Sen. Anna MacKinnon
Republican, District G
State Capitol Room 516
Juneau AK, 99801
Alaska State Legislature
Rep. Neal Foster
Democrat, District 39
State Capitol Room 410
Juneau AK, 99801
For Immediate Release: May 2, 2018
Statement on Senate Bill 26 Conference Committee
JUNEAU — The joint Senate and House Conference Committee today released a new version of Senate Bill 26 that may provide a compromise to resolving the state’s fiscal problems. The draft bill is the product of significant negotiations between the House and the Senate.
The conference committee was appointed to find agreement after the House and Senate approved different versions of Senate Bill 26 last year.
The new draft bill limits the amount of money legislators may withdraw each year from the Permanent Fund’s Earnings Reserve Account. The structured draw in the bill will support the Alaska Permanent Fund Corporation in making prudent investment decisions, providing the necessary tools to maintain a healthy fund and dividend program. The draft does not address how the money will be spent and does not change existing law governing the dividend.
Specifically, the conference committee work draft:
- Limits, for three years, an annual draw the Permanent Fund Corporation has testified is sustainable – 5.25% (effective rate of 4.35% in 2019) of the five-year rolling average of Permanent Fund’s value. After three years, the draw decreases to 5%;
- Removes the statutory split and annual dividend amount in previous versions of SB 26;
- Maintains the statutory dividend calculation in existing law;
- Conforms statute to a recent Alaska Supreme Court decision.
Sen. Anna MacKinnon released the following statement:
“Transitioning to a structured, rules-based withdrawal mechanism to allow some Permanent Fund earnings to help support state government and essential services is widely acknowledged to be the single most important action we can take to resolve our state fiscal problems. This action alone will solve more than 80 percent of our deficit.”
Rep. Neal Foster released the following statement:
“This work draft does not change, in any way, the existing law governing the Permanent Fund dividend. The bill focuses instead on one key change: using an endowment model to protect the Permanent Fund and future dividends.”
For more information, contact Senate Majority Press Secretary Daniel McDonald at (907) 465-4066.