{"id":47601,"date":"2019-05-08T03:00:00","date_gmt":"2019-05-08T11:00:00","guid":{"rendered":"https:\/\/www.juneauempire.com\/opinion\/opinion-paying-a-dividend-alaska-can-afford\/"},"modified":"2019-05-08T03:00:00","modified_gmt":"2019-05-08T11:00:00","slug":"opinion-paying-a-dividend-alaska-can-afford","status":"publish","type":"post","link":"https:\/\/www.juneauempire.com\/opinion\/opinion-paying-a-dividend-alaska-can-afford\/","title":{"rendered":"Opinion: Paying a dividend Alaska can afford"},"content":{"rendered":"

During last Wednesday’s Senate floor debate on the state budget<\/a>, I offered an amendment to reduce this year’s Permanent Fund Dividend from the proposed $3,000 to a more reasonable $1,200 per Alaskan. My reasoning was simple and practical: a $1,200 PFD is one Alaska can afford.<\/p>\n

It’s a matter of simple math. A $3,000 dividend leaves a gaping $1.2 billion deficit, while a $1,200 dividend would balance the budget and allow funding of core state services at sensibly reduced levels — all while providing a reasonably-sized dividend more in line with the PFDs Alaskans have received in the past.<\/p>\n

A $1,200 dividend also keeps a promise the Legislature made to Alaskans just last year.<\/p>\n

With the passage of Senate Bill 26, we restructured the way Permanent Fund earnings are fundamentally managed and placed into law a fixed annual transfer of roughly 5 percent from the fund to the state treasury.<\/p>\n

[Opinion: A public vote on the PFD is worse than doing nothing]<\/a><\/ins><\/p>\n

The goal was simple: protect the $65 billion Permanent Fund itself while creating a sustainable, long-term revenue stream — one that allows for a healthy PFD and helps pay for core state services like education, public safety and infrastructure.<\/p>\n

But by putting the state on course for a $1.2 billion deficit, a $3,000 dividend is anything but healthy. We have three basic options to close the budget gap created by a $3,000 dividend:<\/p>\n

1. Cut another $1.2 billion from the budget. While I strongly support continued downward pressure on the budget, we need to continue making sensible, managed, multi-year reductions so we don’t send the state’s economy into a tailspin or cut core services too deeply.<\/p>\n

2. Raise $1.2 billion in new revenue, which means either doubling oil and gas taxes or levying a hefty new income and\/or sales tax on Alaskans. But to me it doesn’t make sense to torpedo the oil and gas industry with a massive tax increase or to tax Alaskans heavily with one hand just to send out a big dividend with the other.<\/p>\n

[Opinion: A change in Alaska’s crime laws is needed now]<\/a><\/ins><\/p>\n

3. Pull $1.2 billion from our dwindling cash reserves, which means either wiping out most of what remains of the state savings account or drawing from the Permanent Fund Earnings Reserve, a move that will reduce future dividends and our ability to fund core services down the road.<\/p>\n

Option three — a $1.2 billion draw from the earnings reserve — appears to be the course plotted by the budget just sent to the House for concurrence. This move prioritizes a super-sized PFD this year over safeguarding a reasonable dividend for future generations and providing funding for schools, law enforcement, roads and other essential state services for years to come.<\/p>\n

The good news is that the budget is not yet finalized. The differences between the House and Senate versions of the budget — including the size of the PFD — will now get worked out in a conference committee.<\/p>\n

My hope is that a budget that considers the long game will prevail and a balance will be found between reasonable budget cuts, preserving state savings accounts and paying a dividend Alaska can afford.<\/p>\n

\n

\u2022 Sen. Chris Birch is a Republican who represents South Anchorage\/Lower Hillside in the Alaska State Legislature. My Turns and Letters to the Editor represent the view of the author, not the view of the Juneau Empire.<\/ins><\/b><\/p>\n

\n","protected":false},"excerpt":{"rendered":"

Lower PFD would balance budget, allow funding of core services. <\/p>\n","protected":false},"author":106,"featured_media":47602,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_stopmodifiedupdate":false,"_modified_date":"","wds_primary_category":8,"footnotes":""},"categories":[8],"tags":[],"yst_prominent_words":[],"class_list":["post-47601","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-opinion"],"_links":{"self":[{"href":"https:\/\/www.juneauempire.com\/wp-json\/wp\/v2\/posts\/47601","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.juneauempire.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.juneauempire.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.juneauempire.com\/wp-json\/wp\/v2\/users\/106"}],"replies":[{"embeddable":true,"href":"https:\/\/www.juneauempire.com\/wp-json\/wp\/v2\/comments?post=47601"}],"version-history":[{"count":0,"href":"https:\/\/www.juneauempire.com\/wp-json\/wp\/v2\/posts\/47601\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.juneauempire.com\/wp-json\/wp\/v2\/media\/47602"}],"wp:attachment":[{"href":"https:\/\/www.juneauempire.com\/wp-json\/wp\/v2\/media?parent=47601"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.juneauempire.com\/wp-json\/wp\/v2\/categories?post=47601"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.juneauempire.com\/wp-json\/wp\/v2\/tags?post=47601"},{"taxonomy":"yst_prominent_words","embeddable":true,"href":"https:\/\/www.juneauempire.com\/wp-json\/wp\/v2\/yst_prominent_words?post=47601"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}