In a pair of landmark votes Tuesday, the Alaska Legislature agreed to harness the Alaska Permanent Fund to the needs of state government.
In separate actions, the Alaska House and Alaska Senate approved a compromise version of Senate Bill 26, a measure that allows the Legislature to spend up to 5.25 percent of the fund’s average five-year value.
That average drops to 5 percent in 2021.
This year, that will amount to $2.7 billion transferred from the Permanent Fund: $1.7 billion to partially offset the state’s $2.4 billion deficit, and $1 billion for the Alaska Permanent Fund Dividend.
Some lawmakers hailed the bill as a grand compromise fulfilling the 40-year vision of former Gov. Jay Hammond, who said his vision for the Permanent Fund was to “transform oil wells pumping oil for a finite period into money wells pumping money for infinity.”
“I think we’ve done an incredible amount to close almost 80 percent of Alaska’s budget (deficit) should both bodies agree to the bill,” said Sen. Anna MacKinnon, R-Eagle River and the lead Senate negotiator on the bill.
Others lambasted the measure for failing to adequately protect the dividend and for lacking the binding power to do what its text says it will do.
“I think this is the beginning of the end of the Permanent Fund Dividend,” said Rep. Scott Kawasaki, D-Fairbanks.
In either case, SB 26 now goes to Gov. Bill Walker.