04/21/2022 11:30 AM House WAYS & MEANS

                  HB 260-PFD: 50/50 POMV SPLIT                                                                              
                                                                                                                                
12:26:56 PM                                                                                                                   
                                                                                                                                
CHAIR SPOHNHOLZ announced that the  final order of business would                                                               
be HOUSE BILL NO.  260, "An Act relating to use  of income of the                                                               
Alaska permanent  fund; relating to  the amount of  the permanent                                                               
fund  dividend; relating  to the  duties of  the commissioner  of                                                               
revenue; and providing for an effective date."                                                                                  
                                                                                                                                
12:27:20 PM                                                                                                                   
                                                                                                                                
REPRESENTATIVE  LIZ  SNYDER,   Alaska  State  Legislature,  prime                                                               
sponsor of  HB 260, provided  a review of the  bill's provisions.                                                               
She  stated  that HB  260  is  designed  to reflect  the  diverse                                                               
priorities  that are  heard when  talking about  the PFD  and the                                                               
budget as a whole.   She said the bill is  also designed to meet,                                                               
or be  consistent with, all  the bullet  points that came  out of                                                               
the Fiscal  [Policy] Working  Group.  She  specified that  HB 260                                                               
would  require the  5 percent  POMV draw,  would begin  with flat                                                               
funding the budget  based on a five-year moving  average, and the                                                               
remaining  funds  would be  directed  towards  a  PFD with  a  50                                                               
percent split  as the attainable  target.  So, she  continued, it                                                               
could be called a conditional  PFD 50/50 split or an aspirational                                                               
50/50 split.   Representative Snyder advised that  nothing in the                                                               
bill would direct  issues around revenue generation  or cuts, but                                                               
if  the legislature  decided  to  do either  of  those, it  would                                                               
affect  the  resulting  calculations  and  affect  the  five-year                                                               
moving  average.   She related  that using  the moving  five-year                                                               
average would  reduce the  ability for the  PFD to  be weaponized                                                               
because any  change in the PFD  in a given year  is not reflected                                                               
in  the resulting  budget until  the  following year  when it  is                                                               
incorporated into the five-year moving average.                                                                                 
                                                                                                                                
CHAIR SPOHNHOLZ opened public testimony on HB 260.                                                                              
                                                                                                                                
12:29:43 PM                                                                                                                   
                                                                                                                                
ED MARTIN  testified in  opposition to  HB 260.   He  stated that                                                               
something is wrong when the only  growing revenue to the State of                                                               
Alaska  is from  the  permanent  fund and  its  investments.   He                                                               
maintained  that  the  state  would be  much  farther  ahead  had                                                               
traditional  revenue instead  been  coming in,  plus there  would                                                               
then  not be  the contentious  issue of  whether the  legislature                                                               
should or  should not follow the  law and pay the  full statutory                                                               
formula.    He  said  the  state  has  failed  miserably  by  not                                                               
selecting the lands  still owed to it and passing  those lands on                                                               
for settlement.   He urged that HB  260 not be passed  and to pay                                                               
the permanent fund dividend [according to] original statute.                                                                    
                                                                                                                                
12:33:10 PM                                                                                                                   
                                                                                                                                
ADAM HYKES testified  in opposition to HB 260.   He said whenever                                                               
he  sees  a new  bill  about  the  permanent fund  dividend  that                                                               
changes the  statutory words "corporation shall  transfer" to the                                                               
words "legislature  shall appropriate" he knows  the bill follows                                                               
the agenda of  reducing the people's PFD in favor  of filling the                                                               
budget gaps where  legislators have failed to do so.   He said he                                                               
disagrees with the assumption that  the holes in the state budget                                                               
require  taking money  out  of  the pockets  of  Alaskans.   Fund                                                               
education as the constitution demands,  he stated, but the PFD is                                                               
falsely roped  into this  conversation time and  time again.   He                                                               
argued that right now there is  even less of a reason to conflate                                                               
these  two  issues given  the  recent  spike  in oil  prices  and                                                               
therefore less of a budget gap to  fill.  He maintained it is the                                                               
legislature's  job to  figure out  how to  fill the  gaps in  the                                                               
budget while preserving the traditional PFD.                                                                                    
                                                                                                                                
12:35:25 PM                                                                                                                   
                                                                                                                                
REPRESENTATIVE SPOHNHOLZ closed public  testimony on HB 260 after                                                               
ascertaining that no one else wished to testify.                                                                                
                                                                                                                                
[HB 260 was held over.]