It’s likely that Alaska Permanent Fund dividends will be roughly $1,600 this year. That’s because the Senate Finance Committee’s draft version of the state budget introduced Thursday includes the same amount as the House’s.
The committee budget would cut $98 million to fund the operations of state government from the House’s version of the budget, House Bill 286. Most of those cuts would be to Medicaid.
The Senate would provide funding for public schools in a separate bill, House Bill 287, by drawing $1.8 billion from permanent fund earnings.
Bethel Sen. Lyman Hoffman, a majority-caucus Democrat, said that bill should provide reassurance to schools.
“It’s important to note that, with the adoption of this, depending upon how long our session goes, that the education community will not have to give out pink slips,” Hoffman said.
In addition to the public schools funding, another $2.7 billion would be drawn from permanent fund earnings to help pay for the budget and PFDs.
The Senate draft budget would include $184 million for oil and gas tax credits. The House budgeted $49 million. The two bodies interpret the amount of credits under state law to be different.
Eagle River Republican Sen. Anna MacKinnon described the committee’s goals during a press conference.
“Alaska’s faced huge deficits,” she said. “We’ve drawn down our savings account and we are looking for ways to stabilize both Alaska’s economy and to provide opportunities and optimism for Alaskans.”
The draft budget relies on a $700 million draw from the Constitutional Budget Reserve, the piggy bank the state has used to cover spending gaps in previous years. The school funding bill would allow the CBR to grow, since the permanent fund earnings would replace spending that would otherwise come from the CBR.
The education funding bill could also provide early funding for education for the fiscal year that begins in July 2019. But it would only do that if the House and Senate reach agreement on Senate Bill 26, a long-term plan to draw money from permanent fund earnings to pay for state government.
The Senate Finance Committee will hear public testimony on the budget and school funding bills Friday morning, beginning at 9 a.m.