Putting the Permanent Fund dividend into the Alaska Constitution would end the yearly legislative battle over Alaskans’ share of oil royalties. It’s been a tough fight every year, causing deep divisions in the Legislature over competing visions for Alaska’s future.
But now, a broad group of lawmakers and the governor have a path forward.
Committee Substitute to Senate Joint Resolution 6 is a solution that will be introduced in Senate Judiciary today. It has support from a group that includes many Republican senators, and Democrat Sen. Lyman Hoffman. In the House, Rep. Louise Stutes supports the plan, along with many of the Republican representatives.
Dunleavy proposed a few revisions to strengthen the Permanent Fund constitutional amendment (SJR 6) that builds a sustainable fiscal future for all Alaskans and guarantees an annual dividend to all Alaskans now and in the future.
If passed by the Alaska Legislature, Alaskans will be able to vote on the most significant policy decision since the establishment of the Permanent Fund. The constitutional amendment would be on the Nov. 2022 general election ballot.
- Guarantees a PFD for every eligible Alaskan now and for future generations
- Creates a fair and sustainable 50/50 split of Permanent Fund earnings between PFDs and core state services
- Shields the $1 billion power cost equalization endowment from politicians by depositing it in the fund’s corpus
- Protects future state budgets from significant deficits by transferring $3 billion from the Permanent Fund Earning Reserve Account to the Constitutional Budget Reserve
“My administration has put forth three constitutional amendments that aim to create an economically healthy future for Alaskans by removing the politicized uncertainty they face year after year. SJR 6, with a vote of the people, will protect the permanent fund well into the future,” said Dunleavy.
“A number of legislators are supportive of this concept and we are positive the passage of SJR 6 will resolve the long standing dispute over the permanent fund and the PFD, and further protect the power cost equalization endowment within the permanent fund itself. A resolution to these long-standing issues will undoubtedly go a long way to putting Alaska on a strong fiscal foundation,” he said. Key to passage will be provisions that also protect the Power Cost Equalization fund, which helps rural Alaskans with their power bills, since they do not benefit from the major power projects that serve the Railbelt.
After years of spending down savings, state government is approaching a situation where the Permanent Fund Earnings Reserve is exposed to spending by means of a simple majority vote, Dunleavy said.
The governor’s proposal will establish protections to prevent ad hoc spending from the Permanent Fund, allowing for continued growth.
The amended legislation will be introduced in today’s Senate Judiciary Committee meeting.
Sen. Shelley Hughes said that once this piece of the puzzle is figured out, the state will then have to tackle revenues and a sustainable budget going forward. But this measure will give the Legislature time to do so over the next few years. Meanwhile, lawmakers will no longer spend months haggling over the size of the dividend.
Fourteen votes in the Senate and 27 votes in the House are needed to move the legislation through.