Bill to make PFD statutory formula constitutionally protected is in House Judiciary on Friday

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A bill offered by House Ways and Means Chair Rep. Ben Carpenter of North Kenai, requiring the state to pay an annual Permanent Fund dividend based on a statutory formula — not based on each year’s legislative whim — was discussed and analyzed in the House Judiciary Committee on Wednesday. It will be the topic of public testimony on Friday.

Carpenter, speaking to the committee to advocate for HJR 7, said that for almost 30 years Alaskans could count on their annual dividend checks to come as the state legislature followed the law that created the statutory formula.

In 2016, Gov. Bill Walker broke trust with the people of Alaska when he vetoed a large portion of the dividend. Subsequent to his veto, a court case was filed and the Alaska Supreme Court decided that the dividend was merely an appropriation like any other.

That set up a contradiction, since there is an existing statute that provides a formula for how the dividend, which represents a portion of the wealth that originally came from Alaska oil royalties, will be arrived at each year.

Although the Legislature could have chosen to return to the statutory dividend calculation, each year since Walker halved the dividend, the Legislature has been caught up in ongoing battles over how much it will give to the people, and how much it will give to government.

In essence, what used to be an amount that was calculated and not fought over is now a yearly battle.

The bill would not set the amount in stone in the Alaska Constitution. It would only require the Legislature to follow statute. That’s because the Alaska Supreme Court said the payment was statutorily defined and the Legislature can change the statute and change the formula, but must then stick to the formula.

Neglecting to constitutionalize the PFD would allow lawmakers the ability to shirk their obligation to address the shortcomings of Alaska’s fiscal and economic planning, he said. That has how it’s been done for the past eight years, since Gov. Walker made the decision to veto half of Alaskans’ counted-on dividend.

Being sensitive to the occasional vagaries of the investment portfolio of the Alaska Permanent Fund or inflationary pressures, HJR 7 would not allow the Legislature to ever dip into the corpus of the fund. That is protected by the Alaska Constitution.

Amendments to the bill from committee members were due at 5 pm Thursday. Public testimony will be taken on HJR 7 when the committee meets again on Friday at 1 pm.

Wednesday’s committee discussion can be watched at this link.

34 COMMENTS

  1. This bill is DOA. We ain’t getting full dividends back, the government can’t afford the government it built much less maintain current spending and give Alaskans their rightful share.

  2. Im a little confused my interpretation is that the Legislature cannot decide what the people will receive it will come from the PFD STATUTE. Is this correct? So no more stealing our money?

  3. Not holding my breath but my hat is off to this effort @tired of the money grubbing control freaks playing with what is right and making it wrong every time !

  4. This right here summarizes why the Alaska Supreme Court was WRONG in its ruling:

    “In 2016, Gov. Bill Walker broke trust with the people of Alaska when he vetoed a large portion of the dividend. Subsequent to his veto, a court case was filed and the Alaska Supreme Court decided that the dividend was merely an appropriation like any other.

    That set up a contradiction, since there is an existing statute that provides a formula for how the dividend, which represents a portion of the wealth that originally came from Alaska oil royalties, will be arrived at each year.”

  5. The real battle is retaining the PFD at all. They won’t stop until they get it. Then they’ll go after the corpus. Government must be fed, not matter the cost.

  6. Sounds like this would put whatever formula they come up with in statute and that would be the rule constitutionally. The statute might change from the current old formula but whatever they come up with would be it. No more legislative appropriation. Ben is trying to settle this once and for all. Not easy

    • I agree and would add: today, the amount of PFD check is a negotiated value in the Budget Conference Committee. This committee is made up of 6 legislators appointed by the House Speaker and Senate President. This proposal would put each legislator on record by their vote on the Statute (which could be changed annually)

  7. While they are at it, they need to decide how they are going to return the illegally taxed PFD to each man, woman and child. Since 2016? Maybe the teachers won’t recieve as much, or start with forfeiting their federal rate per diem each one accepts.

  8. Derrrr. a statute that orders an annual appropriation is meaningless. As the very body that passed the statute can violate it at will. You cannot bind future legislatures to mandatory spending statutes from past legislatures.
    Unless you pass a constitutional amendment (2/3 legislature 50% popular vote?). That would be the people voting themselves a raise while destroying their civilization.

    • “…….That would be the people voting themselves a raise while destroying their civilization.”
      They’ll do it in a heartbeat.

  9. Dave If Ben had any back bone he would stand on the principal that following the law doesn’t require another law or Constitutional Amendment ! Go Figure ! A Conman with a full on in your face shell game ! As I told the Governor before he was elected ask again in another advisory vote, then you have a “WE THE PEOPLE ” support & a Art. 1 Section 2 Mandate! “All political power is inherent in the people. All government originates with the people, is founded upon their will only, and is instituted solely for the good of the people as a whole. ” Elected Officials be damned.

  10. Being a resident in Alaska since 1967 how about this formula, so much for each year one resides in the state rather than an equal amount for the first year newbies who wind up leaving anyway……
    But that would never happen anyway as the legislators spend more time arguing and coming up with schemes to defraud the people of Alaska. How about at election time, ” and I’ll fight to make sure you get your dividend if elected” only to jump on the bandwagon of using it for other purposes.

    • If you have been here since 1967, you would know about how the Alaska Supreme Court ruled in 1982 that your proposal (the original PFD idea) is illegal as it violates the equal protection clause of the State of Alaska’s Constitution which is based on the equal protection clause in the US Constitution.

      I’ve only been a resident of Alaska since 1990, the year I was born, but I learned about this in public schools in Anchorage.

      You should look up Zobel v Williams for a great explanation as to why your proposal doesn’t fly

      • We didn’t have good schools back in 1967. The schools were funded by a flat School Tax. And that’s where we’re going again while the dependent class takes their PFD dividends to Hawaii or drink it up in the gutters.

  11. Ahhhh the J.W Wentworth Republicans again saying “It’s my money and I want it now.” Damm the consequences. Actually that’s the Republican Party in a nutshell, Delusional.

  12. “The bill would not set the amount in stone in the Alaska Constitution. It would only require the Legislature to follow statute.” The legislature is already following statute, the problem is they never got rid of the original statute and they are following the illegitimate statute. I guess I don’t see how this helps when they already disregard the statute language that was in place and legally has precedent over the newer statute that didn’t vacate the older statute.

  13. So if they can ignore a statute now, why would they be forced to follow a different one? Even if they follow it, a governor can veto it according to our illustrious Supreme Court. Full PFD is never coming back and will eventually go away. The largess of gubernment can never decrease.

  14. Regardless of outcome, the effort represents the will of the majority of Alaskans and must be addressed to continuously expose the coyotes. Watching gavel to gavel, it apparent that many legislators are suffering from vitamin D deficiency this session. They should move it to Hawaii and save money in the long run. Just as accessible and affordable but more desirable for us to sit in on a session.

  15. I don’t understand.

    democrats give benefits and policies that help people. people like their benefits but hate that the neighbors get similar services.

    republicans complain about democratic give aways, that they themselves benefit from, want to keep theirs, strip away other peoples

    billionaires don’t pay progressives taxes, used carried interest and pledged asset loans to themselves, skirting taxes but claim we get trickled down upon by them

    shouldn’t everyone be happy??

  16. Constitutionally mandate the dividend statute, and we will get an income or wealth tax almost immediately. In this way, “the poor” will continue to get drinking money, and the working class will pay for the services the dependent class will continue to demand.

  17. Carpenter not only wants a large dividend, he has proposed $3000. vouchers for each child that is homeschooling. Makes me wish I wasn’t 70, under his plan I could live pretty well if I could have about 6 more children!

    • I was incorrect on my previous post. He actually wants to give in excess of $7,000. per homeschooled student directly to the parents. EUREKA!! Under his plan ,a family of 6 would receive something in the neighborhood of $50,000. per year in direct payments from the state just for living in Alaska and homeschooling their 4 children.
      Unearned income at that, so we may still qualify for other benefits. Ain’t it grand!

      • That would be a bargain, since the average student in Alaska costs over $18,000. Maybe math works differently in your world, but is $18,000 more or less than $7,000? In my world $18,000 is more than $7,000. I’ve known some homeschooled people and while some might be a little weird, they are usually able to do simple math problems like $18,000 is greater than $7,000.

      • In your hypothetical scenario wherein 4 children are homeschooled and the parents are paid in excess of $7,000…how exactly do you get to $50,000? I guess that $12,500 is in excess of $7,000 but it seems like math isn’t your strong suit. Did you count the parents in your hypothetical math equation, by chance?

        Seems like we need more homeschooling at less than half the price if this^ is the product we receive.

  18. The most important measures that the legislature could do for the benefit of Alaskas are:
    1) Legislative sessions held in Anchorage and 2) eliminate the PFD.

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