Eligible Alaskans will receive $2,072 for the 2015 Permanent Fund Dividend, the largest payout in the fund’s history.
The payout surpasses the $2,000 mark for only the second time in the fund’s more than 30-year history, and is almost 200 dollars more than last year’s $1,884 dividend.
Governor Bill Walker, moments before 12-year-old Wasilla student Shania Sommer officially unveiled the PFD amount, said this year’s dividend is remarkable for another reason: it comes at a time when Alaska’s state government faces billion-dollar deficits.
“We’re in a very unique situation this year,” Walker said before the big announcement.
“It’s the first time in Alaska’s history that the earnings from the Permanent Fund have exceeded the earnings from oil. This payout will be higher than the cost of education in Alaska, K-12 … so we’re in a bit of dilemma this year, given that with the price of oil, half our income went away, and we’re in about a $3 billion deficit.”
The governor said that the irony is seeing the state paying out more than a billion dollars to the roughly 630,000 eligible PFD applicants, at a time when budget cuts have laid off firefighters in McGrath, canceled ferry service in the southeast, and mothballed large infrastructure projects statewide.
Walker said he’ll go to the legislature this year with a plan for balancing Alaska’s budget. But Lieutenant Governor Byron Mallott—himself a former trustee and executive director of the Permanent Fund Dividend Corporation, which overseas the fund’s investments—described the account as Alaska’s “rainy day” fund.
That rainy day, Mallott said, may have come.
“The Permanent Fund was created to take some portion of Alaska’s one-time revenues at the start of Prudhoe Bay, and put those revenues into a status, into an account, into a fund … The clarity of those who founded the fund, that ultimately the purpose of the fund was to help meet Alaska’s fiscal needs, its state revenue needs, when the rainy day occurred, when we needed to begin replacing non-renewable oil wealth with renewable financial wealth, that time is now.”
Without adjusting for inflation, this year’s PFD payout of $2,072 is the largest in the fund’s history. In 2008, under Gov. Sarah Palin, the state announced a $2,069 PFD, which came with an additional $1,200 “resource rebate.”
The Alaska PFD has been given out every year since 1982. The first PFD was an even $1,000. When adjusted for inflation the 1-thousand dollars in 1982 works out to nearly $2,470 in 2015 dollars.
Alaska voters established the Permanent Fund in 1976 through a constitutional amendment. A few years later the dividend fund was established, with equal payouts set for all Alaska residents for a “share in a portion of the State minerals revenue.”
Now valued at more than $50 billion, the PFD payout is based on an average of the interest earned on the fund’s past five years of investments.