Alaskans scorchingly reject Permanent Fund amendment

A proposal to enshrine the Permanent Fund Dividend in the Alaska Constitution met scorching opposition in public testimony Monday and Tuesday as Alaskans picked apart its language and criticized it for failing to accomplish its principal goal: protecting the dividend.

“It’s like throwing the public a bone after you’ve kicked them in the groin,” said Kurt Schmitt, a Delta Junction resident testifying by phone.

Forty-five Alaskans offered their thoughts on House Joint Resolution 23 between 7 p.m. and 9:15 p.m. Monday night. Not a single one offered definitive support for the amendment under consideration, though several offered support for alternative language.

In a Tuesday afternoon meeting of the House Finance Committee, more Alaskans voiced their disapproval. Two high school students from Southeast Alaska offered unqualified support.

HJR 23, containing the text of the proposed constitutional amendment, is being proposed by members of the coalition House Majority. According to its text, 4.75 percent of the average value of the Alaska Permanent Fund would be available for spending. Two-thirds of that draw would be spent on government expenses. One-third would be reserved for dividends.

Michael Chambers, testifying from Anchorage, said he believes “the most important thing out there is the language of ‘shall’ and ‘may.’”

Critically, HJR 23 states that “the legislature may provide for a dividend payment to state residents of not less than $1,250 for each resident each year.”

That language, if approved as a constitutional amendment, would allow the Legislature to approve a zero-dollar dividend, completely negating the concept behind the amendment.

Doug Gardner, the Legislature’s lead attorney, said on Tuesday that a constituional amendment including the word “shall” instead of “may” would run into legal problems with other portions of the Alaska Constitution.

“I think if we put the word ‘shall’ in, we’ll end up with, possibly, a bad litigation result … and none of this will go forward,” he said.

HJR 23 is also opposed by the Alaska Permanent Fund Corporation, whose director, Angela Rodell, told lawmakers that the corporation’s board of trustees disagrees with its approach because it allows the Legislature to take more money out of the Permanent Fund, even after the average-draw system is implemented.

Doing so, under HJR 23, would require a three-quarters supermajority vote of the House and Senate.

The risk of an extra draw creates instability, Rodell warned.

“It introduces that instability for perpetuity,” she said.

In a Tuesday morning meeting with reporters, Gov. Bill Walker was noncommittal about the measure, pointing out that he doesn’t get a say when it comes to constitutional amendments. Under the Alaska Constitution, if a supermajority of lawmakers (2/3 in the House and 2/3 in the Senate) approve an amendment, it goes on the ballot in the next statewide general election. If a majority of voters approve the amendment at the ballot box, it is accepted.

Any amendment approved by lawmakers this session would show up on this fall’s ballot because 2018 is a general election year.

In addition to the issue of “shall” and “may,” those offering public testimony keyed in on the amount of the split between state services and the dividend. Many advocated a 50/50 split first proposed by former Gov. Jay Hammond in his book “Diapering the Devil.”

That idea has since been proposed by several lawmakers but has not garnered any traction among the leadership of the House Majority or the Senate Majority.

“You guys are letting down the people of Alaska. You guys are ruining this state,” said Sally Johnson of Palmer.

Many of the people offering public testimony said recent cuts to the dividend and the proposed formula split amount to “stealing” the dividend.

Karen Perry of Chugiak pointed out Rep. Paul Seaton’s habit of wearing a flat cap in the Capitol.

“Rep. Seaton, I suggest you take off that silly hat and put on a pirate hat,” she said.

“You must stop violating God’s laws. The eighth commandment is thou shalt not steal,” she added.

Many also said they want to see a vote of the people on any Legislative action affecting the Permanent Fund and the Permanent Fund Dividend. They also cautioned that they will remember any action taken this session when November’s general election arrives.

“We’re looking at you. And we disagree with you. And we vote,” said William Lambert of North Pole.

• Contact reporter James Brooks at or 523-2258.

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