In this Feb. 18 photo, Sen. Natasha Von Imhof, R-Anchorage, co-chair of the Senate Finance Committee, asks a question while listening to a presentation by the Department of Education and Early Development at the Capitol. (Michael Penn | Juneau Empire File)

In this Feb. 18 photo, Sen. Natasha Von Imhof, R-Anchorage, co-chair of the Senate Finance Committee, asks a question while listening to a presentation by the Department of Education and Early Development at the Capitol. (Michael Penn | Juneau Empire File)

Senate panel puts full PFD in budget draft with caveat

Dividend estimated at roughly $2,900 to $3,100

The Senate’s budget-writing committee voted Friday to include a full dividend payout from Alaska’s oil-wealth fund this year, with the caveat that it could still be negotiated.

The Senate Finance Committee also approved moving $12 billion from the Alaska Permanent Fund’s earnings to its constitutionally protected principal. Committee co-chairwoman Natasha von Imhof said such a move would protect funds for future generations and force a conversation on redefining the dividend calculation.

Fund earnings have long been used to pay residents annual dividend checks. Lawmakers last year also began using earnings to help pay for government, creating tension.

Lawmakers passed a law last year intended to limit what could be taken from earnings for government and dividends, though critics say it can be ignored. The law calls for a withdrawal of $2.9 billion for the coming budget year.

The fund overall was valued at $64.5 billion at the end of March, according to the Alaska Permanent Fund Corp., with the earnings portion valued at $18.4 billion.

The cost for a full dividend — which has been estimated at roughly $2,900 to $3,100 to each recipient — is $1.9 billion.

Senate Finance Committee co-chairman Bert Stedman expects the ultimate size of this year’s check to be decided through negotiations. The House’s version of the budget did not include a dividend amount.

“It’s what the House and the Senate work out together and the governor will support,” the Sitka Republican said in an interview. “Clearly the governor’s standing firm on a full statutory dividend, and we’ve showed at Senate Finance that the paying of that full statutory dividend is extremely difficult this year and it’s going to be virtually impossible next year.”

Gov. Mike Dunleavy has said that lawmakers should follow the dividend formula in state law that has not been followed the last three years as the state grappled with a still-unresolved budget deficit.

Dunleavy also called for a level of budget cuts that lawmakers so far have rejected, along with tax collection shifts that would benefit the state at the expense of some local governments.

Besides the earnings reserve, there is a budget reserve fund the state has been drawing down that requires a three-fourths vote in each chamber to tap.

Von Imhof, an Anchorage Republican, said the state needs to live within its means and pay a dividend it can afford. She said she would offer reluctant support to the issue because it’s subject to negotiation.

Members of the committee have batted around ideas for what shape the dividend program could take in the future and other ideas are floating around the Capitol.

Some lawmakers support putting a dividend formula of some sort in the constitution. Dunleavy has pushed for a constitutional amendment that would let voters decide any proposed change to the program.

Dunleavy lauded the Senate committee’s move to include a full dividend and said he hopes it passes the Senate and House.

The Senate still must pass a final version of the budget, and the House will have to decide whether to agree to it.

“They’re going to have to get that additional money from somewhere,” House Speaker Bryce Edgmon said of the Senate’s plan. And if the Legislature approved a larger dividend, “will it also result in the governor still making large vetoes?” Edgmon told reporters.

Dunleavy spokesman Matt Shuckerow said the governor maintains that the state needs to spend in line with revenue.

“The governor has said all along that the Legislature needs to find ways to pay for things,” he said.

• This is an Associated Press report by Becky Bohrer.

More in News

A Princess Cruise Line ship is docked in Juneau on Aug. 25, 2021. (Michael Lockett / Juneau Empire File)
Ships in Port for the week of Sept. 25

Here’s what to expect this week.

People work together to raise the Xa’Kooch story pole, which commemorates the Battle of the Inian Islands. (Shaelene Grace Moler / For the Capital City Weekly)
Resilient Peoples & Place: The Xa’Kooch story pole — one step toward a journey of healing

“This pole is for the Chookaneidi, but here among us, many clans are represented…”

A bracket fungus exudes guttation drops and a small fly appears to sip one of them.( Courtesy Photo / Bob Armstrong)
On the Trails: Water drops on plants

Guttation drops contain not only water but also sugars, proteins, and probably minerals.

A chart shows what critics claim is poor financial performance by the Alaska Industrial Development and Export Authority, especially in subsidizing private industry projects intended to boost the state’s economy, during its 55-year existence. The chart is part of a report released Tuesday criticizing the agency. (MB Barker/LLC Erickson & Associates/EcoSystems LLC)
AIDEA’s fiscal performance fishy, critics say

Report presented by salmon industry advocates asserts state business subsidy agency cost public $10B

Police vehicles gather Wednesday evening near Kaxdigoowu Héen Dei, also known as ]]Brotherhood Bridge Trail, while investigating a homicide. (Ben Hohenstatt / Juneau Empire)
Police: Woman was walking dogs when she was killed

JPD said officers are working “around the clock” on the criminal investigation.

In this photo provided by the U.S. Coast Guard, a Coast Guard Cutter Kimball crew-member observes a foreign vessel in the Bering Sea, Monday, Sept. 19, 2022. The U.S. Coast Guard cutter on routine patrol in the Bering Sea came across the guided missile cruiser from the People's Republic of China, officials said Monday, Sept. 26.  (U.S. Coast Guard District 17 via AP)
Patrol spots Chinese, Russian naval ships off Alaska island

This wasn’t the first time Chinese naval ships have sailed near Alaska waters.

An Alaska judge has ruled that a state lawmaker affiliated with the Oath Keepers, Rep. David Eastman, shown in this February 2022 photo, may stay on the general election ballot in November even though he's likely ineligible to hold public office  (Peter Segall / Juneau Empire File)
Judge keeps Oath Keepers lawmaker on November ballot

Judge ordered delaying certifying the result of the race until a trial scheduled for December.

Water rushes down Front Street, just a half block from the Bering Sea, in Nome, Alaska, on Saturday, Sept. 17, 2022 as the remnants of Typhoon Merbok moved into the region. It was a massive storm system — big enough to cover the mainland U.S. from the Pacific Ocean to Nebraska and from Canada to Texas. It influenced weather systems as far away as California, where a rare late-summer storm dropped rain on the northern part of the state, offering a measure of relief to wildfire crews but also complicating fire suppression efforts because of mud and loosened earth. (AP Photo / Peggy Fagerstrom)
Repair work begins in some Alaska towns slammed by storm

ANCHORAGE — There’s been significant damage to some roads and homes in… Continue reading

Sniffen indicted on sexual abuse counts

Sniffen will be arraigned Monday.

Most Read