Institute of the North launching a broad and diverse coalition to address fiscal future of the Permanent Fund
As the state prepares to work on the budget and set new policy during this year’s Legislative session, Alaskans are joining together in a new coalition that will seek to keep Alaska’s Permanent Fund sustainable. The Institute of the North, a nonprofit focused on policy in Alaska’s Arctic, is launching a statewide coalition to address the long-term sustainability of the Permanent Fund.
This year, the state is planning to spend down the Permanent Fund, a unique savings account where state natural resource revenues are built up for Alaska’s future. It’s also the account responsible for the Permanent Fund Dividend. Spending down the fund will have significant and enduring consequences for Alaska’s future, including higher taxes, service cuts and reduction, and elimination of PFD checks, Institute of the North Executive Director, Ian Laing said. “I’ve been around politics for a long time, and it’s very rare that collectively, as a state, we find ourselves at a juncture that is this critical,” Laing said. More than $17 billion of the fund has been used since 2013. As the fund is depleted, so are its annual earnings, $850 million per year — enough to cover last year’s entire PFD payment, “in perpetuity,” a January press release from the Institute of the North said.
As an organization, Institute of the North is focused on a concept called the commons, Laing said, with the mission of getting the most value out of the resources we all share.
“We’ve been in this struggle for seven years now,” Laing said. “We’ve spent down two major savings accounts, but what we’re right on the verge of doing is philosophically different.”
Laing said the coalition is less concerned with how the Permanent Fund money is divided up for services or dividends. He said the coalition is solely interested in the sustainability of the entire fund.
Sustainability of the fund is something most Alaskans can agree on, so the fund can be available to future generations. This goal of sustainability will be “undermined” without a constitutional amendment to protect the fund’s value, which has been the policy recommendation of the Permanent Fund Board of Trustees for over 20 years, according to the press release. Multiple Legislators and Gov. Mike Dunleavy have put forth their own bills for constitutional amendments.
The vision for the coalition is to build a broad and diverse group of Alaskans to weigh in at this crucial time, and share those thoughts with lawmakers, who could put an amendment before the voters next year that would treat the fund more like a traditional endowment. An endowment structure could provide for limited spending, while still allowing the fund to grow.
“The default fiscal plan of this state -- the things we have been doing in the past -- is to spend down one of the greatest assets this state has,” Laing said. “It’s a complicated discussion. But it is 100% the most important decision we can make right now. Because I can guarantee, if we miss this opportunity and we do not protect this fund now, we will look back with regret and shame.” Any Alaskans or organizations who are interested in weighing in or being a part of the coalition, can reach out to Ian Laing at [email protected].
