There are three proposals to help close the state’s budget shortfall using the Permanent Fund. Legislators are weighing which — if any — to support.
On Monday, they heard from their own nonpartisan budget expert on what makes each plan unique.
David Teal, the director of the Legislative Finance Division, noted these proposals would all change the source of Alaskans’ annual dividends.
“Essentially, the money appears to just fall out of the sky,” Teal said. “The truth is that the dividend is a government check, just like any other government check. And that it’s very protected now.”
Anchorage Republican Rep. Mike Hawker’s bill would essentially put dividends on hold – potentially for multiple years – until the state eliminated its deficit.
Gov. Bill Walker’s plan would put $3.3 billion annually into the budget – providing a less volatile source of revenue than oil production taxes.
Anchorage Republican Sen. Lesil McGuire has proposed the third proposal.
All three plans would likely reduce the amount available for dividends.
Big Lake Republican Rep. Mark Neuman said he’d like to see voters have a direct say in how much the government spends.
Teal responded that just cutting dividend checks may catch the public’s attention.
“Every expenditure means there’s less money for my dividend,” Teal said. “And if that happens, you may have the public looking over your shoulder a little more than they do now, as you prepare the budget. So, I guess, fair warning: Be careful what you ask for.”
It’s not yet clear when the House will vote on legislation that would affect the Permanent Fund.
