Alaska House committee votes against $3,000 PFDs over concerns about future permanent fund earnings

Palmer Republican Rep. DeLena Johnson pauses before commenting on her budget amendment to pay $3,000 dividends on Thursday in the Alaska State Capitol in Juneau, Alaska. Rep. Adam Wool, D-Fairbanks; Rep. Andy Josephson, D-Anchorage; a committee aide; Rep. Sara Rasmussen, R-Anchorage; and Rep. Kelly Merrick, R-Eagle River, are behind Johnson. (Photo by Andrew Kitchenman/KTOO and Alaska Public Media)
Palmer Republican Rep. DeLena Johnson pauses before commenting on her budget amendment to pay $3,000 dividends on Thursday in the Alaska State Capitol in Juneau. The amendment was defeated by a vote of 8-3. Rep. Adam Wool, D-Fairbanks; Rep. Andy Josephson, D-Anchorage; a committee aide; Rep. Sara Rasmussen, R-Anchorage; and Rep. Kelly Merrick, R-Eagle River, are behind Johnson. (Andrew Kitchenman/KTOO and Alaska Public Media)

The Alaska House Finance Committee rejected a proposal on Thursday that would have paid out permanent fund dividends of roughly $3,000 this year.

It was the first salvo in the annual argument over whether the state should follow the formula in a 1982 state law or follow a different law that limits how much can be drawn from permanent fund earnings.

Palmer Republican Rep. DeLena Johnson proposed the amendment to pay $2 billion for PFDs. She said lawmakers have avoided making other difficult decisions by not paying full dividends the past five years.

“By not paying the full, statutory PFD, it’s allowed us to kick the can down the road,” she said.

Her amendment was defeated by a vote of 8-3. Along with Johnson, Nikiski Republican Rep. Ben Carpenter and Nome Democratic Rep. Neal Foster voted in favor of the statutory PFD. Johnson proposed another amendment that would have used some federal American Rescue Plan Act money for full dividends, but it was defeated by the same count.

One of the votes against Johnson’s amendments was Anchorage Republican Rep. Sara Rasmussen. She had proposed making full dividends this year dependent on changing the formula for future dividends.

After Rasmussen’s proposal was voted down, she said she was concerned that the state would pay full PFDs until the permanent fund’s earnings reserve is emptied.

“I’m willing to have the conversation about the one-time, last statutory dividend, if we can find resolution,” she said. “But until we can reach a consensus, I will not be supporting it.”

The committee finished its budget amendments and moved the bill out of committee Thursday night. This sets up the budget debate in the full House this weekend.

This story has been updated to reflect that the committee finished its work on the budget amendments later on Thursday night.

Andrew Kitchenman

State Government Reporter, Alaska Public Media & KTOO

State government plays an outsized role in the life of Alaskans. As the state continues to go through the painful process of deciding what its priorities are, I bring Alaskans to the scene of a government in transition.

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