Larry Persily

Larry Persily

Opinion: Revenues should be determined before more PFD spending

The governor believes the dividend drives the entire calculation. Sadly, he has it backwards

By Larry Persily

Once again, Alaska legislators have gaveled back into special session because Gov. Mike Dunleavy wants to show his constituents that he believes in one thing above all else: The largest Alaska Permanent Fund dividend in state history.

He’s like a wide-eyed kid in the candy shop, only he’s got a record-setting permanent fund balance jingling in his pockets and wants to spend some of it to buy chocolates for everyone in the state. Talk about a dangerous sweet tooth that can only decay the future growth potential of the state’s biggest savings account.

A long-term plan to pay for schools, the state ferries, fish and game management and all the other public services that Alaskans need to enjoy life and prosper — those are secondary niceties in the governor’s political road map to reelection in 2022. On his highway, arriving at a stable fiscal future for public services comes only after the dividend is protected in the constitution.

The governor believes the dividend drives the entire calculation. Sadly, he has it backwards. The forward-thinking approach would be to figure out recurring annual revenues and then decide on spending.

A dividend is a sweet nicety for many and, yes, essential for some families. But without dependable revenues to pay for solid public schools, a strong in-state university system and vocational training programs and other services, the benefits of an unaffordable short-term PFD are as lasting as a stretch of sunny weather in Southeast. You enjoy it, all the while knowing it is temporary. That’s no way to govern.

Rather than calling lawmakers back this week for their fourth special session of the year, telling them to keep working on a much larger dividend, the governor first should have offered specific, detailed legislative proposals for how the state can afford public services and a dividend with the trans-Alaska oil pipeline three-quarters empty.

Rather than setting up lawmakers to take the blame during the 2022 campaign for denying his super-size dividend, the governor should take a break from the magical fantasy tour of his $2,350 PFD and let lawmakers take a break from meeting. There’s no point in another special session. He does not have the votes and that’s not going to change no matter how many times he calls them back to the Capitol.

Dunleavy should accept reality: Most legislators don’t like his dividend-driven fiscal plan. That’s how checks and balances work between the equal branches of government. Unlike the dividend, that is in the constitution.

Larry Persily is a longtime Alaska journalist, with breaks for federal, state and municipal service in oil and gas, taxes and fiscal policy work. He is currently owner and editor of the weekly Wrangell Sentinel newspaper.

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