The alliance between Senate President Cathy Giessel and House Speaker Bryce Edgmon is as strong as ever but the two are extending an olive branch to Gov. Michael J. Dunleavy, asking him to come to the table and work on the future of the PFD.
In a letter sent on Thursday, the Legislature’s leadership asked the governor to consider calling a special session before the end of the year so legislators can sit down and consider changes to the Alaska Permanent Fund and the permanent fund dividend.
“We are proposing that a special session take place before the end of the 2019 calendar year to consider the issue. Furthermore, it is our wish to work collaboratively with your administration on the timing of the special session, the location and the need to ensure the broadest possible debate be facilitated relative to the critical nature of the issue under discussion,” explained the letter.
The letter sets out no strict criteria for such changes. The majority of the Legislature has so far pushed for a reduced dividend in order to balance the budget while Dunleavy and his allies have insisted that the state follows the decades-old formula that would pay a $3,000 dividend this year.
The gulf between the two plans—a surplus dividend and a $3,000 dividend—is a roughly $1 billion withdrawal from the Permanent Fund, which the majority of legislators fear would undercut the future of the fund’s ability to pay dividends and help fund government. Dunleavy and his allies argue that the money from previously reduced dividends could be put to this year’s payout and that the formula shouldn’t be changed without a vote of the people.
The Legislature earlier this year formed a bipartisan, bicameral Permanent Fund Working Group that produced reports on varying sizes of the dividend, including $3,000, $1,600 and roughly $900. The Legislature’s budget currently contains a $1,600 dividend that’s funded partly but the budget surplus and partly by withdrawals from savings.
The letter envisions that work would continue “to do the advance work necessary for the Legislature to meet its objective during the special session.” So far, the administration has been lightly involved in these meetings—the governor spoke directly to the members at their first substantive meeting—and the letter envisions the governor and his office would be closely involved in the discussions moving forward.
“We thank your administration for being able to work with the PFWG and hope the atmosphere of mutual collaboration can continue in the upcoming months,” they wrote.
So far, the Legislature has rejected proposals to add in the $1,400 between the currently proposed dividend and the $3,000 dividend, but it doesn’t appear to be out of the question. Some have floated the idea of tying the boosted dividend to a guarantee that revisions to the formula be approved.
One last big dividend, the supporters have asked.
What’s unclear is whether such a change would be put directly to voters.
Dunleavy has warned that any policy change could be hit with an voter-initiated referendum, which would give voters the opportunity to sound off on the dividend, but his idea of putting the matter to the voters would be through a constitutional amendment that would enshrine the dividend in the state constitution for all time.
Alaska voters created the Alaska Permanent Fund by a vote, but not the dividend.
According to a report by the Anchorage Daily News, the state has until Aug. 31 to determine this year’s dividend pay out. Changes made after that date could complicate the delivery of this year’s PFD.