Dunleavy vetoes commercial fishing bill by Juneau senator that passed Legislature 59-1

Lawmakers can attempt override vote during August special session on bill that would provide loans to fishers

Boats in Douglas Harbor on June 15, 2025. (Mark Sabbatini / Juneau Independent)

A bill by a Juneau legislator that transfers about $3.7 million from a defunct state loan fund to a state-owned cooperative that provides loans to commercial fishers has been vetoed by Gov. Mike Dunleavy after it passed the Legislature by a combined 59-1 vote.

SB 156 by Sen. Jesse Kiehl, a Democrat, sought to make low-interest loans approved for small fishing operations also available for "potentially larger loans to Alaska fishing families," according to a sponsor statement. Both types of low-interest loans were approved by legislators as a temporary measure for the state’s commercial fishing industry which is suffering a crisis due to low prices, cancelled harvests and other factors.

Dunleavy, in his veto message last Thursday, stated Alaska is suffering a broader economic crisis due to lower-than-expected revenue, which other state officials attribute largely to a sharp drop in oil prices caused largely by economic uncertainty stemming from Trump administration policies.

"In a year of limited revenues and competing needs, committing scarce public dollars to subsidize a private lender is not prudent," Dunleavy vote. "Until long-term fiscal policy is put into place, the state must preserve its limited resources.”

Kiehl, in a series of social media messages, stated "that’s a weird move."

"First because it built on work I helped him do last year," Kiehl wrote. "I was glad to help Alaskans, and even though my name was on that policy I took pains to share credit with the governor. It’s also weird because this new bill passed the legislature 59-1. It just made good sense, and would have headed off some really big problems.

"But the weirdest thing is, he wouldn’t even talk with me about it. When we sent him the bill (on a schedule his team set,) I asked to meet so we could talk about the good it did for Alaskans and the bad consequences it headed off. He said no. Strange way to run a state."

The Legislature in 2024, at the recommendation of state investment officials, authorized the Commercial Fishing Revolving Loan Fund to provide loans to fishers "at a much-reduced interest rate of

5.25 percent," according to Kiehl’s sponsor statement.

However, that caused "significant harm to the finances of the Alaska Commercial Fishing and Agriculture Bank" — which is able to provide larger loans, according to Kiehl. SB 156 provided $3.7 million from "a now-defunct revolving loan fund" to allow loans at the same interest rate.

"The money will only be usable to let CFAB issue comparable low-interest rate loans until the revolving loan fund’s rates return to normal," Kiehl wrote. "At the end of that time, CFAB will need to return any un-lent state funds. It will have to repay the rest in 20 years."

The Legislature will have an opportunity to override the veto during the first five days of a special session ordered by Dunleavy scheduled to begin Aug. 2. An override vote on increased education funding vetoed by Dunleavy is expected to be the most prominent issue, with the governor asking Repubicans not to show up during those five days in an effort to thwart the override attempt.

• Contact Mark Sabbatini at editor@juneauindependent.com or (907) 957-2306.