Alaska State Legislature

News From The Senate and House Majorities

Ken Freemen, House Majority Press Secretary
Phone: (907)465-3804
Wendy Lindskoog, Senate Majority Press Secretary
(907)465-4582
State Capitol
Juneau, AK 99801
Actuality line: 1-800-478-6540
http://www.akrepublicans.org

For Immediate Release: February 26, 1997, Contact: Senator Lyda Green, 907/465-6600 or Representative Alan Austerman, 907/465-2487

Let the People Guard The Permanent Fund

Resolutions Introduced To Protect Permanent Fund Dividends and Earnings

Juneau -- Senator Lyda Green (R-Mat-Su) and Representative Alan Austerman (R-Kodiak) introduced companion resolutions Wednesday calling for a constitutional amendment to require a vote of the people before changing the Permanent Fund.

"Let the people guard their Permanent Fund," Green said. "These resolutions ask for only one change to the existing Permanent Fund system -- that the people vote to accept or reject changes proposed for using the earnings of the Permanent Fund."

"It is appropriate we introduce these measures today as Alaska celebrates the 20th Anniversary of the first deposit of dedicated oil revenues in the Permanent Fund which took place on February 26, 1977," said Austerman.

"Most Alaska citizens do not know that under current law, their dividend program could be eliminated by a simple majority vote of the Legislature and approval by the Governor," Austerman explained. "Through this legislation, we are placing the future of the Permanent fund in the hands of the people, not government."

"If adopted, this amendment will permanently protect dividends, guarantee inflation-proofing and require voter approval for spending undistributed income from the Permanent Fund earnings reserve," said Green.

Under the constitution (Art. IX, Sec. 15) all net income from the Permanent Fund is deposited in the general fund and available for appropriation. However, the Legislature, by statute, has created an earnings reserve account to hold this net income from which dividends and inflation-proofing are paid. Whatever funds are leftover in the earnings reserve after inflation-proofing and paying dividends are called "undistributed income".

"By permanently protecting dividends and inflation-proofing, and requiring voter approval for spending surplus income, I feel Alaskans might be more comfortable about considering and approving by a vote, other uses for undistributed income in the earnings reserve account that will benefit our state," Green said.

"I expect this resolution will receive strong support from Governor Knowles. After all, the Governor announced in both his State of the State and State of the Budget addresses, that there would be no threat to the dividends and no spending without a vote of the people. That is precisely what this amendment seeks to ensure," said Green.

These resolutions will lay to rest any question that dividends are in danger, that inflation-proofing might be sacrificed, or that spending of the earnings of the permanent fund might happen without a vote of the people.

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