On Sept. 23, Alaska Gov. Bill Walker announced the value of the 2016 Permanent Fund Dividend would be set at $1,022.
Set for distribution
on Oct. 6, this year’s annual payout to the state’s more than 643,000 eligible residents is about half of what it might have been, after a series of budget vetoes Walker signed this summer.
Last year’s dividend
payment was a record $1.33 billion, which the governor’s office pointed out was
about $30,000,000 higher than what the state spent on
education. Were it not for the partial veto, individual PFD payments this year would have come to $2,052, for a total of $1.3 billion. The sum
exceeds what the state is projected to receive in revenue for the 2017 fiscal year, about $1.2 billion.
The Alaska Permanent Fund was initially created by
constitutional amendment in 1976, deriving from a quarter of all mineral lease rentals,
royalties, royalty sales proceeds, federal mineral
revenue-sharing payments and bonuses received by the state. Managed for the public by the APF Corporation, the fund
currently stands at $54.48 billion.
This year’s PFD cap
accompanied a list of items which were vetoed from the state’s 2017 budget.
Ultimately bringing the final budget down to $4.4 billion, Walker trimmed $1.29
billion from the draft legislators had put forward. $666,350,000 was cut from the PFD payout, with the undistributed amount to remain in its designated fund.
The next largest
savings to state spending was a veto on $430,000,000 of deposits into oil and gas tax credits, reductions to K-12 education by $58,335,600, cuts to agency budgets totaling $38,552,100, and another $95,000,000 reduced from higher education. Additional cuts to capital and miscellaneous project spending came to $21,502,000.
Speaking at a high school in Palmer, in his video address Walker explained his decision to cap the PFD as one of fiscal responsibility in light of a steep decline in revenues the state collects from its oil and gas royalties.
“Over the past
two years, Alaska has lost over 80 percent of our income, resulting in an over $4 billion budget deficit,” he said. “While my administration presented a complete fiscal plan to the Legislature last session, legislators did not pass a single
component of that plan. We cannot continue on our current path without making significant changes. If we do, the dividend program will be gone in just a few short years.”
Walker put the
year’s amount in perspective by comparing it to the dividend program’s average. Since its start in 1982, the average PFD check has come to about $1,100.
“This was an extremely difficult decision and one that I did not make lightly,” he said. “It was a necessary one, however, as the veto ensures the money will remain in the fund so checks will be available to future generations of Alaskans. This is about our children and grandchildren, and making sure we leave a strong and prosperous Alaska for them in the years to come.”
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