PFD announcement fanfare is gone, as dividends are cut in half

Anchorage Permanent Fund Dividend Office 2016 03 14

Alaskans file their Permanent Fund dividend applications in downtown Anchorage in March 2016. (Photo by Rachel Waldholz/Alaska Public Media)

If the state budget didn’t lower Alaska Permanent Fund dividends this year, they would have been among the highest in state history at more than $2,300. Instead, they will be $1,100, deposited or mailed on Oct. 5.

The day that Permanent Fund dividends were announced used to be a celebration.

By 2015, Gov. Bill Walker had a grave tone, as Palmer middle-schooler Shania  Sommer announced a PFD of more than $2,000.

“Some may see this dollar amount, which Shania will announce and go, well, everything is fine,” he said. “Well, it’s not. We have some challenges as a result of the price of oil.”

This year was different again. The announcement came in a Friday afternoon press release.

Permanent Fund Dividend Division officials said they didn’t calculate what PFDs would have been, since it wasn’t necessary. Last year, the dividend amount wasn’t certain until the announcement, because it depended on the number of applicants who were eligible. This year, the Legislature set the amount.

Anchorage resident Andrée McLeod reached out to state officials, lawmakers and reporters, asking why the amount set by the original state law wasn’t made public.

“Why has this administration not gone through the process to actually inform and notice Alaskans what that exact amount of the dividend would have been had the Legislature not dickered around with our Permanent Fund dividend amounts?” McLeod said.

The amount of Permanent Fund earnings available for PFDs under the state law that created dividends was $1.55 billion. The state expects about 640,000 Alaskans to receive dividends.

Putting current state data through the formula in state law that historically set dividend values, PFDs would have been about$2,350 each.

That would have been the highest dollar figure in dividend history, without adjusting for inflation. With inflation, it would have been the fifth-highest.

Anchorage Democratic Rep. Andy Josephson said he understands why the administration didn’t announce the number.

“There was no hiding of the number,” Josephson said. “It was talked about all the time. So, I’m not quite sure what the complaint is. I understand why the Department of Revenue might not want to run a set of numbers that are sort of moot at this point.”

Josephson said the House majority he’s a member of didn’t want to reduce PFDs without adding new revenue. But he said a deal over dividends was necessary to avoid a state government shutdown.

“We were left with the following situation: Does the government shut down because the two sides are at loggerheads on the first of July or do we at least try to secure adequate public services for the people?” Josephson said.

The Legislature drew from another savings account – the Constitutional Budget Reserve – in order to cover the gap between how much the government spends and how much it brings in, in taxes, fees and oil royalties. Walker said he’ll call lawmakers back on Oct. 23 to Juneau for a fourth special session, focused on revenue.

Recent headlines

X