When the clock strikes midnight, one of the first thing many Alaskans do is have a glass of champagne — and then file for their share of the oil wealth in Alaska — their Alaska Permanent Fund dividend.
The link the PFD application is here. Or go to your MyAlaska.gov page, if you have an existing account with the State. The dividend is generally issued each October for qualified applications, which must be received by the Alaska Permanent Fund Division no later than March 31, 2022.
The Permanent Fund dividend was created by statute in 1980, as a way to share the royalties of the oil with Alaskans, none of whom has the ability to own subsurface rights. After a court delay regarding the residency formula for the dividend, the first dividend was issued on June 14, 1982 to all Alaskans who had been residents for six months or more. Later, by statute, the residency was changed to one year.
The statutory formula for the fund worked for decades until in 2017, when former Gov. Bill Walker vetoed half of the people’s PFD, preserving it in the Earnings Reserve Account of the Permanent Fund. He said the money was needed to pay for government but, in fact, it was not spent on government. It was simply retained in the fund. He issued a dividend that year, using political calculations rather than statutory calculations, and Alaskans got $1,000, half of the 2015 payout.
To understand the loss of value of that $1,000 through time and inflation, Alaskans would need to receive about $2,881 in their dividends today to equal what that $1,000 was to them in 1982.
Every year since the Walker half-dividend, the Alaska Legislature has followed his path, taking over half of the people’s money for government or to just leave in the Earnings Reserve Account, which currently has more than $15.7 billion, with $8.9 billion of it uncommitted. The fund itself has over $83 billion in it.
In 2017, the Legislature and Gov. Walker also passed Senate Bill 26, and created a new way to draw down funds from the ERA to pay for state government. The Legislature has never fixed the remaining problem, which is that the previous statutory formula is a state law that the Legislature has broken every year since Walker’s fateful move to take the funds from Alaskans’ wallets as what is arguably the most regressive tax in America.
Gov. Mike Dunleavy has tried to restore the full statutory dividend to Alaskans but has run into headwinds with the Alaska Legislature every year of his governorship. Again in 2022, he will attempt to restore the other half of this year’s dividend to Alaskans, through a supplemental budget request he will make to the Legislature.
What are your thoughts on the Alaska Permanent Fund dividend? Leave them in the comment section below.