Governor Walker’s administration unveiled the first part of their plan to bridge the budget gap on Wednesday. The plan would convert the Permanent Fund into an endowment-like fund that would take in oil income and generate annual revenue for the state. The changes would protect the state from the highs and lows of oil prices.
The part of the change that is likely to cause the most debate is that the Permanent Fund Dividend would be reduced to approximately $1,000. The average over the past 10 years has been $1,400. Eligible Alaskans would still receive a check, but it would not be at the same levels seen in the past few years.
The endowment model is not a new concept for the Permanent Fund and there are legislators who have suggested similar plans as a way to help bridge the funding gap for the state. One thing that legislators seem to agree on is that it will take time to go through the Governor’s plan and understand the details.