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Saturday, October 20, 2018
HomePolitics and PolicySenate Finance: $1,600 dividend, education forward funding

Senate Finance: $1,600 dividend, education forward funding

BIG DAY, LOTS OF ACTIVITY IN SENATE
The Senate Finance Committee today moved forward on a $1,600 Permanent Fund dividend for eligible Alaskans this year, and also produced a plan to fund education for two fiscal years. But there are sideboards to the package.

HB 287  started out as an education early funding bill in the House, but when it arrived in the Senate, it had no funding mechanism. The House majority could not get enough votes to break into the Constitutional Budget Reserve to provide the funding, but it passed the legislation anyway and Democrats declared victory.

The Senate Finance Committee’s substitute language appeared to be an olive branch to the fragile Democrat-run House, which had a rough several days. Last week it voted to fund a $2,700 dividend, and then saw the Democratic majority caucus collapse into chaos over the decision.

That led to a do-over and passage of a $1,600 dividend by a narrow margin. Democrats and Republicans crossed caucus lines to vote both for the full dividend and for the compromise.

Hawkins

$1,600 is about $400 more than what was proposed by Gov Bill Walker, but the customary formula for calculating the dividend would have resulted in the $2,700 amount.

THE $5 BILLION DRAW FROM SAVINGS

By taking $5 billion from the Permanent Fund Earnings Reserve Account (the spendable portion of the $64 billion Permanent Fund), the Senate Finance Committee proposes guaranteeing schools two years of funding. $1.25 billion would be the education and pupil transportation budget for the fiscal year starting in June.

“Early funding for education will give Alaska’s education community the certainty it needs,” said Anna MacKinnon (R-Eagle River), co-chair of the Senate Finance Committee. “The Senate wants to end the gridlock and avoid a situation where districts are forced to send out pink slip notices to teachers because they don’t know the funding level from the state.”

“We can take positive, meaningful action this year to move our state forward—like forward-funding education—if we stabilize Alaska’s revenue,” said Sen. Lyman Hoffman (D-Bethel), co-chair of the Senate Finance Committee. “A responsible draw from the Permanent Fund’s earnings, committing a percentage to government and a percentage to ensure dividends, provides the stabilization we’re looking for.”

The draft plan has a contingency for funding the 2020 education budget. It would require passage of SB 26 — the restructuring of the Permanent Fund to create a “structured draw,” that would be sustainable into the future. That legislation, which originated in the Governor’s Office, has been through several iterations and has passed both the House and Senate, but has not left Conference Committee.

Now, at least the Permanent Fund dividend is not an item that could be leveraged during Conference, since the House and Senate numbers agree.

 

 

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Suzanne Downing had careers in business and journalism before serving as the Director of Faith and Community-based Initiatives for Florida Gov. Jeb Bush and returning to Alaska to serve as speechwriter for Gov. Sean Parnell. Born on the Oregon coast, she moved to Alaska in 1969.

Latest comments

  • So by my calculations the Legislature will raid the PFER and CBR for $3.4 billion and that doesn’t count the second year of funding for schools.

    • So adding the second year school funding to the draw from the PFER gets you to $4.7 billion from the Permanent Fund this year – reducing total PF value from $65 billion to $60 billion.

      • Comrade Chris the PF and the PFER are not together the same and will never be,,, get real!

  • Does this mean everyone that’s eligible for the PFD will have access to libraries, pools and gym property in the State Schools, it looks like we’re contributing enough for a free pass.

  • Isn’t it funny how no amount of money will improve the government K12 education system? The R senators are being held captive by the state Education Industry. Too bad for the kids. Guess we’ll have to build larger prisons.

    • With the declining population, we can turn the schools into prisons. Oh wait. That’s what they are already.

  • But it’s for the children. Universal excuse for horrible political posturing.

  • Putting the putting the public educational on the backs of every child in Alaska who qualifies for a State Dividend is nothing more than a robbery of our children’s futures and a complete cop out by the Adult population of State to properly support Public Education!