Legislature(2023 - 2024)
2023-05-01 Senate Journal
Full Journal pdf2023-05-01 Senate Journal Page 0914 SB 107 CS FOR SENATE BILL NO. 107(FIN) "An Act relating to the Alaska permanent fund; relating to income of the Alaska permanent fund; relating to the amount available for appropriation and appropriations from the earnings reserve account; relating to the permanent fund dividend; and providing for an effective date" was read the third time. Senator Hughes moved and asked unanimous consent the bill be returned to second reading for amendments. Without objection, the bill was returned to second reading. Senator Hughes offered Amendment No. 1 : Page 1, following line 5: Insert a new bill section to read: "* Section 1. The uncodified law of the State of Alaska is amended by adding a new section to read: LEGISLATIVE INTENT. It is the intent of the legislature to (1) implement the recommendations of the 2021 Comprehensive Fiscal Plan Working Group; (2) harmonize the calculation under AS 37.13.140(a) of net income available for distribution and net income available for appropriation under AS 37.13.140(b); 2023-05-01 Senate Journal Page 0915 (3) temporarily change the mechanism used to draw money from the earnings reserve account to leverage the unprecedented earnings currently available in the account, so that the legislature has adequate time to debate, analyze, and implement the revenue measures and cost reductions required for the long-term financial stability of the state; (4) reverse the changes made by this Act if the recommendations of the 2021 Comprehensive Fiscal Plan Working Group are not adopted and implemented in their entirety." Page 1, line 6: Delete "Section 1" Insert "Sec. 2" Renumber the following bill sections accordingly. Page 2, lines 13 - 26: Delete all material and insert: "* Sec. 3. AS 37.13.140, as amended by sec. 2 of this Act, is amended to read: Sec. 37.13.140. Income. (a) Net income of the fund includes income of the earnings reserve account established under AS 37.13.145. Net income of the fund shall be computed annually as of the last day of the fiscal year in accordance with generally accepted accounting principles, excluding any unrealized gains or losses. Income available for distribution equals 21 percent of the net income of the fund for the last five fiscal years, including the fiscal year just ended, but may not exceed net income of the fund for the fiscal year just ended plus the balance in the earnings reserve account described in AS 37.13.145. (b) The corporation shall determine the amount available for appropriation each year. The amount available for appropriation is five percent of the average market value of the fund for the first five of the preceding six fiscal years, including the fiscal year just ended, computed annually for each fiscal year in accordance with generally accepted accounting principles. [THE AMOUNT AVAILABLE FOR APPROPRIATION MAY NOT EXCEED THE BALANCE IN THE EARNINGS RESERVE ACCOUNT 2023-05-01 Senate Journal Page 0916 DESCRIBED IN AS 37.13.145.] In this subsection, "average market value of the fund" includes the balance of the earnings reserve account established under AS 37.13.145, but does not include that portion of the principal attributed to the settlement of State v. Amerada Hess, et al., 1JU-77-847 Civ. (Superior Court, First Judicial District). * Sec. 4. AS 37.13.145(b) is amended to read: (b) Each [AT THE END OF EACH] fiscal year, the legislature may appropriate [CORPORATION SHALL TRANSFER] from the earnings reserve account to the (1) dividend fund established under AS 43.23.045, not less than 50 percent of the amount [INCOME] available for appropriation [DISTRIBUTION] under AS 37.13.140(b); and (2) general fund, up to 50 percent of the amount available for appropriation under AS 37.13.140(b) [AS 37.13.140]. * Sec. 5. AS 37.13.145(b), as amended by sec. 4 of this Act, is amended to read: (b) At the end of each [EACH] fiscal year, the corporation shall transfer [LEGISLATURE MAY APPROPRIATE] from the earnings reserve account to the [(1)] dividend fund established under AS 43.23.045, [NOT LESS THAN] 50 percent of the income [AMOUNT] available for distribution [APPROPRIATION] under AS 37.13.140 [AS 37.13.140(b); AND (2) GENERAL FUND, UP TO 50 PERCENT OF THE AMOUNT AVAILABLE FOR APPROPRIATION UNDER AS 37.13.140(b)]." Renumber the following bill sections accordingly. Page 3, following line 14: Insert a new bill section to read: "* Sec. 7. AS 37.13.145(c), as amended by sec. 6 of this Act, is amended to read: (c) After the transfer [APPROPRIATIONS] under (b) and an appropriation under (g) of this section, the corporation shall transfer [LEGISLATURE MAY APPROPRIATE] from the earnings reserve account to the principal of the fund an amount sufficient to offset the effect of inflation on the principal of the 2023-05-01 Senate Journal Page 0917 fund during that fiscal year. However, none of the amount transferred [APPROPRIATED] shall be applied to increase the value of that portion of the principal attributed to the settlement of State v. Amerada Hess, et al., 1JU-77-847 Civ. (Superior Court, First Judicial District) on July 1, 2004. The corporation shall calculate the amount to transfer [APPROPRIATE] to the principal under this subsection by (1) computing the average of the monthly United States Consumer Price Index for all urban consumers for each of the two previous calendar years; (2) computing the percentage change between the first and second calendar year average; and (3) applying that rate to the value of the principal of the fund on the last day of the fiscal year just ended, including that portion of the principal attributed to the settlement of State v. Amerada Hess, et al., 1JU-77-847 Civ. (Superior Court, First Judicial District)." Renumber the following bill sections accordingly. Page 3, line 22: Delete "general fund or the" Page 3, line 23: Delete "(b) of this section or [,] for an appropriation [" Insert "AS 37.13.140(b) or [, FOR" Page 3, following line 26: Insert new bill sections to read: "* Sec. 9. AS 37.13.145(d), as amended by sec. 8 of this Act, is amended to read: (d) Notwithstanding (b) of this section, income earned on money awarded in or received as a result of State v. Amerada Hess, et al., 1JU-77-847 Civ. (Superior Court, First Judicial District), including settlement, summary judgment, or adjustment to a royalty-in-kind contract that is tied to the outcome of this case, or interest earned on the money, or on the earnings of the money shall be treated in the same manner as other income of the Alaska permanent fund, except that it is not available for distribution [APPROPRIATION] to the dividend fund, for 2023-05-01 Senate Journal Page 0918 transfers [UNDER AS 37.13.140(b) OR] to the principal under (c) of this section, or for an appropriation under (g) of this section, and shall be annually deposited into the Alaska capital income fund (AS 37.05.565). * Sec. 10. AS 37.13.145 is amended by adding new subsections to read: (g) The legislature may not appropriate from the earnings reserve account to the general fund a total amount that exceeds the amount available for appropriation under AS 37.13.140(b) in a fiscal year. (h) The combined total of the transfer under (b) of this section and an appropriation under (g) of this section may not exceed the amount available for appropriation under AS 37.13.140(b)." Renumber the following bill sections accordingly. Page 3, following line 30: Insert a new bill section to read: "* Sec. 12. AS 37.13.300(c), as amended by sec. 11 of this Act, is amended to read: (c) Net income from the mental health trust fund may not be included in the computation of net income or market value [THE AMOUNT] available for distribution or appropriation under AS 37.13.140 [AS 37.13.140(b)]." Renumber the following bill sections accordingly. Page 4, following line 25: Insert a new bill section to read: "* Sec. 14. AS 43.23.025(a), as amended by sec. 13 of this Act, is amended to read: (a) By October 1 of each year, the commissioner shall determine the value of each permanent fund dividend for that year by (1) determining the total amount available for dividend payments, which equals (A) the amount of income of the Alaska permanent fund transferred [APPROPRIATED] to the dividend fund under AS 37.13.145(b) during the current year; 2023-05-01 Senate Journal Page 0919 (B) plus the unexpended and unobligated balances of prior fiscal year appropriations that lapse into the dividend fund under AS 43.23.045(d); (C) less the amount necessary to pay prior year dividends from the dividend fund in the current year under AS 43.23.005(h), 43.23.021, and 43.23.055(3) and (7); (D) less the amount necessary to pay dividends from the dividend fund due to eligible applicants who, as determined by the department, filed for a previous year's dividend by the filing deadline but who were not included in a previous year's dividend computation; (E) less appropriations from the dividend fund during the current year, including amounts to pay costs of administering the dividend program and the hold harmless provisions of AS 43.23.240; (2) determining the number of individuals eligible to receive a dividend payment for the current year and the number of estates and successors eligible to receive a dividend payment for the current year under AS 43.23.005(h); and (3) dividing the amount determined under (1) of this subsection by the amount determined under (2) of this subsection." Renumber the following bill sections accordingly. Page 4, line 27, through page 6, line 7: Delete all material and insert: "* Sec. 16. The uncodified law of the State of Alaska is amended by adding a new section to read: USE OF THE EARNINGS RESERVE ACCOUNT. For the fiscal years ending June 30, 2023, and June 30, 2024, in addition to the amount available for appropriation calculated under AS 37.13.140(b), the legislature may appropriate from the earnings reserve account to the general fund an additional 1.5 percent of the average market value of the fund for the first five of the preceding six fiscal years, including the fiscal year just ended, computed annually for each fiscal year in accordance with generally accepted accounting principles. In this section, "average market value of the fund" has the meaning given in AS 37.13.140(b). 2023-05-01 Senate Journal Page 0920 * Sec. 17. The uncodified law of the State of Alaska is amended by adding a new section to read: CONDITIONAL EFFECT. (a) Sections 3, 5, 7, 9, 10, 12, and 14 of this Act take effect unless, by November 30, 2024, (1) the voters have approved a resolution that appears on a statewide election ballot that amends the Constitution of the State of Alaska to (A) specify that the amount that may be appropriated from the Alaska permanent fund is a draw based on the average fiscal-year-end market value of the permanent fund; (B) require deposit of the unencumbered balance of the earnings reserve account established under AS 37.13.145 into the Alaska permanent fund to become part of the principal of the fund; (C) require that an annual permanent fund dividend be paid in an amount determined by a formula in statute; and (D) require that an amendment to the statute setting out the formula of the amount of the permanent fund dividend be approved by the voters before taking effect; (2) revenue laws anticipated to generate at least an estimated $500,000,000 of new revenue each year have been passed by the Thirty-Third Alaska State Legislature and enacted into law; and (3) the legislature passes a resolution proposing an amendment to art. IX, sec. 16, Constitution of the State of Alaska, amending the appropriation limit and adjusting the appropriation limit by an economic indicator. (b) The commissioner of revenue shall notify the revisor of statutes of whether, before November 30, 2024, revenue laws anticipated to generate at least an estimated $500,000,000 of new revenue each year have been passed by the Thirty-Third Alaska State Legislature and enacted into law. * Sec. 18. If, under sec. 17 of this Act, secs. 3, 5, 7, 9, 10, 12, and 14 of this Act take effect, they take effect July 1, 2025. * Sec. 19. Except as provided in sec. 18 of this Act, this Act takes effect immediately under AS 01.10.070(c)." Senator Hughes moved for the adoption of Amendment No. 1. Senator Stedman objected. 2023-05-01 Senate Journal Page 0921 The question being: "Shall Amendment No. 1 be adopted?" The roll was taken with the following result: CSSB 107(FIN) Second Reading Amendment No. 1? YEAS: 3 NAYS: 16 EXCUSED: 1 ABSENT: 0 Yeas: Hughes, Myers, Shower Nays: Bishop, Bjorkman, Claman, Dunbar, Giessel, Gray-Jackson, Hoffman, Kaufman, Kiehl, Merrick, Olson, Stedman, Stevens, Tobin, Wielechowski, Wilson Excused: Kawasaki and so, Amendment No. 1 failed. Senator Myers offered Amendment No. 2 : Page 4, line 29, following "if": Insert "the condition in sec. 10 of this Act is met and" Page 5, following line 27: Insert a new bill section to read: "* Sec. 10. The uncodified law of the State of Alaska is amended by adding a new section to read: CONDITIONAL EFFECT. Sections 1 - 9 and 11 of this Act take effect only if, by July 1, 2024, a version of CSSB 52(EDC) or a similar bill increasing the base student allocation has been passed by the Thirty-Third Alaska State Legislature." Renumber the following bill sections accordingly. Page 6, line 7: Delete all material and insert: "* Sec. 12. If secs. 1, 2, 4 - 9, and 11 of this Act take effect, they take effect July 1, 2024." Senator Myers moved for the adoption of Amendment No. 2. Senator Stedman objected. 2023-05-01 Senate Journal Page 0922 The question being: "Shall Amendment No. 2 be adopted?" The roll was taken with the following result: CSSB 107(FIN) Second Reading Amendment No. 2? YEAS: 3 NAYS: 16 EXCUSED: 1 ABSENT: 0 Yeas: Hughes, Myers, Shower Nays: Bishop, Bjorkman, Claman, Dunbar, Giessel, Gray-Jackson, Hoffman, Kaufman, Kiehl, Merrick, Olson, Stedman, Stevens, Tobin, Wielechowski, Wilson Excused: Kawasaki and so, Amendment No. 2 failed. Senator Myers offered Amendment No. 3 : Page 2, lines 21 - 26: Delete all material. Renumber the following bill sections accordingly. Page 4, line 27, through page 6, line 7: Delete all material and insert: "* Sec. 8. This Act takes effect July 1, 2025." Senator Myers moved for the adoption of Amendment No. 3. Senator Stedman objected. The question being: "Shall Amendment No. 3 be adopted?" The roll was taken with the following result: CSSB 107(FIN) Second Reading Amendment No. 3? 2023-05-01 Senate Journal Page 0923 YEAS: 3 NAYS: 15 EXCUSED: 1 ABSENT: 1 Yeas: Hughes, Myers, Shower Nays: Bishop, Bjorkman, Claman, Dunbar, Giessel, Gray-Jackson, Hoffman, Kaufman, Merrick, Olson, Stedman, Stevens, Tobin, Wielechowski, Wilson Excused: Kawasaki Absent: Kiehl and so, Amendment No. 3 failed. Senator Myers offered Amendment No. 4 : Page 1, line 3, following "dividend;": Insert "authorizing an advisory vote on this Act;" Page 4, following line 26: Insert a new bill section to read: "* Sec. 9. The uncodified law of the State of Alaska is amended by adding a new section to read: ADVISORY VOTE. The lieutenant governor shall place before the qualified voters of the state at the next general election a question to the legislature and the governor. Notwithstanding AS 15.80.005 and other laws relating to preparation of the ballot proposition, the question shall appear on the ballot in the following form: Q U E S T I O N Do you approve of the enactment of SB 107? Yes [ ] No [ ]" Renumber the following bill sections accordingly. Page 4, line 29, following "if": Insert "the condition in sec. 11 of this Act is met and" Page 5, following line 27: Insert a new bill section to read: "* Sec. 11. The uncodified law of the State of Alaska is amended by adding a new section to read: CONDITIONAL EFFECT. Sections 1 - 8 and 10 of this Act 2023-05-01 Senate Journal Page 0924 take effect only if, by November 30, 2024, a majority of voters have answered in the affirmative to the question described in sec. 9 of this Act." Renumber the following bill sections accordingly. Page 5, line 30: Delete "sec. 9" Insert "sec. 10" Page 6, line 6: Delete "sec. 9(b)(2)" Insert "sec. 10(b)(2)" Page 6, line 7: Delete all material and insert: "* Sec. 13. If secs. 1, 2, and 4 - 10 of this Act take effect, they take effect July 1, 2025." Senator Myers moved for the adoption of Amendment No. 4. Senator Stedman objected. The question being: "Shall Amendment No. 4 be adopted?" The roll was taken with the following result: CSSB 107(FIN) Second Reading Amendment No. 4? YEAS: 3 NAYS: 16 EXCUSED: 1 ABSENT: 0 Yeas: Hughes, Myers, Shower Nays: Bishop, Bjorkman, Claman, Dunbar, Giessel, Gray-Jackson, Hoffman, Kaufman, Kiehl, Merrick, Olson, Stedman, Stevens, Tobin, Wielechowski, Wilson Excused: Kawasaki and so, Amendment No. 4 failed. 2023-05-01 Senate Journal Page 0925 CS FOR SENATE BILL NO. 107(FIN) was automatically in third reading. The question being: "Shall CS FOR SENATE BILL NO. 107(FIN) "An Act relating to the Alaska permanent fund; relating to income of the Alaska permanent fund; relating to the amount available for appropriation and appropriations from the earnings reserve account; relating to the permanent fund dividend; and providing for an effective date" pass the Senate?" The roll was taken with the following result: CSSB 107(FIN) Third Reading - Final Passage YEAS: 12 NAYS: 7 EXCUSED: 1 ABSENT: 0 Yeas: Bishop, Bjorkman, Giessel, Gray-Jackson, Hoffman, Kaufman, Kiehl, Merrick, Olson, Stedman, Stevens, Tobin Nays: Claman, Dunbar, Hughes, Myers, Shower, Wielechowski, Wilson Excused: Kawasaki and so, CS FOR SENATE BILL NO. 107(FIN) passed the Senate. Senator Giessel moved for the adoption of the effective date clause(s). The question being: "Shall the effective date clause(s) be adopted?" The roll was taken with the following result: CSSB 107(FIN) Effective Date Clause(s) YEAS: 17 NAYS: 1 EXCUSED: 1 ABSENT: 1 Yeas: Bishop, Bjorkman, Claman, Dunbar, Giessel, Gray-Jackson, Hoffman, Kaufman, Kiehl, Merrick, Myers, Olson, Stedman, Stevens, Tobin, Wielechowski, Wilson Nays: Hughes Excused: Kawasaki Absent: Shower and so, the effective date clause(s) were adopted. 2023-05-01 Senate Journal Page 0926 Senator Hoffman gave notice of reconsideration on CS FOR SENATE BILL NO. 107(FIN) and moved and asked unanimous consent it be taken up. Without objection, it was so ordered and the bill was before the Senate on reconsideration. The question to be reconsidered: "Shall CS FOR SENATE BILL NO. 107(FIN) "An Act relating to the Alaska permanent fund; relating to income of the Alaska permanent fund; relating to the amount available for appropriation and appropriations from the earnings reserve account; relating to the permanent fund dividend; and providing for an effective date" pass the Senate?" The roll was taken with the following result: CSSB 107(FIN) Third Reading - On Reconsideration YEAS: 12 NAYS: 7 EXCUSED: 1 ABSENT: 0 Yeas: Bishop, Bjorkman, Giessel, Gray-Jackson, Hoffman, Kaufman, Kiehl, Merrick, Olson, Stedman, Stevens, Tobin Nays: Claman, Dunbar, Hughes, Myers, Shower, Wielechowski, Wilson Excused: Kawasaki and so, CS FOR SENATE BILL NO. 107(FIN) passed the Senate on reconsideration. Senator Giessel moved for the adoption of the effective date clause(s). The question being: "Shall the effective date clause(s) be adopted?" The roll was taken with the following result: 2023-05-01 Senate Journal Page 0927 CSSB 107(FIN) Effective Date Clause(s) YEAS: 16 NAYS: 3 EXCUSED: 1 ABSENT: 0 Yeas: Bishop, Bjorkman, Claman, Dunbar, Giessel, Gray-Jackson, Hoffman, Kaufman, Kiehl, Merrick, Olson, Stedman, Stevens, Tobin, Wielechowski, Wilson Nays: Hughes, Myers, Shower Excused: Kawasaki and so, the effective date clause(s) were adopted and the bill was referred to the Secretary for engrossment.