Governor Bill Walker’s proposal to use the permanent fund as an endowment got its first hearing by the Senate State Affairs Committee Tuesday.
Walker defends the plan as a key piece in reversing Alaska’s fiscal crisis; saying with as the state spends $400,000 from savings each hour, in coming years legislators may be forced to spend from the permanent fund to cover the budget gap.
Walker: “Well we want to make the permanent fund permanent, if there’s no change whatsoever, the permanent fund goes to zero in four years. So we want to make sure that doesn’t happen. We also want to make sure that there’s a good educational system, there’s a good public safety system, we have a good transportation system. That we have the Alaska that we want, that we’ve gotten to know over the last few years but we have to make some adjustments to make sure, that it might not be exactly what it was in the past, but it will be sustainable.”
On Tuesday, Chair Bill Stolze of the Senate State Affairs Committee introduced several ideas surrounding the use of Alaska’s Permanent Fund earnings as a way to pay for state government.
Senator Stoltze says one idea would be to amend the constitution to allow voters to weigh in. He has not introduced a bill with that idea however.
The governor’s plan to use permanent fund earnings would also change how the annual PFD checks to Alaskans are calculated.
One question raised is whether the permanent fund’s earnings reserve account would have to be cleared in order to repay the amount of money taken last year from the constitutional reserve account.
It would not, according to the Department of Law.