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SB 26: "An Act relating to the Alaska Permanent Fund Corporation, the earnings of the Alaska permanent fund, and the earnings reserve account; relating to the mental health trust fund; relating to deposits into the dividend fund; relating to the calculation of permanent fund dividends; relating to unrestricted state revenue available for appropriation; and providing for an effective date."

00                             SENATE BILL NO. 26                                                                          
01 "An Act relating to the Alaska Permanent Fund Corporation, the earnings of the Alaska                                   
02 permanent fund, and the earnings reserve account; relating to the mental health trust                                   
03 fund; relating to deposits into the dividend fund; relating to the calculation of                                       
04 permanent fund dividends; relating to unrestricted state revenue available for                                          
05 appropriation; and providing for an effective date."                                                                    
06 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                                
07    * Section 1. The uncodified law of the State of Alaska is amended by adding a new section                          
08 to read:                                                                                                                
09       LEGISLATIVE INTENT. It is the intent of the legislature that the legislature                                      
10 reevaluate the use of earnings of the Alaska permanent fund, as prescribed under this Act, in                           
11 three years.                                                                                                            
12    * Sec. 2. AS 37.13.010(a) is amended to read:                                                                      
13            (a)  Under art. IX, sec. 15, of the state constitution, there is established as a                            
01       separate fund the Alaska permanent fund. The Alaska permanent fund consists of                                    
02 (1)  25 percent of all mineral lease rentals, royalties, royalty sale                                                   
03 proceeds, net profit shares under AS 38.05.180(f) and (g), and federal mineral revenue                                  
04 sharing payments received by the state from mineral leases [ISSUED ON OR                                                
05 BEFORE DECEMBER 1, 1979,] and 25 percent of all bonuses received by the state                                           
06       from mineral leases [ISSUED ON OR BEFORE FEBRUARY 15, 1980;                                                       
07 (2)  50 PERCENT OF ALL MINERAL LEASE RENTALS,                                                                           
08 ROYALTIES, ROYALTY SALE PROCEEDS, NET PROFIT SHARES UNDER                                                               
09 AS 38.05.180(f) AND (g), AND FEDERAL MINERAL REVENUE SHARING                                                            
10 PAYMENTS RECEIVED BY THE STATE FROM MINERAL LEASES ISSUED                                                               
11 AFTER DECEMBER 1, 1979, AND 50 PERCENT OF ALL BONUSES RECEIVED                                                          
12 BY THE STATE FROM MINERAL LEASES ISSUED AFTER FEBRUARY 15,                                                              
13       1980]; and                                                                                                        
14 (2) [(3)]  any other money appropriated to or otherwise allocated by                                                
15       law or former law to the Alaska permanent fund.                                                                   
16    * Sec. 3. AS 37.13.140 is amended to read:                                                                         
17 Sec. 37.13.140. Income. Net income of the fund includes income of the                                                 
18 earnings reserve account established under AS 37.13.145. The corporation shall                                      
19 determine the net [NET] income of the fund [SHALL BE COMPUTED                                                       
20 ANNUALLY AS OF THE LAST DAY OF THE FISCAL YEAR] in accordance with                                                      
21 generally accepted accounting principles, excluding any unrealized gains or losses.                                     
22 [INCOME AVAILABLE FOR DISTRIBUTION EQUALS 21 PERCENT OF THE                                                             
23 NET INCOME OF THE FUND FOR THE LAST FIVE FISCAL YEARS,                                                                  
24 INCLUDING THE FISCAL YEAR JUST ENDED, BUT MAY NOT EXCEED NET                                                            
25 INCOME OF THE FUND FOR THE FISCAL YEAR JUST ENDED PLUS THE                                                              
26 BALANCE IN THE EARNINGS RESERVE ACCOUNT DESCRIBED IN                                                                    
27       AS 37.13.145.]                                                                                                    
28    * Sec. 4. AS 37.13.140 is amended by adding new subsections to read:                                               
29 (b)  The corporation shall determine the amount available for distribution each                                         
30 year. The amount available for distribution equals five and one-quarter percent of the                                  
31 average market value of the fund for the first five of the preceding six fiscal years,                                  
01 including the fiscal year just ended, computed annually for each fiscal year in                                         
02 accordance with generally accepted accounting principles. In this subsection, "the                                      
03 average market value of the fund" includes the balance of the earnings reserve account                                  
04 established under AS 37.13.145, but does not include that portion of the principal                                      
05 attributed to the settlement of State v. Amerada Hess, et al., 1JU-77-847 Civ.                                          
06       (Superior Court, First Judicial District).                                                                        
07 (c)  In accordance with AS 37.13.146(a)(1), and subject to appropriation, 20                                            
08 percent of the amount available for distribution under (b) of this section shall be                                     
09 reserved for dividends. The remainder of the amount available for distribution under                                    
10 (b) of this section shall be reduced by the difference between the amount calculated                                    
11 under (1) of this subsection and the amount under (2) of this subsection if the amount                                  
12 calculated under (1) of this subsection exceeds the amount under (2) of this                                            
13       subsection:                                                                                                       
14 (1)  the total amount of oil and gas production taxes under                                                             
15 AS 43.55.011 - 43.55.180, mineral lease rentals, royalties, royalty sale proceeds, net                                  
16 profit shares under AS 38.05.180(f) and (g), and federal mineral revenue sharing                                        
17 payments and bonuses received by the state from mineral leases that are deposited into                                  
18       the general fund in the current fiscal year, less the amount under AS 37.13.146(a)(2);                            
19                 (2)  the sum of $1,200,000,000.                                                                         
20    * Sec. 5. AS 37.13.145(d) is amended to read:                                                                      
21 (d)  Income [NOTWITHSTANDING (b) OF THIS SECTION, INCOME]                                                           
22 earned on money awarded in or received as a result of State v. Amerada Hess, et al.,                                    
23 1JU-77-847 Civ. (Superior Court, First Judicial District), including settlement,                                        
24 summary judgment, or adjustment to a royalty-in-kind contract that is tied to the                                       
25 outcome of this case, or interest earned on the money, or on the earnings of the money                                  
26 shall be treated in the same manner as other income of the Alaska permanent fund,                                       
27 except that it is not available for distribution [TO THE DIVIDEND FUND OR FOR                                           
28 TRANSFERS TO THE PRINCIPAL] under AS 37.13.140(b) and (c) [OF THIS                                                  
29 SECTION], and shall be annually deposited into the Alaska capital income fund                                           
30       (AS 37.05.565).                                                                                                   
31    * Sec. 6. AS 37.13.145 is amended by adding new subsections to read:                                               
01            (e)  Each year the legislature may appropriate from the earnings reserve                                     
02       account to the general fund an amount that does not exceed the amount available for                               
03       distribution under AS 37.13.140(b) and (c).                                                                       
04 (f)  Each year the legislature may appropriate from the earnings reserve                                                
05 account to the principal of the fund an amount by which the balance of the earnings                                     
06 reserve account exceeds the amount available for distribution under AS 37.13.140(b)                                     
07       multiplied by four, less the amount appropriated under (e) of this section.                                       
08    * Sec. 7. AS 37.13 is amended by adding new sections to read:                                                      
09            Sec. 37.13.146. Appropriations to the dividend fund. (a) The legislature may                               
10 appropriate to the dividend fund established in AS 43.23.045 the following amounts                                      
11       from the general fund:                                                                                            
12                 (1)  20 percent of the amount calculated under AS 37.13.140(b); and                                     
13 (2)  an amount equal to 20 percent of the money deposited in the                                                        
14 general fund during the fiscal year just ended from all mineral lease rentals, royalties,                               
15 royalty sale proceeds, net profit shares under AS 38.05.180(f) and (g), federal mineral                                 
16       revenue sharing payments, and bonuses received by the state from mineral leases.                                  
17            (b)  Nothing in this section creates a dedicated fund.                                                       
18    * Sec. 8. AS 37.13.300(c) is amended to read:                                                                      
19 (c)  Net income from the mental health trust fund may not be included in the                                            
20 computation of [NET] income available for distribution under AS 37.13.140(b)                                        
21       [AS 37.13.140].                                                                                                   
22    * Sec. 9. AS 43.23.025(a) is amended to read:                                                                      
23 (a)  By October 1 of each year, the commissioner shall determine the value of                                           
24       each permanent fund dividend for that year by                                                                     
25 (1)  determining the total amount available for dividend payments,                                                      
26       which equals                                                                                                      
27 (A)  the amount appropriated [OF INCOME OF THE                                                                      
28 ALASKA PERMANENT FUND TRANSFERRED] to the dividend fund                                                                 
29            under AS 37.13.146 [AS 37.13.145(b)] during the current year;                                            
30 (B)  plus the unexpended and unobligated balances of prior                                                              
31 fiscal year appropriations that lapse into the dividend fund under                                                      
01            AS 43.23.045(d);                                                                                             
02                      (C)  less the amount necessary to pay prior year dividends from                                    
03            the dividend fund in the current year under AS 43.23.005(h), 43.23.021, and                                  
04            43.23.055(3) and (7);                                                                                        
05 (D)  less the amount necessary to pay dividends from the                                                                
06 dividend fund due to eligible applicants who, as determined by the department,                                          
07 filed for a previous year's dividend by the filing deadline but who were not                                            
08            included in a previous year's dividend computation;                                                          
09                      (E)  less appropriations from the dividend fund during the                                         
10 current year, including amounts to pay costs of administering the dividend                                              
11            program and the hold harmless provisions of AS 43.23.075;                                                    
12 (2)  determining the number of individuals eligible to receive a                                                        
13 dividend payment for the current year and the number of estates and successors                                          
14 eligible to receive a dividend payment for the current year under AS 43.23.005(h); and                                  
15 (3)  dividing the amount determined under (1) of this subsection by the                                                 
16       amount determined under (2) of this subsection.                                                                   
17    * Sec. 10. AS 43.23.025 is amended by adding a new subsection to read:                                             
18 (c)  Notwithstanding (a) of this section, the amount of each permanent fund                                             
19       dividend for fiscal years 2018 and 2019 shall be $1,000.                                                          
20    * Sec. 11. AS 43.23.045(a) is amended to read:                                                                     
21 (a)  The dividend fund is established as a separate fund in the state treasury.                                         
22 The fund consists of money appropriated to it under AS 37.13.146. The dividend                                      
23 fund shall be administered by the commissioner and shall be invested by the                                             
24       commissioner in the same manner as provided in AS 37.10.070.                                                      
25    * Sec. 12. AS 43.23.055 is amended to read:                                                                        
26            Sec. 43.23.055. Duties of the department. The department shall                                             
27 (1)  annually pay permanent fund dividends from the dividend fund,                                                  
28       without further appropriation;                                                                                
29 (2)  subject to AS 43.23.011 and paragraph (8) of this section, adopt                                                   
30 regulations under AS 44.62 (Administrative Procedure Act) that establish procedures                                     
31 and time limits for claiming a permanent fund dividend; the department shall                                            
01 determine the number of eligible applicants by October 1 of the year for which the                                      
02       dividend is declared and pay the dividends by December 31 of that year;                                           
03 (3)  adopt regulations under AS 44.62 (Administrative Procedure Act)                                                    
04 that establish procedures and time limits for an individual upon emancipation or upon                                   
05 reaching majority to apply for permanent fund dividends not received during minority                                    
06 because the parent, guardian, or other authorized representative did not apply on                                       
07       behalf of the individual;                                                                                         
08 (4)  assist residents of the state, particularly in rural areas, who because                                            
09 of language, disability, or inaccessibility to public transportation need assistance to                                 
10       establish eligibility and to apply for permanent fund dividends;                                                  
11 (5)  use a list of individuals ineligible for a dividend under                                                          
12 AS 43.23.005(d) provided annually by the Department of Corrections and the                                              
13 Department of Public Safety to determine the number and identity of those                                               
14       individuals;                                                                                                      
15 (6)  adopt regulations that are necessary to implement AS 43.23.005(d);                                                 
16 (7)  adopt regulations that establish procedures for the parent, guardian,                                              
17 or other authorized representative of a disabled individual to apply for prior year                                     
18 permanent fund dividends not received by the disabled individual because no                                             
19       application was submitted on behalf of the individual;                                                            
20 (8)  adopt regulations that establish procedures for an individual to                                                   
21 apply to have a dividend disbursement under AS 37.25.050(a)(2) reissued if it is not                                    
22 collected within two years after the date of its issuance; however, the department may                                  
23 not establish a time limit within which an application to have a disbursement reissued                                  
24       must be filed;                                                                                                    
25 (9)  provide any information, upon request, contained in permanent                                                      
26 fund dividend records to the child support services agency created in AS 25.27.010, or                                  
27 the child support enforcement agency of another state, for child support purposes                                       
28 authorized under law; if the information is contained in an electronic data base, the                                   
29       department shall provide the requesting agency with either                                                        
30                      (A)  access to the data base; or                                                                   
31 (B)  a copy of the information in the data base and a statement                                                         
01            certifying its contents;                                                                                     
02                 (10)  establish a fraud investigation unit for the purpose of assisting the                             
03                      (A)  Department of Law in the prosecution of individuals who                                       
04 apply for or obtain a permanent fund dividend in violation of a provision in                                            
05            AS 11, by detecting and investigating those crimes; and                                                      
06 (B)  commissioner to detect and investigate the claiming or                                                             
07 paying of permanent fund dividends that should not have been claimed by or                                              
08 paid to an individual and to impose the penalties and enforcement provisions                                            
09            under AS 43.23.035.                                                                                          
10    * Sec. 13. AS 37.10.430(c); AS 37.13.145(b), and 37.13.145(c) are repealed.                                      
11    * Sec. 14. AS 43.23.025(c) is repealed June 30, 2020.                                                              
12    * Sec. 15. This Act takes effect immediately under AS 01.10.070(c).