Holding out for $3,000 PFD is no way forward - Must Read Alaska
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Tuesday, August 20, 2019
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Holding out for $3,000 PFD is no way forward

ADVICE FOR THE GOVERNOR FROM A PFD DEFENDER

By JOE GELDHOF

Alaskans have achieved noteworthy accomplishments over the years.  Among these are the adoption of a stellar constitution and the establishment of the Permanent Fund.

We Alaskans also decided to link the public funds placed in trust as part of the Permanent Fund with the citizen owners of the fund by paying an annual Permanent Fund dividend to every eligible Alaskan.

The Permanent Fund Dividend is one of Alaska’s best ideas.  Payment of the annual dividend from the earnings of our public savings knits together our diverse state.

The dividend is the one way we treat every Alaskan equally.  And why shouldn’t we all be treated equally?  The savings that generate the dividend payment belong to all of us.

Unfortunately, the funds that flow from our Permanent Fund that are used to fund the annual dividend are being held hostage by interests with varied agendas.

The link the dividend forges between each and every Alaskan and their Permanent Fund is being sacrificed to accommodate government spending and other agendas advanced by factions inside and outside of Alaska.

In this contentious atmosphere, Gov. Michael Dunleavy’s steadfast support of the PFD is admirable.  The governor’s resolute stance that the PFD be based on the existing statutory formula was a worthy goal.  But this goal has collided with political reality.

In order to protect individual rights and prevent the accumulation of political power to the determent of every citizen, the Alaska Constitution separates authority for governmental action between different branches of government. The governor of Alaska can propose spending but ultimately the legislature disposes of spending via appropriations, after which the Governor can reduce spending but with no ability to increase funding.

Given the separation of powers that defines our constitution, Gov. Dunleavy has tirelessly advanced the idea that each eligible Alaskan should obtain a full PFD according to the existing statutory formula.

But payment of the PFD is conditioned on an appropriation each year.  This year, the Legislature balked at making the full statutory PFD payment and instead appropriated $1,600, an amount that is somewhat arbitrary but constitutional.

Gov. Dunleavy deserves a lot of credit that $1,600 was appropriated for the PFD.  Without Dunleavy’s relentless advocacy, the amount for the PFD certainly would have been smaller.

So, what happens next, now that the appropriation bill, including the $1,600 for the PFD, has been transmitted to the governor for review?

A rump group of citizens are demanding the governor veto the $1,600 PFD appropriation and hold out for the full statutory amount.  I for one think this is a misguided effort.

If the governor heeds the call to veto the funding for the PFD at the $1,600 level and hold out for a larger sum, the predictable outcome will be no PFD for anyone this year.  The harm to individuals and the Alaska economy that follow from having no PFD are obvious and catastrophic.

What the Governor ought to do, in the circumstance, is evaluate the spending measures recently transmitted to him by the legislature and make targeted cuts designed to increase the efficiency of our state government.  What he should not do is veto the PFD appropriation.

Instead, after the governor has completed his constitutional review of the spending measures and made his reductions or vetoes while leaving the partial PFD appropriation intact, he should call another special legislative session.

In the next special session, Gov. Dunleavy should work with the Legislature to top up the shortened PFD and also adopt a resolution that puts an acceptable constitutional amendment before the voters calling for a fair and equitable PFD distribution each year.  Then and only then will the citizens of Alaska and our elected and appointed officials have the certainty to build a sustainable annual budget and get on with advancing the interests of this wonderful state.

We Alaskans need certainty and predictability when it comes to the PFD.

Alaska has an excellent constitution.  And we were wise to amend the constitution to allow for the Permanent Fund.

Now the time has come for the governor and the legislature to work cooperatively on behalf of the Alaska citizens to put the manner in which the PFD is paid in the Alaska Constitution.

Working together, payment of the full PFD this year is possible along with settling on a constitutional amendment that will be voted on by the people next year.

Joe Geldhof is an attorney who lives in Juneau. Geldhof is a Board Member of the Permanent Fund Defenders. The views expressed in this column represent his personal opinion.

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  • If the Governor does not hold stead fast to the failings of the Legislature to move forward with the statutory formula he might as well resign and go home because these bullies in the Legislature will continue to push for spending that the state can not afford. The time is now for the Legislatures to be called on their bluff. If it means no dividend this year it will give him ample time to use the bully pulpit to chastise the Legislatures that do not have anything but special interst groups and their next election. Hold fast and make these Legislatures answer to the constituents why they did not get the full dividend.

    • I’m thinking you’ve put your finger on it Steve. This Governor will resign, rather than wait for his Recall. He’s already done it once with his Senate position and it goes with the territory IMO.
      He is toast now by showing he has caused nothing but chaos with his budget cuts that he now says were just to find out that Alaskans like their seniors and children. His bully pulpit is non-existent after his showing, so far, and he cannot chastise this Legislature that has painted him into his own corner IMO. Further, he has almost no constituents anymore (also IMO).

      • The terms of every legislator that is in opposition to the governor must be ended. They are the very same ones that run this state in the ground. Election time is coming and these names will be remembered.

        • Good luck with that, NAV.

    • If you or your family was not here to get the first dividends no one should be making comments about our dividend!!!! You shouldn’t get one if you were here for the first one !!!

      • Boy the stupid is strong today!

    • The State can’t afford all the people who live here and use services they don’t pay for.

  • Being one of the “Rump Group Of Citizens” here is how I read the rubbish you wrote Joe, basically what your saying is: After the SOA government bloated spending to a level that could not be afforded and have found a way to take the money from the people of this great State, that we traded our Mineral Rights for. We are supposed to be thankful that they only want to take half this year so they can keep the bloated budget??? Even though we had a deal to equally distribute the wealth from our Mineral Rights to all Alaskans. Oh….and without a vote of the people BTW. Dunleavy should VETO the $1600 & place it at the foot of the legislators. Everyone knows who’s fault this is. The only people that think taking it from the people are those few that benefit from it……no surprise the Unions & UAF/UAA are crying the loudest. Put it to a Vote of the People & you will realize that your “Rump Group” is the MAJORITY of the state. You don’t hear our voice in the ADN…..you hear it at the Ballot Box.

    • @Blackcat, I agree with you. We all know that the Governor should take the blame, as he was unwilling to discuss with the Legislature. The budget may be bloated, but it’s the Governor’s fault once again, as he refuse consistently the idea of taxes.

      • Marc if that’s what you got out of my post you need to read it again.

    • BLACKCAT: I believe you are correct that a majority of Alaskans support payment of a full statutory PFD. I certainly do, as well.
      But the will of the majority in this point didn’t translate into the appropriation you, I and others sought. Why is that, do you think?
      So here we are with the appropriation the legislature passed. Does it really make sense to demand that the Governor zero out the appropriation that will result in a payment of $1,600 for eligible Alaskans and run the risk of no PFD?
      I’m not sure a majority of Alaskans support the veto you seek.
      What I am confident about is that a majority of Alaskans want to vote on a constitutional amendment that will protect the PFD forever.
      How about if we work towards that?

      • Joe, Someone has to stand in front of this and say “Enough!” Sometimes thing’s are hard….. but it doesn’t mean they shouldn’t be done. A Veto is the only way he can put the pressure on the legislators. I see no other path for him and it is the only way that the people of Alaska will stop getting ripped off by a lazy House/Senate that just want to spend more. You really , REALLY think that if he caves now it will ever get better? Nope the Can will just be kicked down the road once again until there is nothing left but big Government.

      • Joe, you know full well why that didn’t happen (full statutory PFD). It ran afoul of the POMV amount passed the previous Legislature which only allowed for a certain amount to be transferred from ERA to GF for appropriation (PFDs and Govt. services).
        That said, with the money being in that ERA, we all know that a simple majority can get access to those funds (for any reason). My opinion is that it will take some serious horse trading to get at those funds from this Legislature. Maybe even some trades to get a fix on future PFDs put in Constitution, as it will be difficult in an election year (next session).
        I believe you are on the right path to getting this $1600 rather than a veto as this Legislature could very well come back with $900 in the special session that would be required .

        • Mr. Yankee: The current statutory provision addressing the POMV draw is aspirational from a legal, just like the statutory PFD distribution formula.
          In the end, what we need more than anything else is a resolution that will allow the voters of Alaska to embed a PFD distribution formual in the Alaska Constitution so we can resolve this annual appropriation fight. Along the way to getting the resolution, we may well get the appropriation to top up this years PFD. But only if we work in concert and not act like one side must win and other other side oblieterated.

          • Except the one-side that is insisting on something (full statutory PFD) is the problem IMO. I don’t see a working in concert for a full PFD any more than a working in concert for something less. It is just politics and one side will win depending on who has the votes. That POMV is a recent law that many of this Legislature was involved in and they believe in it-the statutory PFD, not so much as nobody is around today that were involved in it’s passing. Sure we all like free money but some folks are more interested in other things. Just my opinion.

    • I too am one of the “rump group”. I was born in this state and I have seen bad times here. The PFD was never meant to be used the way the legislature wants it now. They were given “ their piece of the pie” already. Because they can’t make the hard choices where to cut spending, they would rather take a larger piece and push the budget down the road. If you cut spending jobs will be lost and people will leave the state, This happened before in the 80’ and yet we survived and this state has flourished since. The largest percentage of people living in this state are at or below poverty level. I have seen what a large PFD can do to help them. Make the hard decision and cut the budget before the legislature spends all the PFD and then there is nothing left. And when that happens, jobs will be lost and people will leave the state then.

      • What size would you propose for State government if the oil royalties were zero? Would you insist on a PFD as the only function of government in Alaska?

        • But it is not zero, deal with real numbers not imaginary what ifs. This state is spending more than it has got coming in, therefore cut spending

          • That’s where they are heading. Deal with that reality.

    • Move a million more people into the State and tell me what happens to your PFD, your roads, crime and prisons….

      .

      Could the State afford that or are you banking on demographic stagnation to keep Alaska “sustainable”?

  • There are different ways the Governor can approach this. First, he needs to exercise his power as the Chief Executive and Order the transfer of the Dividend Funds as per Statute. The APFC is bound to comply. If this results in action from the Legislature via the Courts, that is fine. We need to overturn the Wielechowski decision that allows unbridled license in setting the Dividend. Uphold the Law, Governor Dunleavy.
    Second, he can sign the Bill and accept the 1600 dollar dividend without damaging the cause. He can even use AS 37.07.080 to increase the Dividend amount to the Statutory total. Want to fight that too ? Bring it on !
    So we can have a dividend, and advance the cause for the dedication of the Dividend Funds. Get a legal team who will take this on, Governor. The Alaska Bar is backing the AK Supreme Court !

    • Boy Andrew you sure have a lot of legal advice for this Governor. Best get on with getting a job with Clarkson as he might not be around that long. You can bet that Meyer won’t be keeping any of Dunleavy’s people around when he takes over.

    • Checks and balances.

  • I echo the previous statement. I’d rather have our Governor veto the PFD this year and watch the elections next year. He’s got to stand strong. We elected him, never back down from these representatives that were elected prior to his Office. It will be better if we fight for our State and State rights. Also, make it a “People’s” vote legally for any change hereafter to the PFD by a 75% margin.

  • Stating that the dividend would have certainly been lower without dunleavys advocacy is pure speculation. The house was advocating for a 1600 PFD since their roadshow at the beginning of the session. This “rump group of citizens” wanting to hold out for a full PFD was “misguided” by Dunleavy AND Permanent Fund Defenders! You both chose this campaign, the people rallied behind you, and in the end, the governor and the defenders changed their position leaving supporters left hanging out to dry. Not only was the statute not followed, but now the dividend is paid from a mix of funding sources instead of strictly from the earnings reserve. So is it even really a ‘dividend’ at all anymore? The PFD is in worse shape now than it was a year ago and still no defined solution or path to get there. Disappointing choices made by disappointing leaders.

  • Caddy: I for one worked to get the votes necessary for a full PFD this last year. So did a lot of other folks.
    We never were able to get the necessary votes in the legislature for the full PFD, but it wasn’t due to lack of effort. There were various reasons why individual legislators did not vote to pay the full PFD but none were based on mean spiritedness or irrational criteria.
    At some point during the legislative session the PFD proposed appropriation was south of $1,000. Governor Dunleavy worked to boost the PFD from that low level.
    So Caddy, what do you recommend and sketch out your plan in how to protect the Permanent Fund and guarantee an annual PFD.

    • Oh, the things I would have done different. I recommend not leaving a ‘rump’ of citizens feeling hung out to dry. Dunleavy and the defenders have some explaining to do.

  • Any amount not paid from the Permanent Fund Earnings Reserve is by definition not a Permanent Fund Dividend. I support the statutory dividend, I do not support a mockery of a payment paid by various accounts and simply called a dividend for political expediency.

    Even if the entire State Budget was paid for out of the PF Earnings Reserve Account, there would still be more than enough to pay a statutory Permanent Fund Dividend.

    • Four-flusher, your opinions are just that.
      Where you are in trouble is that the POMV allows only so much to be transferred from ERA to GF. This is what limits the PFD to less than the statutory amount, according to many Legislators. They’ve allowed some other funds to bring the PFD up to $1600, since the GF transfer doesn’t cover this $1600. You don’t want to call it a PFD but tough noogies. You are alone here.

      • Bill,

        We’ve already established that the legislature can choose to disregard statute, to hang your hat on the POMV and how it works is naive at best since following the POMV is clearly breaking statue that has been on the books for decades.
        Of course from somebody who gets their opinions handed to them from the Juneau Empire, and freely admits it, the of lack of critical thinking is understandable. Arguing that a payment that is not a dividend from the PF Earnings Reserve is a Permanent Fund Dividend is so easily and demonstrably explainable that even a child can grasp it. Let me now explain it for you Bill. If the dividend were paid in apples out of a large bucket of apples but instead you were paid with oranges out of a couple smaller buckets of oranges would you be able to tell the difference?

        On a side note, and you may not recall this since it was yesterday, when you said “unfunded indebtedness is something that is a problem for Alaskans who could be counted on one hand” and then said, on your very next post, “I said nothing about it being a problem for so few people”. Have you been able to at least admit to yourself that you were wrong, or are you just going to pretend that didn’t happen? Just remember Bill, it’s OK to admit you are wrong.

        • Four-flusher, like I said it is the opinion of many legislators that the latest law (POMV) is the one to be followed, not mine.
          It’s quite simple and it’s those legislators who are running the show-too bad you happen to be on the wrong side. Tough noogies.

          • I’m glad the apples and oranges comparison helped you out there Bill, I was beginning to wonder if you were able to understand the difference between a Permanent Fund Dividend and money paid from other accounts.

            I also want to thank you for once again repeating somebody else’s opinion Bill and so freely admitting it, albeit after the fact. Why is it that you carry the water for others and then when questioned about it you shy away and admit that what it is you are parrotting isn’t your opinion but one that you took from somebody else? Nevermind, I think we all know the answer to that.

          • Four-flusher, you need my help to understand why it is you tend to be on the wrong side of Alaska politics.
            It’s really not that hard to understand, but you cling to your own interpretations of what should be happening but isn’t.
            Like I say, tough noogies!

          • Hahaha, now that is funny stuff right there Bill!

  • Look, this is all about negotiations. Bryce stopped by today and spoke to a bunch of teachers from our district. He took credit for the PCE, the scholarships, and a bunch of other stuff that our governor has signed into law. Even though he knows that most of that stuff was going to be in the capital budget by the reverse sweep and it was up to him and his legislation to put it on the governor’s desk he still played his politic card in front of a bunch of newly minted teachers and did what he does best. I’ve spoken to a lot of people in and around my village and they don’t want Bryce to take $10,000 away from their families each and every year for the rest of their life and they don’t want Bryce to take $400,000 away from their village for each and every year for the rest of their life. What they do want is for Bryce and the legislation to find a better way of paying the bills rather than stealing it from alaskans. We can’t afford that we live out in the bush or it’s very expensive and we need every little bit of help that we can to make ends meet phone paying for plane tickets to buying school clothes and groceries. Bryce thinks the better way is to take our PFD money and pay for all these social welfare programs Arizona State because he thinks he knows better than we do. I guess we shall see if this is true or not but our governor is doing us a great favor and holding this legislators feet to the fire Bryce even brought up the recall and said that if he don’t do what we say then there’s ways to take care of him which I thought was totally inappropriate given the setting but desperate times mean desperate measures.

    • Well negotiations are part of politics under a constitutional government.
      Is that wrong?

    • Paying bills without “stealing it from Alaskans”? Unicorn farts are for Commies.

  • I believe that Joe makes a compelling argument here. While I detest the bill the Legislature has delivered to Dunleavy it could get much worse if the Guv veto’s this measure.
    Let me explain, regardless of political affiliation one common denominator remains. Many Alaska Families rely on the PFD to get through the winter and to pay overdue bills. A veto of the sum allocated in the Budget could work politically for Dunleavy in certain sectors, I would support such a move, except, I know the downside. Political Games at the expense of families, real folks, not the special interest folks who hire lobby groups and make donations to Legislators. The little folks, the guy who works at the Quick-Stop with a young wife, or the girl who makes your coffee, you know the one who is saving to go back to school. Perhaps it’s that single Mom down the street with 3 kids’ you remember her, she works a low pay job 5 days a week and at the at the Alaska Club on the week end handing you a towel. These folks will lose if Dunleavy veto’s this measure.

    Reagan once said, I cannot always get what I want in politics, but I will take a half loaf today and try for a full loaf tomorrow.

    • That half loaf makes a lot of sense here Older. Those holding out for more don’t need the dough IMO.

  • Seems like quite a few are advising the Governor. The only advice he needs from all of you is to do the right thing. That’s not giving up on the Alaskans who elected him. That’s not making a deal to let the leftists steal the PFD or any part of it again, ever. The same old song about how he should capitulate and let the dim/leftist/socialists steal from Alaskans. No way! Veto the entire bill and support for the Governor will still be there. Give in and it won’t. Alaskans need that full PFD. Not pseudo “politicians” with no interest in their constituents and nothing new to offer. Balanced budget? Never happen if the Governor caves now. It’s been a long road getting to this point. Why make it worse? The voters need a say in this BS. Where’s that? It’s our PFD. STAND YOUR GROUND GOVERNOR DUNLEAVY.

    • Mr. Colder: Assuming the Governor heeds your advice and vetoes the appropriation for $1,600 after which the legislature appropriates nothing further for the PFD and Alaskans wind up with nothing, what is your basis for saying the support for the Governor will still be there?

      The column actually sketched out a path forward for both a full PFD and a constitutional amendment to guarantee the PFD. Is there something illogical about that potential path?

  • The governor could accept the amount and then call for an audit, increase the audit based on audited receipts for the years cut and statute on books not followed. He could use the audited results to increase the fund to full for this year and establish an application procedure for prior years when the statute was not followed and the funds were ignored by the governor or the legislature. Or he could appeal to the PFD corporation to pay the full amount to an account to be applied for by valid residents for the years not paid according to statute. The earnings above and beyond the required payments could be used to cover the costs of the mis steps by the legislature.

    (h) The increase of an appropriation item based on additional federal or other program receipts not specifically appropriated by the full legislature may be expended in accordance with the following procedures:

    https://law.justia.com/codes/alaska/2011/title37/chapter37-07/sec-37-07-080/

    • Quite a mouthful there, Stephen. Did that come to you in a dream?
      I’m sure Kevin Clarkson will want you on his team.

  • The Governor should not retreat, he needs to reload. Ask the people of Alaska to send him legislators that he can work with and that will support our laws and statues, including those governing the PFD.

  • Keep feeding the monster, see what happens.

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