingency language the Senate is looking at including in the capital budget.
The Senate Finance Committee's proposed capital budget includes language making $400 million in energy projects an as-is, all-or-nothing deal. A non-severability clause states that if the language is found to be invalid, essentially the package is, too.
Parnell told the Capital City Republicans Monday that he hasn't vetted or reviewed many of the projects yet; he said the Senate hasn't either, but it still wants to hold him to the projects and take away his line item veto authority.
Parnell said he won't stand for it.
If the Senate persists in keeping the language -- and leaders of the Senate's bipartisan majority have shown no signs of backing down -- Parnell said he would either have to waive his constitutional veto authority or test the bounds of the language. Given that choice, he said, he'd pick the latter.
"I think we tend to make this too much about personalities and less about the constitution that we're governed by," he said. "For me, it's about the constitution that we're governed by."
A governor should not "willingly give up constitutional authority," he said, adding that if the language stays, he'd be "forced to look for projects to veto" to protect the balance of powers.
That could lead to lawsuits from lawmakers or third parties. Parnell said a veto of any one project within the package would cast a cloud over the rest. He said a group that opposes hydroelectric projects -- like the massive Susitna dam proposal the state is pursuing -- could sue on environmental grounds or on the basis the appropriation was invalid in the first place.
The language "sets up an untenable situation where other projects are threatened with litigation that doesn't need to be there," he said in an interview.
Senate President Gary Stevens said leaders of the Senate's bipartisan majority realize the matter could end up in court. But, "we think we're on solid ground," he said, adding that if the governor believes he needs to test that, so be it.
The Senate Finance Committee has refused to advance its capital budget bill without agreement from the House on its size and structure. House GOP leaders have deemed the language inappropriate and refused to sign off.
The impasse led to the current special session, which began April 18. Over the last week, there's been little to no progress toward a breakthrough.
Senate leaders trace the predicament to Parnell saying he'd let the Legislature spend $2.8 billion on the capital budget if it also passed a bill addressing oil taxes. If that bill stalled, he said he'd have to rein in capital spending even more. (Parnell proposed cutting taxes as a way to boost investment and development. The state relies heavily on oil revenue to run, and oil production is declining.)
The House narrowly passed a version of the tax bill but it stalled in the Senate. That prompted fears that Senate projects in the capital budget could be on the chopping block.
Contingency language included in the latest version of the capital budget states that the energy projects come as a package and that each of the appropriations depends upon approval of every project -- without reduction in size.
Sen. Hollis French, an attorney who's been researching the language issue and plans to address it on the Senate floor, likens the contingency and non-severability clause to a "mousetrap" built in case the Senate wouldn't be able to get the votes for a veto override. French said that with the current language the governor still retains veto authority; he'd just be vetoing a "much bigger chunk."
He said he's not sure what a court would decide but believes the Senate stands a good chance of winning.
"There are eight different ways to do this," French said. "This is just one."
He said the governor would make the process easier if he'd sit down and talk with lawmakers.
Parnell said he has spoken with leadership and never threatened to target certain senators. Rather, he characterized his statement as being in line with his position last year, when he said he'd have to make cuts if legislators did not honor a spending limit. He said he has promised legislators that he won't abuse his veto authority. He said he will use it to rein in spending and as part of a checks-and-balances system. In turn, he said he has asked lawmakers not to abuse their appropriation authority.