Kevin McCabe: Dividend, now buried in the operating budget, frustrates and fatigues Alaskans

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By KEVIN MCCABE

A sign has appeared in the middle of Big Lake with a red arrow pointing to my campaign sign.

This sign reads “PFD THIEF” and includes a disclaimer stating: “Paid for by Mike Alexander,” with his address. I know Alexander as a member of “Save The PFD,” a group based in Big Lake and led by Mike Widney. Both gentlemen have been politically active on Permanent Fund dividend issues in the past and usually provide invaluable PFD support and comments.

Both, however, have been mostly silent for the past two years. Mike’s sign is clearly a statement of their displeasure with my votes for budgets that included less than a full PFD. As single-issue advocates, they view any legislator who votes for a budget without a full PFD as a “thief.”

But is a vote for a budget that does not have a full PFD a vote against a full dividend? Perhaps if it were the only thing in the budget that would be true. 

The Alaska operating budget includes hundreds of line items that most Alaskans say they want. A sizable part of the budget has programmed funding that is automatic and committed before any broader budget discussions begin. This includes items like state worker pay, operating costs such as Medicaid and school funding, matching money for federal highway dollars, and funding for major school maintenance and pupil transportation, among others.

Additionally, the budget often contains appropriations for projects with a solid return on investment, such as airport and road upgrades. It also includes line items for things like childcare, substance abuse rehabilitation facilities, library rebuilds, and Pioneer Home roof replacements. A vote on the budget encompasses much more than just a stance on a full PFD or any other single line item.

However, there seems to be a disconnect in the “PFD thief” debate when discussing a budget that actually includes a full PFD.

SCS CSHB 281(FIN) amended Senate, which came before the House on May 14, 2022, was the last time in recent memory Alaskans had a chance at a full PFD. The Senate version of the operating budget, which would have paid over $5,000 to every Alaskan—young and old—was sent to the House for a concurrence vote.

After the Covid debacle, this would have been a huge financial boost, not only for Alaskans but for the state’s economy which could have generated billions of dollars in economic activity.

However, two of the most vocal “pro-PFD” legislators voted against this budget. Ironically, at least one of these legislators is still ardently supported by the “Save the PFD” group.

You might wonder why two conservative, Republican, pro-PFD Valley legislators voted against a budget that included the full PFD. Their excuse was that the spending was out of control — and they were right. At the end of the day, however, they still voted against a budget that had a full PFD. 

Even as the Save-The-PFD activists publicly shame other legislators for their supposed anti-PFD votes, this “no” vote on a full dividend in 2022, left out of the conversation about their PFD purity. A relevant question should be how is the no vote on the FY2023 (full PFD) budget, by these two legislators, any different from a legislator voting for a budget that has less than a full PFD?

All legislators have reasons for their budget votes; often driven by the needs of their districts. For the past few years, I had to consider the fact that our district senator is outside any caucus and had no opportunity to shape the budget so I had to do it for both of us. This is more important than creating hollow optics by voting against a budget, which is already destined to pass, simply because it lacks a full dividend.

Several legislators have written Pro-PFD pieces over the years. And many have at various times endured attacks, threats, and protests from Alaskans who focus solely on the PFD without fully understanding the broader budget process. I myself have written several such op-eds and weathered the attacks.

While my position is unchanged, I have noticed a shift in Alaskans’ views on a full PFD. Just in the past past year, I’ve received dozens of emails and public comments expressing, “Reduce or take my PFD—just don’t tax me.”

In contrast, I’ve lately received few messages in favor of a full or statutory PFD. I recognize that “dividend fatigue” has set in for many pro-PFD supporters; they’re simply exhausted from constantly writing and calling—and I don’t blame them.

Since the Gov. Walker veto in 2016 and subsequent court case, the PFD has been buried within the operating budget, making it difficult to determine which legislators are genuinely voting for or against the PFD. It should never have been reduced to a budget item, but that’s the reality we face until we collectively muster the will to resolve it.

The ongoing dispute over the PFD is frustrating for everyone, including pro-full PFD legislators like myself. The implementation of the Fiscal Plan, which many of us worked on during the 2022 interim, is long overdue.

Gov. Jay Hammond’s “militant ring” needs a legally binding voice—not the current arbitrary and convoluted two-statute system (or whatever).

Rep. Kevin McCabe serves in the Alaska Legislature on behalf of Alaskans in the House District 30-Big Lake area (formerly District 8).



34 COMMENTS

  1. McCabe voted against the PFD when he voted to swap out the Governor’s budget, which had a full PFD with the House version which didn’t. The House version was created by the House Finance committee that was run by Democrats put in charge of it by the “Republican” Caucus in the House. Kevin voted for those committee assignments.

  2. The PFD is the ultimate feeding trough. If you don’t keep keep that trough full, you will be the target of the parasites. It’s that simple, and it will remain so until every dollar of the fund is gone.

  3. Hoorah! Thank you Kevin for explaining the complications of the budget and why we are not getting our full PFD. It is not just 1 legislator’s choice! Between the House and Senate we have so called Republican’s voting w/democrats!!! When you have 3 in our Senate being chastised by the woke Senators and excluding true conservatives in this “democratic process” then we will not get what we are hoping for. Get your friends out voting and put true conservatives in that love the people of AK and are not just gas lighting us. Remember, if you keep putting in the same turn coats, you will get the same or worse outcomes. Don’t believe everything you hear in commercials or hearsay—go to the source! Speak to your candidates in person.

    I have not agreed w/everything Kevin has voted on; however, he has a lot of knowledge, sacrificied his retirement to try and make a difference. I can ask him anything and he will answer the questions and not divert his answers. Folks you have no idea what goes on behind the scenes as some are not civil and down right cruel to our electorate. Just look at the picture w/the thief sign; how mature is that???? I am sure glad Kevin doesn’t do the same in kind……………..Thank you for your hard work and perseverance!

      • You mean the guy who steals from dead people? The guy who was recalled from the MSB assembly because he was indicted for felony theft? the guy who was investigated as an assemblyman for steering MSB and state contracts to his buddies? the guy who buried a fuel tank behind his hardware store that was supposed to be properly disposed of? the guy who prevented the borough from building fire service up on Willow? The guy who charged people rent for storage on property he did not own?

        you mean THAT guy?

  4. We need to go back to the legal formula. Amend it if need be, but get it out of the hands of the legislature. Whatever that requires. Putting the formula in the Constitution to solidify it. As long as that original formula exists in law the cognitive dissonance will go on and on.

    • As long as the Legislature ignores the law and denies us the full statutory PFD, they are thieves. It is that simple. Amen to you Dave.
      Senator McCabe – your article speaks truth about the nature of legislative compromise, but obfuscates the issue. The cure for the situation is threefold: 1. CUT spending, including Walker’s Medicaid expansion, not just reduce the increase from what you thought you wanted to spend – which amounts to a net increase, not a real cut. Walker stole the PFD to pay for expanded obama Medicaid, now the PFD is just a general appropriation that gets distributed anywhere the Legislature votes it to. 2. FILL the pipeline – it’s our oil. I had this discussion with Senator Stedman who was then the Senate Finance Chair in 2022 after he presented the budget process and the “impossibility of balancing the budget without spending the PFD. He admitted that if we doubled the oil production (to about 900,000 bbl/day) there would be no need to steal the PFD and we would all get bigger PFDs. Tell the feds to obey he Statehood Compact and let us decide what minerals to extract and how to protect our environment! 3. Enshrine the Statutory PFD Formula in the Alaska Constitution.

    • Dave is exactly right. It’s a “Dividend” because Alaskans invested their property rights and deserve the “Dividend” on their investment.
      Every dollar the state spends is The result of resources owned by Alaskans and developed on behalf of the people of Alaska. Our State spending, divided among us, makes us the highest taxed Citizens in the Nation and just because the Feds print money doesn’t mean they don’t take from Alaskans also.
      Governments have no way of generating revenue other than taxes. Now they want our dividends, as if that will be enough. Beware, Like fire in your home, feed it too much soon it feeds itself.

  5. Strangely missing in the above article is how many times the author has tried to introduce legislation to un-“bury” the PFD. Perhaps he’s just to busy bringing home the bacon.

  6. Watch out the politicians have their hook into the peoples bank account and won’t stop until it’s all theirs.
    It’s called stealing folks and your money is being stole by greedy bunch of politicians watch them get rich off the Alaskan people.

    • “…….It’s called stealing folks……”
      That’s what taxes are, and that’s what they’re talking about next, while simultaneously playing the pinata game. If you think that will fly, you aren’t thinking.

  7. Cash us all out immediately one lump sump before the oath breakers rig it all away & please move the capital to anchorage, a child no a blind child can see this all. Maybe I outta be the next Governor yes

    • You really need help about your capital location fixation. God wants you to take an oath to get that help.

  8. The PFD is the second worse thing to happen to Alaska (with the first being the capital in Juneau). The PFD should be eliminated. Papa Hammond was a cynical and shrewd politician.

  9. McCabe just wants to feed heavy at the state trough.
    Once again illustrating how feckless and useless the AKGOP is.

  10. Another thieving legislator trying to explain how the issue is just too complicated for ordinary people to understand why he needs to steal our PFD. Here’s what I do understand. My brother just retired from the state at the age of 52. He had often bragged that he belonged to the strongest union in the state. Seems like those bribes, sorry, I mean political contributions, really do buy legislators, because our stolen PFD is paying for what my brother says is $84K per year pension plus health insurance for him and his wife for the rest of his life. Based on our family history, that could easily be 30-40 years. Takes a lot of stolen PFD to pay for that much gravy.

  11. Personally I hate the dividend, it should be used for infrastructure in Alaska. It should be invested entirely in Alaska. You morons who just want your stupid $2000 a year so you can donate it to Walmart for some plastic crap can stick it. The dividend was very poorly thought out. Hammonds heart was in the right place.

  12. This is hilarious! I hope that we get to see more signs around the borough pointing out more of the RINOs and demonrats.

  13. McCabe is a PFD thief. Thank-you to the bold sign designer and add that Dunleavy depends on those he paid off to steal from every person who has a right to expect better of the elected. McCabe can give all the excuses he wants but facts speak louder than words in retrospect of poor decision. Why does the Big Lake voting district keep this liar in the legislature?

  14. The loss to Alaskans by not receiving the statutory dividend now exceeds $40,000.00 for a family of four. Before SB-21 and the giveaway of Alaskan’s oil full dividends were always paid, because we had the money. We actually were able to place over $20 billion into savings before SB-21. After SB-21 we began, among other things, paying $8 dollars per barrel to have our oil taken from us in the most unbridled greed and corporate welfare we’ve ever seen. The oil company lobbyist- governor- Sean Parnell did Alaskans dirty. And we are paying a steep price. Our population is declining and we will soon not have enough money for funding the operating budget, paying dividends, and inflation proofing the Permanent Fund.

    We can fix this. Don’t vote for any candidate that refuses to ensure we get a fair return for our oil, which the Alaska Constitution requires.

  15. One of three constitutional proposals that Gov. Dunleavy put forth in his first year was to constitutionally guarantee the PFD but there was no support for it so the legislature let it die in committee, along with another proposed amendment that would have let Alaskans vote on all proposed taxes. Same thing – no support so it died in committee. Typical – legislature considers all financial matters its turf.

    • That was actually put forth by House Ways and Means, which was Carpenter, Mccabe, Tilton, Allard, and Mckay. it failed on he House floor because a constitutional amendment needs a 2/3 vote and zero of the minority were interestted. The idea of putting it in the Consitution came from the fiscal policy working group three years ago which Carpenter and Mccabe were part of.

  16. In 5 to 8 years from now the PFD will probably be bled dry, at about the same time TAPS finds itself unable to maintain the hydrostatic pressure to keep the oil flowing from the North Slope. Bush communities will keep electing representation that will voting services and money to their constituency which will effectively destroy the PFD by propping up a State budget that is unsustainable. Then will come the state income taxes, state sales taxes, etc. The population on the highway system will be the ones paying those taxes. Meanwhile half of the population, the half that doesn’t live on the highway system, will continue electing people to give them whatever they think they need. To pay for rural Alaska, the state will have no other choice than to levy a massive income tax on the residents living along the highway system, Juneau and Sitka. We’re talking probably 20% income tax, enough to make Oregonians and Washingtonians envious. At that point all of the worker bees on the highway system will abandon their hive and fly outside to a new home where they’re not being killed by taxes and the insane prices of commodities. This prediction doesn’t even account for the surging cost in electricity and gas that’s going to hit southcentral Alaska in the next year or three as the Oil and Gas companies fail to meet the demands because of litigation by the environmental litigation industry.

    • I think you’re wrong about Walmart. These dirtbags spend it on meth, tattoos, and purina pit bull chow. Wish we could spend the money on education and finally come in 49th for reading and math one of these years. The pfd attracts and retains the worst people here in Alaska. And yes, I’ll keep cashing my pfd checks meanwhile. Buy me some noise cancelling earbuds for all the redneck whining and machine gun fire in the Valley.

  17. The legislature should put the PFD out of bounds when doing the State budget and just budget with other funds as necessary. Maybe some fairy tale projects would have to wait, but from the standpoint “of the People”, they would receive what was rightfully theirs. When PFD money is used in calculating the State budget, it changes the equality of the money used. Large cities like Anchorage, receive the majority of funding concerning budget money. It makes it harder to account for and easier for graft and corruption in that extra gravy amount. Give the people the full dividend, and tax if necessary to accommodate all the little extras that the legislators each want. (Pork). Then the People really have a say.

  18. politicians are like bankers, their job description doesn’t include being your friend. take the best available data and craft a budget. the problem is the outflow to satisfy everyone is bigger than the inflow, hence rob the cash pot of the Permanent Fund.

    repeal SB@!, although it’s too late already. gone are the good old days, we’re Michigan now. a one trick pony that has moved on. Exxon is busy down at the huge find in South America, they won’t be back.

    Alaska better get its act together, we could be the next Arkansas or Alabama at this rate of decline.

  19. PFD – the PFD does not belong in the budget. Historically the PFD was outside the budget. It was a “transfer” not an “appropriation.” A possible compromise position of 50/50 POMV was put forth by Senator Shelly Hughes. This is NOT a bookend. She floated this as a compromise position. Not as a starting point.

    Those in the legislature who are intent on removing the entire PFD from Alaskans have refused to discuss even this compromise position. Nothing.

    com·pro·mise /ˈkämprəˌmīz/
    noun – an agreement or a settlement of a dispute that is reached by each side making concessions.

    Why is this so hard for some legislators to understand? It should be obvious to any who are watching how intent they are on taking your full PFD….. And the entire PF is next.

    We need legislators who are vocal about the PFD. We need legislators who are paying attention and who are talking to their constituents about the battle for our PFD and for our state. – Kevin McCabe 2019

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