Why Alaska's Senate President is not keen on using savings for a $3,000 PFD
Gov. Mike Dunleavy is calling for a nearly $3,000 Permanent Fund dividend next year, and he's asking the Legislature for state savings to pay for it. The idea doesn't sit well with Senate President Cathy Giessel, who says the move would whittle down what she calls the state's last savings account.
"Should we institute an income tax, even a statewide sales tax, for the sole purpose of paying a very large dividend?" Giessel said. "Or, should we modernize, update that calculation that figures out what the dividend is to meet today's needs?"
For his part Gov. Mike Dunleavy says the move is necessary to comply with current law. He is also calling for a supplemental PFD payment of $1,400 to fill the gap between this year's PFD payment and the statutory sum that was not paid — which would require separate legislation.
“Until those statutes are changed, modified in some form or fashion we continue to view the PFD as a transfer to the people of Alaska," Dunleavy said at a press conference earlier this month.
Giessel notes that if the governor's plan were approved by lawmakers, Alaska would risk dipping into the red.
"We've had huge fires this last year. We have a big bill that's still sitting there that needs to be paid for those," Giessel noted.
She explained, "I believe that the Constitutional Budget Reserve, that savings account, needs to be kept, at that $2 billion mark to meet all of those budget demands that can crop up."
In a press release following the announcement of the governor's plan, House Finance Committee co-chair, Jennifer Johnston agreed.
"It would be reckless to drain our primary savings account for the largest PFD in history," Johnston wrote.
Lawmakers will gavel into session again on Jan. 21.
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