COMMITTEE ALSO MOVES TO BEEF UP PERMANENT FUND CORPUS
The Alaska Senate Finance Committee approved amendments boosting this year’s Permanent Fund dividend to about $3,000 and transferring $12 billion from the Permanent Fund’s Earnings Reserve Account into the fund’s constitutionally protected corpus. The Permanent Fund Earning Reserve Account currently has more than $18.6 billion.
“We must take effective action to protect the Permanent Fund,” said Sen. Bert Stedman, who co-chairs of Senate Finance Committee. “Today’s proposals recommend paying the full, statutory dividend amount this year, locking up $12 billion into a vault and throwing the keys away.”
Including a $3,000 dividend in the Senate’s version of the budget creates the possibility for a House and Senate conference committee to negotiate up to the full, statutory dividend amount. Gov. Michael Dunleavy has said the state must return to the statutorily defined Permanent Fund dividend to avoid the mistakes of the past, which made the dividend a political football.
The Alaska Permanent Fund currently has about $65 billion in assets. The $18.6 billion in the earnings reserve account can be spent by the Legislature with a simple majority vote. The amendment adopted by the Senate Finance Committee today would move $12 billion from the earnings reserve into the corpus, which cannot be accessed without changing the Alaska Constitution.
“This amendment moves $12 billion into the Permanent Fund’s corpus, protecting those funds for future generations,” said Senator Natasha von Imhof, co-chair of the Senate Finance Committee. “It imposes a spending cap on state government and forces the conversation on a sustainable dividend calculation.”
Once the operating budget is moved out of the Senate Finance Committee, it will be considered by the full Senate.
The House has approved a budget that leaves about $1,200 for the Permanent Fund dividend. The differences between the House and Senate budget are worked out in conference committee.
“The Permanent Fund is not for us to squander,” Sen. Stedman added. “Our generation has been very fortunate over our working lifetime with the oil boom. We need to ensure this fund is available for our grandchildren and great grandchildren.”
Thank You! Not only important to folks in Anchorage, but essential for the folks living in bush Alaska.
Not breathing well yet. Stedman on a Channel 11 interview said in essence that Gov Hammond and the legislature did not anticipate where we are today and would not have done the PFD today like they did back then. I’ve called Stedman’s office and told him to try and repeal and replace to what he thinks it should be if he feels that Gov Hammond and the legislature then were wrong.
Bottom line is, we must get the budget in line with revenues (existing, not taxation) with spending and the PFD must be paid full boat as well as the Constitutional amendment must be passed by the legislature and then we the people will vote it up or down. I will vote for.
The House will authorize $1600. The Senate wisely high-balled at almost twice that. Expected payout: about $2200 to $2300. Of course, Governor Dunleavy could get tough and veto and ask for $3600. That would put us back into the $3000 range. Should be interesting. I hope the Governor keeps his word.
The legislature will send the (reduced) PFD to Gov Dunleavy as a stand-alone bill, forcing his hand. He’d be crazy to veto it. By doing this it takes the PFD of the table as a bargaining chip. Gov. Dunleavy has lost on this front and he should concede.
The budget will be in a separate bill with about 250-400 million in “cuts” pulling $ from the ER. Dunleavy will either line item or fully veto the budget and we’ll see a shutdown. Gov. Dunleavy still has the upper hand on this however. His only doomsday scenario would be if the legislature sent him a budget with a vote of 3/4 of both bodies, highly unlikely.
Go Govenor ??
All Alaskans should help Governor Dunleavy keep his campaign promises to refund our ‘stolen’ PFD MONEY and put the language into our Constitution so that we don’t have to fight this fight again. THE MAIN PROBLEM IS THE LEGISLATORS WHO NEED TO BE VOTED OUT OF OFFICE. TAKE THEIR NAMES AND SEND THEM ‘SOUTH’ DURING OUR NEXT ELECTION CYCLE.
I wont be voting for those government officials who stole and squandered and are for stealing and squandering the pfd…..
They created deficits when they offered big oil tax breaks and passed bills that amount to billions of dollars tax breaks per year to big oil companies… And with stupid spending and government waste and funding what only a few people not the majority use or benefit from… Also the life time $500,000 per year for all government officials who do 2 to 4 year terms is not sustainable… And a lot of government jobs could be cut where people are being paid to say no and do nothing and where it takes 3 people to do 1 persons job because 2 are lazy on their phones or internet all the time.
The “house” is currently not a “house”. It’s a liberal “shack”.. A “house” of cards, that will come tumbling down. Like Margaret Thatcher said: ” The problem with socialism is that, sooner or later, you run out of other peoples’ money”. She was absolutely right. Just like “negotiating” a public union “contract”. All with “other peoples’ money”. If only the dims had to bear the brunt of their stupidity themselves, especially financially. I’ll guarantee you, they would be singing a different tune then. Liberal spending is happening so ridiculously, often and blatantly, I have shortened the term “other peoples’ money”, to OPM, so it doesn’t take so long to repeat it constantly. We surely will be hearing more of that term in the near future. Look what the libs/dims are doing to the Anchorage property owners. Disgraceful. For what? It’s never used for what they claim. Maybe they want to spruce up “Loretta Lynn” park. Fitting.
Not sure I follow your logic, CB. The PFD is the governor’s winning campaign centerpiece. A stand alone bill may be what comes out of the Legislature. But how does his concession to whatever PFD amount the legislature derives in Conference Committee afford him a bargaining chip, especially when the Legislature will lowball him on budget reductions. I think it’s the reverse. Stay firm on the PFD and use THAT as leverage to allow some increases with the budget. And please dont tell me that the math negates a balance. There are many accounts that the State of Alaska can use to address the revenue issues. Most people don’t know this. The PFD is the winning ticket for Dunleavy. Let the clowns in the Legislature squirm and fight amongst themselves.
Senator Stedman’s rationale for appropriating $12 billion from the PF earnings reserve to the corpus of the Permanent Fund is curious. To my knowledge, up until last year NO PART of the earnings of the Permanent Fund had been used for any purpose other than the payment of dividends. My understanding is that last year part of PF earnings were used to support the operating budget. Saving money, including “for future generations” only makes sense if the money is somehow used. Absent use, the money might just as well be burned in a big pile. Putting money into the corpus will produce higher earnings in future years but will do nothing to improve the Alaska economy or the citizens. What is the qualitative difference between as PF corpus of $65 billion and $77 billion? What can be achieved with the larger amount that cannot be achieved with the smaller amount? When the higher earnings are achieved in future years, then what?
This is known as horse trading, Jmark. There are several tradeoffs that are important here-the big kahuna, of course, is keeping the demand for an income tax at bay IMO. The little guys have been taxed approximately 50% of their PFDs for how long now with the fat cats laughing all the way to the bank.
Another trade is getting the Gov. on board with their lesser than $1.6 billion in cuts (they have to give him something).
How much longer can this be maintained? Heheh!
The last estimate of the “no borrowing” House Dividend was $1284 from a vague source. So the Senate proposed $3000 Dividend would force raiding above the 5.25% statuary limit dfrom the PFER or borrowing again from the CBR. The Senate could also propose large cuts to the House budget to “balance” the books.
It would be helpful to see the latest actual estimates.
Also, moving the $12Billion to the corpus is ridiculous when we owe the CBR the same amount. The legislature should move at least $4Billion from the PFER to the CBR. I would also pay off the oil tax credits (at a discount) from the PFER.
Oil tax rates need to be looked at too. But please let’s get our house in order first!
Probably not going to be any balancing of the books here IMO. The “hobnail boots” crowd is voting to take the cash but there is also little interest in the idea of prolonging our recession so what’s left but another deficit spend (this time from ER of PF).
May go over the 5.25% POMV limit but who’s counting?
I am relatively new to Alaska (March 2017), but I see that politics is no different up here. People’s word is no longer their bond, something to be tossed aside whenever it becomes the slightest way convenient. Sooner or later the people will have had enough and then all the PFD in the world will not save the politician’s careers. Shouldn’t be long by the looks of things. Sad, so very sad!
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