PFD vote takes another option off the table

  • By Peninsula Clarion Editorial
  • Thursday, June 15, 2017 7:47pm
  • Opinion

We’d call it one step forward and two steps back, except we’re not sure there was a step forward in the first place.

On Wednesday, the Alaska House of Representatives voted to undo any progress being made toward a solution to the state’s fiscal woes by increasing the Permanent Fund Dividend to $2,200. Many House members — 26 of them, to be exact — have come to the conclusion that a long-term fiscal plan isn’t going to happen this session, and are abandoning their earlier measure to cap dividends at $1,250 and use some of the Permanent Fund’s earnings to pay for state government.

While the House’s action would also need to approved by the Senate and signed by Gov. Bill Walker — who, don’t forget, vetoed half the funding the Legislature had allocated for dividends in a failed effort to force lawmakers to come up with a solution last year — should Alaskans actually find themselves the recipients of a $2,200 PFD, we’d offer this advice: put it in the bank and make it last as long as possible, because you’re not going to see one like it again.

If lawmakers decide they’re hopelessly deadlocked, they can, with a two-thirds vote, draw on the Constitutional Budget Reserve for one more year to cover the cost of state government.

Then it’s all but gone, and the only pot of money big enough to cover a $3 billion hole will be the Permanent Fund earnings reserve — the same account from which money to pay dividends is allocated.

The Senate’s version of the budget also would use Permanent Fund earnings and does have a deficit, but if the Constitutional Budget Reserve is gone, that means either a greater draw on Permanent Fund earnings — and therefore, an even smaller dividend — or even deeper cuts to state services, which so many people advocate for but so few seem to be able to come up with ones we can live with.

The House plan includes an income tax, which the Senate will not pass. If the House continues to push that idea, we will find ourselves in the same position next year — with no Constitutional Budget Reserve to draw on — and again, we’ll be looking at the Permanent Fund earnings to cover the cost of government.

Both bodies agree that restructuring Permanent Fund to use earnings to pay for government is the biggest and most crucial part of fixing Alaska’s revenue stream. Yet, with the special session called by Gov. Walker ending today, it appears that we are no closer — not even one step — toward a solution.

So, when that check hits your bank account next fall, however big it is, savor it, because the current Legislature is leaving future ones with no other options.

More in Opinion

Opinion: Rural broadband is essential infrastructure

Broadband funding is available. The rest is up to Alaskans.

Nurse Sherra Pritchard gives Madyson Knudsen a bandage at the Kenai Public Health Center after the 10-year-old received her first COVID-19 vaccine on Friday, Nov. 5, 2021. (Camille Botello/Peninsula Clarion)
Alaska Voices: A mom’s and pediatrician’s perspective on COVID-19 vaccines for children

I want to see children and their parents who have yet to get vaccinated roll up their sleeves.

Larry Persily (Peninsula Clarion file)
Opinion: State defends its right to cut nonexistent taxes

This from a state that has no property tax on homes or businesses, only on the oil industry.

Gavel (Courtesy photo)
Opinion: The foolish men claiming self-defense

It’s not just misguided teenagers carrying guns who find themselves in trouble with the law.

Dr. Jay Butler, former chief medical officer for the State of Alaska, is seen in this undated photo. (Courtesy photo)
Alaska Voices: Feeling grateful this Thanksgiving for the COVID vaccines

The COVID vaccines remain our strongest tool in combating the pandemic and helping us return to our lives and the things we love and cherish.

A resident casts their vote in the regular municipal election Tuesday, Oct. 6, 2020 at the Kenai Peninsula Fairgrounds in Ninilchik, Alaska. (Photo by Megan Pacer/Homer News)
Voices of the Peninsula: All votes matter

In the beginning, only property-holding white men could vote.

Cristen San Roman. (Photo provided)
Point of View: Is management of Cook Inlet catered to special interest groups?

If these fish are so at risk, why is BOEM able to move forward with lease sale 258?

Homer Foundation
Point of View: Grateful for the hidden ‘good’

Gratitude: Noun The state of being grateful; thankfulness. The state or quality… Continue reading

Homer High School Principal Douglas Waclawski. (Photo provided)
Point of View: What is Homer High School about?

What I consider Homer High’s strength is that we are a place for learning.

UAA Chancellor Sean Parnell. (courtesy photo)
Alaska Voices: Invent your future at UAA

At UAA we’re providing the tools to help students of all ages and skills chart a new course forward.

A registered nurse prepares a COVID-19 vaccine at the pop-up clinic on the Spit on May 27. (Photo by Sarah Knapp/Homer News)
Alaska Voices: Vaccination is the still best protection from COVID-19

The Alaska State Medical Association encourages you to protect yourselves and your community from preventable illness by getting recommended vaccines.

(Ben Hohenstatt / Juneau Empire File)
The sad diminishment of Rep. Don Young

Young seems afraid to demand his party leader defend the dignity of the institution he loves.