A: Well, our top thing to do is to improve the education system in Alaska. So education and better schools are the top priority for Democratic legislators. And that's everything from early childhood, after-school programs, K-12 and the university. And we're really excited that the governor has come around to our side, funding the regents' request for the university. And we respectfully ask him to follow through and twist arms of the Republican legislators to make sure that the university gets the kind of budget that they need to move the state forward. Education is our top priority along with economic development and getting the state's fiscal house in order. We're anxious to hear what the governor's proposal will be to do so.

Q: Do you think the Legislature will produce a long-term fiscal plan this year that includes a broad-based tax such as an income or sales tax.

Veteran Democrat: Senate Minority Leader Johnny Ellis, an Anchorage Democrat, discusses an issue on the Senate floor during the 2002 session. Ellis has been a senator since 1993 and was in the House of Representatives for six years starting in 1987. BRIAN WALLACE/ THE JUNEAU EMPIRE

A: I'm hopeful that we will be able to discuss a comprehensive fiscal plan. I'm not optimistic because, you know, the governor made a lot of promises and ran on getting the state's fiscal house in order and then came into office, broke his promises, created a lot of buyer's remorse on the part of the public, I think, who supported him. You could say that the first year he was sort of trying to get organized and get his administration in order. The second year there's no excuse if there's a lack of leadership from the governor. I would hope that he will show leadership and engage the Legislature in a bipartisan discussion for a fiscal plan for the state that makes sense and will actually avoid a manmade crash in the economy and in the state services in the future.

Q: In November many lawmakers will be running for re-election. Will this keep them from passing new taxes this year?

A: I think the Republican legislators are very loath to upset their base voters, so I believe they are very loath to tamper with the permanent fund, to decrease the dividend, to raise significant revenues. I think they are looking for the governor, even more than the Democrats, the Republicans are looking for the governor to take leadership on those things, and to say that they had to go along with the governor or he twisted their arm or whatever, they're looking for an excuse. ...

There's a bit of trade-off going on between the Republican legislators and the governor of who's going to take the leadership, who's going to take the heat for the things that everyone with any insight or intelligence and any experience realize must be done in the near-term to avoid a crash.

Q: Democrats rejected taxes last year proposed by majority lawmakers largely because the proposals were not part of a comprehensive fiscal plan. Do you anticipate Senate Democrats supporting some piecemeal taxes this session?

A: Our minds are open. We do want to see a comprehensive fiscal plan. That doesn't mean that we wouldn't consider the pieces thereof. It seems like in a very predictable fashion Republicans call these things user fees and they promised their voters that they wouldn't raise taxes and it's kind of interesting to watch them squirm and the rhetorical acrobatics that go into them explaining some of the tax increases that they voted for. We believe in honesty in budgeting and honesty in advertising, that an increase in fee is essentially a tax on the public. ... It seems like Republicans, when they talk about taxes, go after average working Alaskans, low-income folks and protect their contributors and their voters.

We think that any kind of fiscal plan needs to be measured and reasonable and fairly distributed across the population. That's why something that's broad-based has more appeal for us than targeted taxes ...

Q: Do you believe there is support in your caucus for adopting the Percent of Market Value endowment plan for the Alaska Permanent Fund and using some of the earnings, which are used to pay dividends, for state government?

A: ... I think we are anxious to get together as a group and compare notes and discuss that and do so in an open kind of forum. We're hoping that there will be public hearings and open caucuses and we can discuss the percent of market value approach. Like I said, we have an open mind about these proposals. But for us, the permanent fund is not the first option. You know, our sense is that Republicans don't want to vote on any revenues, new taxes in an election year. That would upset their conservative supporters. They would rather go after the permanent fund dividend, which, as Jay Hammond has described, would be the most regressive tax increase and tax on future Alaskans.

Using the permanent fund solely for getting out of the fiscal mess is probably a non-starter for Democrats. We don't believe taxes should be the first option. We don't believe the permanent fund should be the first option. We believe that a comprehensive approach that has bipartisan public support would be the way to go. We need to lock arms and move forward together. We're not saying that an incremental approach doesn't have some merit. But the Republicans going after the permanent fund first, if that's what they intend to do, I think, will meet with a lot of resistance.

Q: Does your caucus plan to continue to push the plan to enshrine the dividend in the Constitution this year?

A: (Last year) we all wore yellow buttons that read "PFD: Permanent Fund Democrats." And that was our message to the majority and to the public that we would not allow a raid on the permanent fund or taking away the dividend without a healthy debate. And once we got the definitive decision that enshrining the permanent fund dividend in the Constitution would not trigger a reaction against the permanent fund by the IRS, we thought the proposal had even more merit. So as we're discussing the Percent of Market Value approach that some favor we should discuss what the future of the permanent fund dividend should be. ...

Q: Last session a lot of Democrats opposed the idea of expanding gambling in the state. Will your caucus reject new gambling proposals this session?

A: We are not together in some sort of caucus position on the issue of gambling, but the feelings run very deep among our members. And most of our members believe that gambling in the state of Alaska would be a very negative development. I think that people see a lottery or participation in the multi-state Powerball thing as less destructive. But for the most part an expansion of gambling, especially with the video poker in bars, making mini casinos, most people in our caucus think that that is probably not the best way to go and wouldn't be a big factor in closing the fiscal gap and that the social consequences and impacts on public services would outweigh the revenues. ...

Q: In Gov. Frank Murkowski's budget there are new taxes on cruise ship passengers, gambling, smoking, hotel lodging and guided tours. Will Democrats support any of these proposals?

A: ... I'm willing to consider all of those. I don't believe that a Republican Legislature is very anxious to pass any of those taxes. They, I don't believe, want to be tagged by any of their supporters as pro-tax. The interesting thing will be to see if Frank Murkowski and Jim Clark twist arms and use their executive power to get their friends in the Legislature, their political supporters, to get those revenue measures. ... But I don't give any of those tax increases very positive chances.

Q: The retirement benefits for the Public Employees' Retirement System and the Teachers' Retirement System are underfunded by $4.2 billion. What is the Legislature doing this session to deal with that?

A: I think there will be some discussion of it. I don't know that there will be a ... You know, that's something that I think legislators will be happy to put off until the next year. I think the municipalities are still reeling from Murkowski's decimation or ending of municipal revenue sharing for all intents and purposes, and now the new Murkowski proposal to make local governments pay a percentage of what the state and federal government have always paid in the past for road projects.

... I'm hoping that there will be some sort of discussion and consensus building this year for the next session to try to see to what extent that's a drag on things, so that we can come up with some kind of incremental intelligent long-term approach to solving that problem. ...