1999-02-10                     House Journal                      Page 0192
HB 89                                                                        
HOUSE BILL NO. 89 by the House Rules Committee by request of                   
the Governor, entitled:                                                        
                                                                               
"An Act authorizing an advisory vote on the use of the Alaska                 
permanent fund earnings reserve account; relating to certain                   
procedures for the special election; and providing for an effective            
date."                                                                         
                                                                               
was read the first time and referred to the State Affairs and Finance          
Committees.                                                                    
                                                                               
The following fiscal notes apply:                                              
                                                                               
Fiscal notes (2), Office of the Governor, 2/10/99                              
                                                                               
                                                                               
The Governor's transmittal letter dated February 9, 1999, appears              
below:                                                                         
                                                                               
"Dear Speaker Porter:                                                          
                                                                               
This bill is a key part of the Alaska Balanced Budget Plan I am                
submitting today.  It calls for an advisory vote to be held June 1 of          
this year on the question of whether the legislature should appropriate        
$4 billion dollars from the Earnings Reserve Account (ERA) of the              
Permanent Fund to the Constitutional Budget Reserve (CBR).                     
                                                                               
I have also introduced a bill to appropriate $4 billion dollars to provide     
sustainable revenue for a balanced budget.  The effective date of that         
bill is tied to approval of the transfer in a statewide advisory vote.         
                                                                               

1999-02-10                     House Journal                      Page 0193
HB 89                                                                        
I have long stated that no changes in the Permanent Fund should occur          
without a vote of the people.  A one-time transfer from the ERA,               
although not affecting the principal of the Permanent Fund, would              
impact future earnings of the Fund.  Dividends would decrease                  
modestly over the next five years before rising again.  Therefore, I           
believe this proposal should be reviewed and voted on by the public.           
                                                                               
We must hold this special election prior to the next fiscal year if we         
are to take advantage of the booming stock market and help achieve             
a balanced budget within 18 months.  It is imperative the legislature          
authorize this election expeditiously to ensure sufficient lead-time for       
the election review by the United States Department of Justice and             
setting up the election structure.  I urge your prompt consideration.          
                                                                               
							Sincerely,                                                              
							/s/                                                                     
							Tony Knowles                                                            
							Governor"