House Majority setting dividend at “what’s leftover”

By
Suzanne Downing
-
58
392

PFD WOULD BE ~$650 UNDER HOUSE BUDGET

In a House Majority press conference today, leaders of the Democrat-led bipartisan caucus acknowledged — in their own ways — that Gov. Michael Dunleavy is right about at least one thing: Alaska doesn’t have enough revenue to pay for the status quo budget without additional revenues. And they agreed that taxes are off the table.

Gone was the chest-beating days of House Speaker Bryce Edgmon, who in February angrily called the governor’s budget an “outrageous proposal.”

Now, Edgmon used softer terms: “The changes being proposed are pretty dramatic.”

They were striking a more conciliatory tone regarding the budget, and they were now stating publicly that Alaskans have spoken and are ready to give up much of their Permanent Fund dividends.

After traveling to eight communities around the state, the House Finance Committee co-chairs said that the vast majority of people who testified about the budget are opposed to the cuts proposed by Dunleavy. For every Alaskan who expressed support for the Dunleavy budget, another five testified against it, said House Finance Co-Chair Neal Foster.

Instead, they’re proposing an operating budget much like last year’s, but with about $47 million in trims to Gov. Walker’s nearly $6 billion spend. Dunleavy’s budget was such a shock to them, they didn’t even want to use it as the basis for their plan. Instead, the House Majority took up the budget of ousted former governor.

Speaker Edgmon said the Democrat-led caucus was formed around the principle of “providing a responsible budget that would protect essential services but also spend within the means of available revenue for the upcoming year.”

“It will be a budget that also contains a sustainable Permanent Fund dividend and doesn’t tap into savings in order to fund for it,” he said.

“You’ve got a governor’s budget that’s looking to displace cuts and possibly shift to local governments up to about a third of the overall budget, and then you’ve got a Permanent Fund dividend that’s twice the size it was last year. And so you’ve got sort of these ends of the spectrum, and our question…to a lot of Alaskans was, where do we meet in the middle? What essential services do you want, and what’s your version of a sustainable Permanent Fund dividend?” Edgmon said.

“A lot of Alaskans — not all — but a lot of Alaskans are willing to take a reduced Permanent Fund dividend,” he told reporters.

BUT HOW MUCH IS THE DIVIDEND?

Right now, the Permanent Fund dividend could be anywhere between $500 and the $3,000 Dunleavy has proposed, as he wants to return to the traditional formula and not turn the dividend into a political football.

Walker’s dividend amount was set at $1,800.

In the House’s “Leftover Dividend,” method, it currently looks like about $650. But the House has not actually put that down on paper.

“Right now our intent is to take care of the budget first, and then come back to the PFD amount later,” said Rep. Foster.

Rep. Chuck Kopp said that over the past few weeks he has seen more agreement among lawmakers, “paths coming together, rather than further divergence, a recognition that we can’t overspend, we can’t continue to go into savings, we can have a healthy dividend, and we can have good roads, schools, and public safety.”

58 COMMENTS

  1. Speaker Edgmon said the Democrat-led caucus was formed around the principle of “providing a responsible budget that would protect essential services but also spend within the means of available revenue for the upcoming year.”
    .
    One of the big sticking points is, what is considered essential services? There is no way in hell that it takes a budget in the billion$ to provide essential services to approximately 740,000 residents. Porked up, bloated giveaways aren’t essential services.
    .
    Nice try Rep. Kopp on tossing in the buzz words though: roads, schools and public safety. Kind of funny. When he says that he has seen more agreement among lawmakers, “paths coming together, rather than further divergence”, that usually means the Republicans are caving in (according to my commander cody decoder watch).

    • Garnet, can you tell me where you got your Commander Cody decoder watch/ring? Actually, I don’t need one to decipher the actions/intent of the supposed “conservative” leggies. One just has to look at their donor list on APOC, past connections such as AK State Troopers, etc.

      • Well the AK state Trooper connections are interesting. They are likely getting another 7.5% pay INCREASE. Remeber that Walker just gave them one. The legislature is following along with that plan and Gov Dunleavy wears a PSEA (Trooper Union) coat with the emblem so frequently he might just be an honorary member. But remember it’s not much money – just about 6 million dollars.

    • there is also a very important difference between costs and services – be they essential or not.

      Those who truly care about services should be focused on the costs of those services in order to get the most services and best. Unfortunately the silence is deafening. Nothing about how to reduce the cost of services. This is all about perpetuating inflated costs.

      • True. Cost of services is important. Cheapest doesn’t = better, but tighten it up! Essential is important. Lower costs and reduce the non-essential. Silence is deafening because the conversation doesn’t fit their narrative.

      • Agree. Seems to be that way at all government levels. We do seem to have an accountability problem in our state and there does not seem to be much effort in looking for ways to save money. Most departments just spend what they have. They do not try to spend less. I believe it is not a conscious thing, and there really has been no incentive to do otherwise.

  2. The people they talked to must be the same people that responded to the polls showing Hillary Clinton a huge favorite to win the presidency. Most people I know want a large dividend that we can use to revive the stagnant private economy, not continue to feed the bloated state government economy.
    I will not contribute one more dollar to ANY GOP political campaign if they fold on this issue. They were sent to REPRESENT we the people and not think their way is better.
    Their way is the way of the Roman empire and will lead to a total collapse of both the private and government economies.

  5. Less than 1 percent who voted for Governor Dunleavy is not a majority of Alaskans. I hope there is a massive recall of the legislators who vote for this crap. I also hope Governor Dunleavy vetos all the pet projects or just vetos the budget.

  6. Reason is finally starting to prevail! The Permanent Fund makes Alaska unique, as it creates the opportunity to enjoy a high level of State services, while living in one of the best and most beautiful places in the world. The extreme budget proposal of the Governor is finally wakening people from their slumber, and as they do, they are saying that they prefer smaller PFDs to a drastic reduction of State services.

    • If you want the PFD to be used for services than sends yours back. There are some individuals on the Kenai Peninsula that use the PFD for their own essential services like heating oil unlike the Bush that have a state program to supplement their essential services of utilities.

      • After four decades in the bush, you’re partly right.
        The Bush does have PCE, electricity, but that’s going away. Almost all of our electricity is produced by diesel produced at nikiski, which benefits the Kenai.

        The State has almost no roads to maintain out here, which urban Alaska has which to us are endless amounts of roads.

        The State doesn’t subdize any fuel costs other than what was used to produce electricity.

        Low income Alaskans everywhere can apply for energy assistance.

        Get one thing straight, villagers didn’t VOTE for Dunleavy because we’re the ones that are going to have to live with the consequences of pit mines.

        Villages aren’t in favor of giving up PFD. They use them for the same kind of bills you have.

        • So villagers didn’t vote for the candidate that wants to give the full PFD and back PFD money stolen by Gov. Walker? Now with a liberal controlled “bipartisan” caucus, villagers might get $500 – period the end. And the next time? And time after that? Then it is gone…sucked into the black hole of the general fund forever. And, with that liberal-led caucus villagers will continue to get a government controlled pork-a-thon that will keep them on the teet in perpetuity. Just what the “leaders” want. Lets not put money in peoples pockets or provide job opportunities – lets just keep the control…..

    • I call BS on your post. What you call “reason” is actually theft. The “extreme” budget of Governor Dunleavy is the only one that makes any fiscal sense at all. Your statement of “wakening people from their slumber” is a supreme fallacy. No one I know or have heard of, except public employee unions and teacher unions would ever agree to your untrue statement. You should be ashamed. Promoting theft should be a crime. I’m sure it is in certain circumstances. Abetting theft is more like the truth. Your buddy, thorson, must have received the same “talking points” that you did. Organized crime is what is facing Alaskans. That seems to be the only explanation for your and your cronies actions, opinions, lies and hostility towards our Governor.

      • Ben, “reason” certainly is a poor choice of words from Whidbey. And, those that needed “waking up” are the ones that apparently dozed off because they have been so comfy snuggled up to the government sucking the teet. All cuddly and warm next to mamma government nipple. I’ve been awake watching this sh*t show every time libs get a hold of the purse strings and get further “wakened” every time a lib screeches in agony when they have to give something up. I will agree with Whidbey on one thing: the Governor’s budget has got people talking but the left isn’t listening. WE DON’T HAVE THE MONEY FOR EVERYTHING. Pretty simple stuff.

  7. Contact your representatives, the time is now. Call, email, or show up in person. The roadshow echo chamber gave them exactly what they wanted.

    Don’t forget what role Gary Knopp has played in all this.

  8. Bryce is full of crap. Quinhagak ain’t ready to give up pfds. I’ve called friends in numerous villages and had them take the pulse at an earlier estimate of$680. No village, not even Bethel is ready to go where you wanted to take us.

    Bethel was a dog and pony show.

    Bryce just give me a call and I’ll give you a list of what to start investigating on the YK Delta to get costs in line.

    • Bethel would dry up into nothing without the vast amounts of state and federal money that gets dumped into that town. I lived there for close to a year while plumbing their swim pool and learned quit a bit about how that all works. It is the hub that supplies about 42 surrounding villages, which are all predominantly vote democrat for the easy government handouts.
      By the way… it’s not actually a swim pool. If they had called it a swim pool then bethel would have had to pay for it. Instead, they called it the Yukon-kuskoquim regional health and safety aquatic center so that the state and federal governments would pay for it.

  9. I’m surprised they have any left at all.This is what they do,spend other peoples monies.
    The Governor must line item veto down to a reasonable budget.The dividend rolling back into our economy is huge.
    Right now
    Republican =Idiot
    Democrat =Obstructionist
    One or both must change
    The swamp/good old boy club is strong for such a young state.It must be stopped.

  10. Don’t mean a thing…
    .
    Those who pay Alaska’s lobbyists about $20M annually to buy or lease the “Democrat-led bipartisan caucus” still get what they want.
    .
    The non-profit Alaska Municipal League, which represents over 160 cities, boroughs, and unified municipalities, will keep its $600M “Investment Pool” out of taxpayers’ reach.
    .
    The non-profit Foraker Group, which represents Alaska’s non-profits, reports non-profits, if considered as their own industry, are still the second largest source of nongovernment employment behind oil and gas in Alaska.
    .
    Nobody seems to represent Governor Dunleavy’s 140,000+ voters who’ll get “leftovers”.
    .
    And, the Great Alaska LeDoux Vote Experiment worked which means the Peoples “Democrat-led bipartisan caucus” is here to stay.
    .
    So, maybe the Peoples “Democrat-led bipartisan caucus” recalled what happened in the mid 80’s when the price of oil went way down and the price of government went way up…
    .
    …and figured tossing “leftovers” to productive Alaskans would help persuade them not to leave the state before they get stiffed with income taxes.
    .
    What’s not to like?

  11. How generous of the dims. Leave Alaskan citizens the “left overs” after they get through stealing our money again. I know the “Alaskans” who are “willing” to give up the permanent fund. They have been traveling around with the dims to the various State “roundtables”. They consist, mainly, of public employee union members, teachers’ union members, ultra-libs, etc.). That is not a fair representation of “Alaskans”. It is extremely frustrating for these “unionists and academics” to refuse to see the writing on the wall. Their scheme to steal the PFD will deplete the fund in a very few years. What then? Of course, the public employee unions and teachers union will still want MORE. Enough will never be enough for them. When you think about it, the unions/teachers would be the only ones to not give up their PFD. Not only would they keep theirs, they would steal every other Alaskan’s PFD. To hell with the rest of Alaskans, as long as they get what they want. Time to shut the BS down and support Governor Dunleavy’s budget. The only sane one.

    • Yes, the “leftovers”. Makes you feel like you’re raiding moms fridge at 2 a.m after sneaking in from partying too late. Scrounging around for what is left.

  12. The Alaska PFD was established in the Alaska Constitution by amendment in 1976. The language in the amendment was written to protect the funds from government day-to-day spending without a vote of the PEOPLE!!

    I have been a voter in Alaska since 1963. When did that vote happen? The answer is it didn’t. Put it to a vote of the PEOPLE! Then we will know the real numbers of people who want to amend the amendment to allow government spending.

    • Your history is incorrect and you are conflating the Permanent Fund and the Permanent Fund Dividend. They are two separate things. The PERMANENT FUND was established in 1976 (Article 9, Section 15 of the Alaska State Constitution). The PERMANENT FUND DIVIDEND is different. It was first established in statute (not the constitution) in 1980 but was ruled unconstitutional in Zobel v Williams. The PFD we know today did not exist until 1982 and was established in Statute, not the constitution.

    • I appreciate your passion, but your memory is imperfect. The constitutional amendment you cite specifically states in the last line, “All income from the permanent fund shall be deposited in the general fund unless otherwise provided by law.” That pretty much makes the funds spendable as permitted in statute and does the opposite you are claiming.

  13. It’s a bipartisan coalition. There are Republicans in this coalition. How did you survive before you received your pfd?? Life or death without your check? Teachers stealing your pdf, seriously, teachers stealing your pfd? If you can’t make a life in Alaska with out your “entitlement” every year, or simply bad financial planning on your part, maybe time to look into some where else. Cheaper for you. Las Vegas? Senior discount everyday.

    • Mark,
      Evidently, you were not in Alaska before the PFD. The PFD has made an incredible difference in the standard of living for all Alaskans. Yes, teachers and public employee unions are trying to, again, STEAL THE PFD. How is that so hard for you to understand. Oh, you must be a teacher or public employee. True?? The most likely ones to “survive” without the PFD are teachers and public employees. After all, they would not only keep their PFD, they would steal all other Alaskans’ PFD. I guess your warped thinking justifies that. You have a lot of nerve suggesting Alaskans that don’t like your theft of the PFD, move somewhere else. Why don’t you and your cronies go back where you came from? I have been in Alaska since 1951. My wife, kids, grandkids and great grandkids were all born here. How about YOU???? By the way, the PFD is not an “entitlement”. It is a dividend paid to Alaskans for refusing to bow down to people like you.

    • Why don’t you move to Las Vegas? I’m sure you will find more of “your kind” there. When you start bad mouthing Alaskans and their need for the PFD, you step over a line that you really shouldn’t. You think you are so astute. You are not! Stupid, is the word that readily comes to mind. You are not an Alaskan. You are straight out of the liberal swamp of the “outside”. By the way, “outside” means “other than Alaskan”. Alaskans’ money does not belong to you and your ilk. It belongs to Alaskans. Plain and simple. If you can’t “make a living” with your wages now, without stealing Alaskans PFD, maybe you should look elsewhere. Anywhere but Alaska. Try Venezuela.

  14. The Legislature and I are on the same page for the first time in my adult life.
    It appears the semi-bi-partisan coalition is actually a good thing.
    Here is the new equation (until oil prices shoot up again): Every $300 million in cuts adds $500 to the Dividend. Now…… go fight for it.
    P.S. What is the “official” amount of the 5.25% cap? It could be higher than people think. It could add
    $200 million as a last second surprise.

  15. The whole idea of an income or sales tax while still paying out a Dividend is so preposterous, its hard to believe anybody would support that.
    We should be grateful to this majority that those ideas were taken off the table. It also appears they will not borrow from the CBR – that is a good thing too.
    We are very fortunate to have the PF Trust fund to fund our government and dividends. We can still continue to debate the proper split.

    • Chris,
      A state income tax would be the most fair of all “income streams” for Alaska. I don’t like it either, but you don’t always “get what you like”. If you count up all the out of state fishermen, north slope workers, miners and non resident “visitors” that come to Alaska, make a huge amount of money, and LEAVE WITH IT, you would realize that the amount of $$ made in Alaska and leaving the state is atrocious. The amount of taxes that would be paid into Alaska is staggering. That, alone would fix Alaska’s revenue shortfall and leave the PFD alone. Common sense, anyone??

      • Sorry Ben – you are cutting our nose to spite our face as 90% of the tax would be paid by Alaska residents. If you really want to tax non-resident workers we should do the old “school tax” which was (back then) $25 then later increased to $50? In reality it was a high income tax on your first $100 of your first paycheck.
        The Dividend creates too many perverse incentives – it should end….

        • Chris,
          Not true! I know there was/is no constitutional provision for income tax. The income tax was started by a democrat president (Coolidge) so America could fund WW1. By the way, when the dim started the tax, he promised it would never go above 3%.

          If you count up the dollars made by out of state workers/fishermen/miners and all other non-residents, you would be amazed at the hundreds of millions (or more) dollars that are made by them in Alaska and they leave with it. Alaska has a benefit of ZERO from them. Instead, the entire burden of financing Alaska’s unbelievable spending is foisted upon Alaskan citizens. The outsiders walk and pay nothing for what is, arguably, the most lucrative situation for them in the world.

          If you don’t like Alaskans receiving the PFD, don’t apply for yours. That would be a big step towards credibility for you.

          • You haven’t acknowledged the fact that although you want to target non-residents, you will also target residents. Read my post again.

          • Chris, a great way for an income tax to target non-residents is to allow a credit for the PFD against the tax liability. And this would amount to a negative tax for those with no tax liability. This would necessitate a large tax rate to recover all that negativity as such a credit amounts to some real money.

          • “The income tax was started by a democrat president (Coolidge) so America could fund WW1.” Um, put down the bong, bro. Coolidge was a Republican, about as far to the right as you would find a hundred years ago, was elected vice-president in 1920 and ascended to the presidency in 1923, after the war was over.

      • Ben, I respectively disagree with you. First, many of those people working on the north slope are very specialized. Specialized meaning many Alaskans don’t have the skills without leaving the state to learn how to these kinds of jobs. Second, regarding all those commercial fishermen, I certainly don’t hear any Alaskans screaming for those jobs. And many Alaskans actually are commercial fishermen. Third, there are lots of Alaskans that are miners. Several Native Alaskan Corporations are part of those pushing for various mines to be opened so that their villages can work.
        Can you please show me where you found evidence that those out-of-state workers “make a huge amount of money, and LEAVE WITH IT…”? Can you please show evidence that the “amount of taxes that would be paid into Alaska is staggering”? I’d certainly like to see those studies and, if are true, I may change my mind about the need for an income (or sales) tax.
        I am against any new taxes, income or sales. You may think all those rich out-of-staters would fund our bloated government, but you forget the number of Alaskans that don’t work (thus not contributing) or are low income and already struggling to survive (like Anchorage). And sales taxes may hit all those tourists, but are destructive to many villagers.
        If you hate out-of-state workers, why not push the University to create courses that would help train those specialized north slope jobs, or chat with your representative about legislation to decrease the number of out-of-state commercial fishermen? Fact is, both the oil and fisheries are declining already. Adding more State taxes certainly isn’t a way to welcoming new non-oil, non- fishing companies to locate here to stimulate the economy.
        Any Alaskan is able to send checks to the State Revenue Office. If you’d like to pay an income tax, no one is stopping you from sending a monthly check to the State Revenue Office.

        • S.,
          Twisting my words is not an answer. You seem to know a lot about everything.
          I don’t care if “outside” specialists work on the slope or anywhere else. If an Alaskan (highly skilled) went to “California”, for instance, do you think they would be allowed to leave the state without paying their tax? Of course, Alaskans work at pretty much anything they can get. They have to. Especially with the PFD being stolen from them. As for the owners of the mines and fishing operations, I do know what I’m talking about. I was a commercial fisherman most of my life. I know first hand how many outsiders own the fishing operations/boats, tenders, canneries, cold storage plants, and mines, etc. Until you know what you are/are not promoting, maybe you should curb your tongue a little, knave.

          I am not in favor of any tax and I don’t hate outsiders. I am in favor of keeping my PFD. The income tax would be the most fair way to finance the state gov’t and prevent the dims from stealing the PFD again. Then, everyone that makes their living by “using” Alaskan resources would pay their “fair share”.

          The university has one of the lowest graduation/accreditation scores in the country. Do you really think they would do better with your suggestion? AVTEC would suit what you are espousing perfectly.

          • B., Calling me a “knave” still doesn’t prove your underlying premise about income tax is the most fair. How did you come up with your statistics? That’s all I was asking for. I certainly wouldn’t consider myself knowledgeable at everything, but I am an avid reader regarding Alaska specifically and economics in general, regardless of the source.
            And I need to know what I/I am not promoting? I believe that there are several major cuts to the State budget can be made before resorting to more taxes, especially to low-income workers.
            I endorsing State economists recommendations that UA consolidate and dismantle the duplicate programs, advocate charter schools and vouchers, and see the need to drastically cut administration, both State and schools (not the actual teachers but administration). I advocate a decrease of the number of State workers we have because the pensions are unsustainable. I champion Right to Work and non-unionized private-sectors to compete for State RFPs. I’m ambivalent about the PFD but I believe it’s up to each person to decide if they want it or not.
            You can disagree with me, that’s your right, but please don’t call me names. It doesn’t promote civil discussions.

  16. “Dunleavy’s budget was such a shock to them, they didn’t even want to use it as the basis for their plan. Instead, the House Majority took up the budget of ousted former governor.”

    Translation: “we’re going to totally ignore why Dunleavey was elected and the mandate he was elected with, and it’s going to just be business as usual. We’re going to accomplish this with the help of a couple of traitors who ran as Republicans but had every intention of being on our side in this dog and pony show, and there’s nothing you can do about it”
    ~Democrats

  17. Where is Sen. Wielechowski? I don’t read everything but I don’t recall hearing/seeing a peep out of him lately. He can’t be happy with this PFD BS. He and other Dems have run on touting the PFD and getting it to the people. Promises, promises, that they are suddenly silent about?
    .
    When the welfare gets bigger and the PFD smaller, I hope there is a revolution of their constituents and they remember at the voting booth.

    • Wielechowski is letting others carry the ball for now. He just got his butt spanked in the Alaska Supreme Cout unanimous decision. His allies are Republicans like Rick Halford and Clem Tillion. So I don’t know what he was thinking.
      The Dividend is not an entitlement – it should only be paid for performance – just like any other corporation.

    • Ed, you are wrong. The CBR is still owned by the State. It is our only real emergency fund for catastrophic situations. It is a check on State overspending. Would you rather just spend us down to the bottom?

    • Ed, statutes are irrelevant. The Alaska Supreme Court has ruled that the Legislature can ignore any previous statute – if not, it would let one legislature unconstitutionally restrict a future legislature.

  18. “We must not let our rulers load us with perpetual debt.
    We must make our election between economy and liberty
    or profusion and servitude.
    If we run into such debt, as that we must be taxed in our meat and
    in our drink, in our necessaries and our comforts, in our labors and
    our amusements, for our calling and our creeds…
    [we will] have no time to think,
    no means of calling our miss-managers to account
    but be glad to obtain subsistence by hiring ourselves
    to rivet their chains on the necks of our fellow-sufferers…
    And this is the tendency of all human governments.
    A departure from principle in one instance
    becomes a precedent for [another ]…
    till the bulk of society is reduced to be mere automatons of misery…
    And the fore-horse of this frightful team is public debt.
    Taxation follows that, and in its train wretchedness and oppression.”
    — Thomas Jefferson
    (1743-1826), US Founding Father, drafted the Declaration of Independence, 3rd US President

  19. Caution to Alaska retail stores:

    Buy huge quantities of RED pens to send to the legislature and to the Governor. There’s going to be a run on them when people figure out that “our” legislators are fixing to smash your family’s piggy banks AGAIN. Governor: Show you did not speak with forked tongue concerning the PFD – veto any raid and, if necessary, shut down government show you mean it.

  20. The handout groups shut down the liquor store in Bethel. The people showed the city council and attorney what they thought of that, opened another one and working on another one. The leaches can’t stand free Enterprise. Veto pen rules. Shut the leaches down.

  21. Folks, if you really need a PFD handout to afford to live in Alaska, perhaps you should consider living in a less expensive place. If Jay Hammond were still around, I’m sure he would regret starting the whole dividend thing, after seeing the attitude of entitlement and dependency it has created. The Curse of Oil has struck again, and this time with a particular ferocity.

    Reduce State spending, trim back the PFD, put on some tax. Share the burden of your new economic reality. Face the music.

    • Ed, I have to withdraw from Whidbey. I am hiding under your comment post. I can’t take anymore. Tax and spend. Tax and spend. Take, take, take….
      .
      One, two, three, four, five, six, seven, eight
      Schlemiel! Schlimazel! Hasenpfeffer Incorporated
      We’re gonna do it!

  22. Government will spend every dime it can appropriate, justify it, and ask for more. A state spending cap, a real one, is absolutely required. Remove any legislator that does not support a spending cap.

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