Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Permanent Fund topic
No spam. Unsubscribe anytime.
Lawmakers debate permanent fund draw rate and timing of governor’s tax bill after ISER report
Summary
Senators discussed a proposed 5% draw from the Permanent Fund and possible splits between dividends and government spending after an ISER presentation; some senators favored a lower draw (4.25–4.5%) and opposed enshrining the dividend in the constitution.
Lawmakers used the briefing to outline the debate over the governor’s tax and Permanent Fund proposals after a presentation from the Institute of Social and Economic Research (ISER).
President Stevens and others said they were impressed by the ISER study. "We were all impressed with the ISER study," Stevens said, noting ISER’s analysis of which revenue options affect Alaskans the most. Senator Wilkowski said ISER confirmed that measures such as using the Permanent Fund or instituting a broad sales tax would have large impacts on Alaskans, while corporate and oil tax adjustments tend to be less burdensome on households.
On the Permanent Fund, senators described competing priorities. Senator Stebbins said he supports consolidating the earnings reserve but prefers a lower draw than the governor’s proposed 5% and suggested a draw closer to 4.25–4.5% to preserve growth for future generations. "I personally would like to see it more at 4 and a half or maybe 4 and a quarter," he said, while acknowledging compromise may be necessary. He also said the dividend should not be enshrined in the constitution and warned that high fixed payout rates can be difficult to reverse, citing Sitka's earlier experience with a 6% payout.
Senator Giesel noted that Permanent Fund investment returns now make up a significant portion of the state's unrestricted general fund and that any change in draw policy bears directly on the state’s budget calculus. Lawmakers said a Department of Revenue fiscal-note presentation on the governor’s tax bill is scheduled for the Senate Resources Committee hearing this Friday, and they expected vigorous discussion in both bodies.
