Legislature(2023 - 2024)DAVIS 106

03/11/2023 09:00 AM House WAYS & MEANS

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Please Note Time Change --
+ Presentations: TELECONFERENCED
- Responsible Alaska Budget and Spending Limits
by Quinn Townsend, Policy Manager, Alaska Policy
<Above Item Removed from Agenda>
- Spending Caps by Rob Carpenter, Deputy
Director, Legislative Finance
<Above Item Removed from Agenda>
<Bill Hearing Canceled>
<Bill Hearing Canceled>
+ Bills Previously Heard/Scheduled TELECONFERENCED
Heard & Held
-- Public Testimony <Time Limit May Be Set> --
Heard & Held
-- Public Testimony <Time Limit May Be Set> --
Heard & Held
-- Public Testimony <Time Limit May Be Set> --
Heard & Held
-- Public Testimony <Time Limit May Be Set> --
Heard & Held
+ "An Act on the Permanent Fund Dividend" TELECONFERENCED
<Pending Introduction & Referral>
<Above Item Removed from Agenda>
         HJR  9-CONST AM: PERMANENT FUND; POMV;EARNINGS                                                                     
9:03:10 AM                                                                                                                    
REPRESENTATIVE MCCABE announced that  the first order of business                                                               
would be HOUSE  JOINT RESOLUTION NO. 9,  "Proposing amendments to                                                               
the Constitution  of the State  of Alaska relating to  the Alaska                                                               
permanent fund  and to appropriations  from the  Alaska permanent                                                               
REPRESENTATIVE  MCCABE  announced  to  members that  he  will  be                                                               
chairing today's meeting until the arrival of Chair Carpenter.                                                                  
9:04:08 AM                                                                                                                    
The committee took an at-ease from 9:04 a.m. to 9:05 a.m.                                                                       
9:05:27 AM                                                                                                                    
REPRESENTATIVE GROH, as prime sponsor  of HJR 9, gave the sponsor                                                               
statement  to the  committee [included  in the  committee packet]                                                               
which read as follows [original punctuations provided]:                                                                         
     When the Permanent Fund was  created, it was structured                                                                    
     as  two  accounts:  the   Principal  and  the  Earnings                                                                    
     Reserve   Account   (ERA).  The   Alaska   Constitution                                                                    
     prohibits the spending of the  Principal without a vote                                                                    
     of the  people. However, profits generated  by the fund                                                                    
     are  deposited   into  the   ERA,  which   is  entirely                                                                    
     available  for  the   Legislature  to  appropriate  and                                                                    
     spend. The  current value of  the ERA  is approximately                                                                    
     $16 billion. Overdraw of the  ERA depletes the value of                                                                    
     the entire Permanent Fund and  leaves Alaska worse off.                                                                    
     In  2018 the  Legislature adopted  statutes that  allow                                                                    
     appropriation  up  to  an  amount  that  maintains  the                                                                    
     growth of the fund. This  plan is commonly known as the                                                                    
     "Percent of  Market Value" ("POMV") draw.  Still, those                                                                    
     statutes  do  not  stop the  Legislature  from  passing                                                                    
     budgets that spend Permanent  Fund earnings beyond than                                                                    
     those sustainable limits. This  resolution would send a                                                                    
     proposed amendment  to Alaska  voters to  enshrine this                                                                    
     policy    in    the    constitution.    The    proposed                                                                    
     constitutional  amendment would  combine the  Permanent                                                                    
     Fund Principal and the  Permanent Fund Earnings Reserve                                                                    
     Account  into   a  single   constitutionally  protected                                                                    
     account.   Under    this   proposed    amendment,   the                                                                    
     Legislature would  be allowed to appropriate  each year                                                                    
     a maximum of  five percent (5%) of the  market value of                                                                    
     that  new   constitutionally  safeguarded   account  as                                                                    
     calculated  over the  first five  of the  preceding six                                                                    
     fiscal years.  Experts have  told the  Legislature that                                                                    
     these limits  make that spending rate  sustainable. The                                                                    
     Permanent  Fund's Board  of  Trustees have  recommended                                                                    
     this  change   since  2003,  and   this  constitutional                                                                    
     amendment was  also urged by the  Fiscal Policy Working                                                                    
     Group, a bipartisan and  bicameral group of legislators                                                                    
     that issued a  report in 2021. This measure  is not and                                                                    
     should not  deal with  the size  of the  Permanent Fund                                                                    
     Dividend   or   what   specific  percentage   of   this                                                                    
     appropriation is  spent on  state services.  It neither                                                                    
     encourages  nor  prevents   legislators  from  pursuing                                                                    
     those  plans in  the future.  This merely  prevents the                                                                    
     state   from  overspending   our  renewable   financial                                                                    
     resource which ensures the  permanence of our Permanent                                                                    
9:08:31 AM                                                                                                                    
CAMERON EBERSOLD, Staff, Representative  Cliff Groh, Alaska State                                                               
Legislature,  explained that  Section 1  would amend  Article IX,                                                               
Section 15(a)  of the  Alaska State  Constitution so  that income                                                               
earned  by the  Alaska permanent  fund would  be retained  by the                                                               
fund's  sole account  created by  Section 3.   He  said the  only                                                               
exceptions are detailed  in Section 2.  He said  Section 2 amends                                                               
Article IX, Sect. 15 with  two subsections.  Subsection (b) would                                                               
allow the legislature,  in each fiscal year,  to appropriate from                                                               
the fund only up to 5 percent  of the average market value of the                                                               
fund over the  preceding six fiscal years.   Subsection (c) would                                                               
allow the permanent fund to be  used to pay costs associated with                                                               
investments.  He explained that  Section 3 would amend Article XV                                                               
with  a  new section:  Section  30.    This section  proposes  to                                                               
deposit the  balance of the  earnings reserve account  (ERA) into                                                               
the  principal,  unifying  the   permanent  fund  into  a  single                                                               
account.  It  also specifies the proposed  amendments would apply                                                               
to appropriations  made during  the fiscal  year ending  June 30,                                                               
2026, and after.  He said  Section 4 would place these amendments                                                               
before state voters at the next General Election.                                                                               
9:10:05 AM                                                                                                                    
REPRESENTATIVE MCKAY asked how the  state would pay dividends out                                                               
of the fund, prescribed in HJR 9, if it were to pass.                                                                           
REPRESENTATIVE GROH explained  that the payouts would  be done in                                                               
the  same way  as the  legislature has  been doing  currently, in                                                               
that   the  legislature   votes,   through   powers  granted   in                                                               
Wielechowski  v. State.    He  said HJR  9  does  not attempt  to                                                               
address the  permanent fund dividend  (PFD), which is  a separate                                                               
issue.   He said the measures  have been heard, and  there may be                                                               
others to hear that would address  the PFD level.  He stated that                                                               
while many  legislators do  not see eye-to-eye  on the  exact PFD                                                               
level, HJR  9 seeks to  provide fiscal stability and  prevent the                                                               
legislature from  overspending.  He  proposed HJR  9 as a  way to                                                               
protect the permanent fund from overdraws in the future.                                                                        
9:11:47 AM                                                                                                                    
REPRESENTATIVE  MCKAY  suggested  that  the total  value  of  the                                                               
permanent fund corpus is about $76 billion.                                                                                     
REPRESENTATIVE  GROH remarked,  "It changes  month to  month, but                                                               
REPRESENTATIVE   MCKAY   referred   to   Representatives   Groh's                                                               
materials  and offered  his understanding  that they  stated that                                                               
the ERA is at about $16 billion.                                                                                                
REPRESENTATIVE GROH clarified  that it is more  than $13 billion;                                                               
the $16 billion figure was from last year's financial report.                                                                   
REPRESENTATIVE  MCKAY suggested  that,  if the  corpus total  was                                                               
added to  the ERA, is about  $90 billion altogether.   Further, 5                                                               
percent of that figure would be about $4.5 billion.                                                                             
REPRESENTATIVE GROH  stated that he would  defer percentage draws                                                               
figures  to David  Mitchell,  CEO of  the  Alaska Permanent  Fund                                                               
Corporation.   He reiterated that  the value of the  fund changes                                                               
from month to month, and even day to day.                                                                                       
9:13:33 AM                                                                                                                    
REPRESENTATIVE MCCABE asked about language  within page 1 line 15                                                               
and 16.  He said he it is  unusual to see language, like the word                                                               
"may", in a constitutional amendment.   For example, "Each fiscal                                                               
year the legislature  may appropriate from the  permanent fund to                                                               
the general fund an amount that is  not more than 5 percent".  He                                                               
said that the  language does not really prescribe 5  percent.  He                                                               
stressed that  this is not  what the fiscal policy  working group                                                               
said,  and instead  had said  that  the constitutional  amendment                                                               
would state  "shall," as in "the  legislature shall appropriate".                                                               
He asked if the language is intentional.                                                                                        
9:15:02 AM                                                                                                                    
EMILY NAUMAN,  Director, Legislative Legal  Services, Legislative                                                               
Affairs  Agency, answered  that the  discussion between  "may" or                                                               
"shall"  is a  policy  decision.   She  said that  Representative                                                               
McCabe  is  correct  that  stating   that  the  legislature  "may                                                               
appropriate not more than 5  percent" would allow the legislature                                                               
to appropriate  nothing or up to  5 percent.  She  suggested that                                                               
there  might be  policy reasons  behind why  a legislature  would                                                               
want to draw less than 5 percent off of the fund.                                                                               
9:15:44 AM                                                                                                                    
REPRESENTATIVE ALLARD asked Ms. Nauman  to give the committee the                                                               
legal  difference, in  legal  use, between  the  words "may"  and                                                               
MS. NAUMAN answered  that "may" is permissive, in  that it allows                                                               
the  legislature  to  do  something.    Moreover,  "shall"  is  a                                                               
requirement, in  that it  would require  the legislature  to take                                                               
certain action.                                                                                                                 
9:16:24 AM                                                                                                                    
REPRESENTATIVE GROH  urged the  committee to  support HJR  9, and                                                               
said  the  changes  that  the   joint  resolution  proposes  were                                                               
recommendations from  the Fiscal Policy  Working Group.   He said                                                               
the intent of  the bill was to  address, if there are  draws at 5                                                               
percent,  whether  the legislature  wants  to  maintain the  fund                                                               
sustainably in the future.                                                                                                      
9:17:24 AM                                                                                                                    
REPRESENTATIVE  ALLARD  pointed out  that  using  the word  "may"                                                               
allows the  legislature to "do  what they  want."  She  asked the                                                               
bill sponsor why he drafted the bill with the word "may".                                                                       
REPRESENTATIVE GROH  replied that  the intent was  to have  the 5                                                               
percent  be  a  firm  cap,  and allows  for  the  legislature  to                                                               
spending below or up to 5 percent.   He deferred to Ms. Nauman to                                                               
further address the question.                                                                                                   
9:18:24 AM                                                                                                                    
MS.  NAUMAN  answered  that the  definition  Representative  Groh                                                               
provided  is  correct,  in  that the  language  would  allow  the                                                               
legislature to  draw up to 5  percent each year if  it so wishes.                                                               
She said the bill allows for draws under 5 percent.                                                                             
REPRESENTATIVE  ALLARD  stated   that  she  wants  Representative                                                               
Groh's opinion  on the language  used in HJR  9.  She  said that,                                                               
for  her, using  the word  "may" does  not provide  confidence to                                                               
Alaska, as using the word "shall" would.                                                                                        
REPRESENTATIVE GROH  reiterated that the legal  interpretation of                                                               
the word "may" means the legislature  could draw up to or below 5                                                               
percent.    He said  this  language  carries  out the  policy  of                                                               
allowing  legislative appropriations  from the  fund of  up to  5                                                               
9:19:57 AM                                                                                                                    
REPRESENTATIVE MCCABE  asked if the  intent is  to just have  a 5                                                               
percent cap.                                                                                                                    
REPRESENTATIVE GROH answered that is correct.                                                                                   
9:20:11 AM                                                                                                                    
MR.  EBERSOLD  addressed   Representative  Allard's  question  by                                                               
explaining  that the  amount of  the  PFD is  different from  the                                                               
appropriation  from the  fund itself.   He  said that  if members                                                               
wish  to use  language  - like  "shall" -  that  option is  still                                                               
present.  He  said HJR 9 keeps any amount  that is withdrawn from                                                               
the permanent fund sustainable.                                                                                                 
9:20:55 AM                                                                                                                    
REPRESENTATIVE GROH  stated that  HJR 9  does not  address levels                                                               
for PFDs,  but rather addresses the  amount of the draw  from the                                                               
permanent fund itself.                                                                                                          
         HJR  9-CONST AM: PERMANENT FUND; POMV;EARNINGS                                                                     
         HJR  8-CONST AM: GUARANTEE PERM FUND DIVIDEND                                                                      
             HJR  7-CONST AM: PERMANENT FUND DIVIDEND                                                                       
         HB  90-PERMANENT FUND DIVIDEND; $1000 DIVIDEND                                                                     
        HB  72-PERMANENT FUND DIVIDEND; 75/25 POMV SPLIT                                                                    
9:22:23 AM                                                                                                                    
REPRESENTATIVE MCCABE  announced that the next  order of business                                                               
would be HOUSE  JOINT RESOLUTION NO. 9,  "Proposing amendments to                                                               
the Constitution  of the State  of Alaska relating to  the Alaska                                                               
permanent fund  and to appropriations  from the  Alaska permanent                                                               
fund" and HOUSE JOINT RESOLUTION  NO. 8, "Proposing amendments to                                                               
the Constitution  of the State  of Alaska relating to  the Alaska                                                               
permanent  fund  and  appropriations from  the  Alaska  permanent                                                               
fund" and HOUSE JOINT RESOLUTION  NO. 7, "Proposing amendments to                                                               
the Constitution  of the State  of Alaska requiring payment  of a                                                               
dividend to eligible state residents"  and HOUSE BILL NO. 90, "An                                                               
Act  relating to  income of  the  Alaska permanent  fund and  the                                                               
amount  available for  appropriation; relating  to appropriations                                                               
from the earnings reserve account;  relating to the amount of the                                                               
permanent  fund dividend;  and providing  for an  effective date"                                                               
and HOUSE BILL NO.  72, "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."                                                                                  
9:22:41 AM                                                                                                                    
REPRESENTATIVE MCCABE  opened public testimony  on HJR 9,  HJR 8,                                                               
HJR 7, HB 90, and HB 72.                                                                                                        
9:24:01 AM                                                                                                                    
JOHN MILLER, representing  self, stated that he is  in support of                                                               
returning  back to  the original  permanent  fund dividend  (PFD)                                                               
formula,  which he  said  has  been successful  for  the last  35                                                               
years.  He said that in  2016, the process was destroyed, and has                                                               
been   a  major   contention  ever   since.     He  offered   his                                                               
understanding that  the people  feel betrayed  and feel  that the                                                               
legislature no  longer has the  people's best interests  in mind.                                                               
He said the  permanent fund is used to pay  back special interest                                                               
groups and unions  who funded their elections.   He urged members                                                               
to follow the  law and the original PFD formula.   He warned that                                                               
until the PFD is returned to  the original formula, there will be                                                               
9:25:55 AM                                                                                                                    
ED MARTIN,  representing self, shared  that he's been  a resident                                                               
of the  state for over 50  years.  He further  shared that family                                                               
member Ed Martin, Sr. was a lawmaker  in 1999 and was part of the                                                               
"save the  dividend" campaign.   He suggested  that those  in the                                                               
committee  might  remember  the   advisory  vote,  in  which  the                                                               
legislature was  recommended to never  touch the PFD  process, as                                                               
it was established  in 1982, which entails a  full statutory PFD.                                                               
He stated  that some members  of the committee voted  for budgets                                                               
that defy  statute, and  further stated  that the  Alaska Supreme                                                               
Court's actions did  not mandate that the  legislature could defy                                                               
statute.  He  referred the sponsor statement for  HJR 7 [included                                                               
in  the committee  packet], in  which  notes that  the draws  are                                                               
sustainable, which  he opined is  a lie.   He stated, "No  one in                                                               
that room has  a crystal ball."  He said  the proposed $1,000 PFD                                                               
within HB  90 is a slap  in the face  to the people that  own the                                                               
resources,  as well  as the  investments  and the  return on  the                                                               
investments.    He  stated  that  he  is  in  support  of  a  PFD                                                               
constitutional  amendment.   He said  it is  unimaginable that  a                                                               
constitutional   amendment  would   be  required   to  make   the                                                               
legislature follow the law.                                                                                                     
9:28:27 AM                                                                                                                    
MISTY COLE, representing self, said she  supports HJR 7 and HJR 8                                                               
and opposes HB 72, HB 90, and HJR 9.                                                                                            
9:29:41 AM                                                                                                                    
DONALD MITCHEL,  representing self, shared  that he has  lived in                                                               
Alaska for  51 years.   He  said there are  many benefits  to his                                                               
living  in  Alaska,  one  of  which  he  highlighted  was  having                                                               
competent and  consistent government  services without  having to                                                               
pay a state tax.  However,  he stressed that things have changed,                                                               
and there  is now  inadequate or  inconsistent funding  for state                                                               
services.   He  said  the roads  in his  area  are horrible,  the                                                               
Alaska Marine  Highway System (AMHS)  is unreliable,  and funding                                                               
for state  employees is difficult.   He  stated that the  way the                                                               
PFD  is structured  hurts  the elections  process,  in that,  the                                                               
amount of the PFD  is being used as a tool to pay  for votes.  He                                                               
said HB  72 would  provide reliability  and consistency  to state                                                               
services and the PFD.  He urged support for HB 72.                                                                              
9:30:49 AM                                                                                                                    
SARAH CAMPBELL,  representing self, shared  that she is  a public                                                               
school teacher  and has lived in  Alaska for 48 years.   She said                                                               
she is  a supporter  of increasing  the base  student allocation,                                                               
and would also like to see  the state return to a defined benefit                                                               
retirement package for  state employees, but said  that will cost                                                               
money.   She  stated that  she is  a proponent  of fully  funding                                                               
state services.   She commented  that HB  72 seems fair,  in that                                                               
Alaskans will  get a PFD and  know there will be  money for state                                                               
9:32:48 AM                                                                                                                    
MICHAEL GARHART,  representing self,  commented that, out  of the                                                               
bills  up for  testimony  today,  he only  supports  HJR  7.   He                                                               
explained that there  has been too much PFD money  taken from the                                                               
public.   He  stated, "Since  the  1990s, it  was tracked:  $27.3                                                               
billion had been stolen prior to  deposit into the accounts."  He                                                               
said  that  the legislature  was  questioned  for 10  years,  and                                                               
answers were never given.  He  said the state needs to follow the                                                               
9:33:48 AM                                                                                                                    
ANTONIA  LENARD,  representing  self, opined  on  the  "legalese"                                                               
language in the materials provided  in today's meeting.  She said                                                               
that  the original  founder of  the PFD  was getting  a stake  in                                                               
Alaska's land and  resources, and the residents  were supposed to                                                               
be  paid  out  of  the   funds  that  were  generated  by  people                                                               
profiting.   She  spoke  on  the 75/25  percent  of market  value                                                               
(POMV) split,  and said that  the split should instead  be 25/75.                                                               
She  suggested that  the need  for  state funding  would go  away                                                               
since  residents would  have enough  money individually  to carry                                                               
out  state services,  like  building  a school.    She said  that                                                               
anytime the  legislature seeks  to draw from  the fund,  then the                                                               
draw should be put to a vote.                                                                                                   
9:36:03 AM                                                                                                                    
BERT  HOUGHTALING,  representing self,  urged  that,  out of  the                                                               
bills that are  being taken up at today's meeting,  only HJR 8 be                                                               
allowed  to move  forward.   He referred  to the  other bills  as                                                               
"putting  lipstick on  a pig,"  in which  the bills  seek to  put                                                               
further legislative control on the PFD.   He explained that HJR 8                                                               
would  put the  corpus into  legislative control.   He  said that                                                               
combining  the corpus  and the  permanent fund  would make  it so                                                               
legislators now  also have control over  the corpus.  He  said he                                                               
supports HJR 7 so far that  it formalizes what has been in Alaska                                                               
statute  for  the  last  four  decades.    He  pointed  out  that                                                               
Legislative  Legal  Service's  definition of  "shall"  and  "may"                                                               
might be  the clinical  definition in a  dictionary but  does not                                                               
compare to the definition provided  in Wielechowski v. State.  He                                                               
relayed  that the  Alaska Supreme  Court ruled  that "shall"  and                                                               
"may" have the exact same meaning.                                                                                              
9:39:01 AM                                                                                                                    
SARANA SCHELL, representing  self, stated that she  is calling in                                                               
support of  the sustainability of  the permanent fund.   She said                                                               
that, while  large dividends are great,  she is willing to  put a                                                               
cap on  the PFD.   She said she supports  the cap since  it would                                                               
help with the sustainability of the fund.                                                                                       
9:40:07 AM                                                                                                                    
JAMELIA  SAIED, representing  self, shared  that she  has been  a                                                               
resident  for 61  years.   She  said that  the PFD  has served  a                                                               
valuable purpose,  but said she thinks  it is time to  end it and                                                               
reestablish an income tax.   Since that does not seem politically                                                               
possible, she  remarked, she supports  whichever bill  proposes a                                                               
smaller  PFD that  the  state  can provide.    She  said that  is                                                               
reflected  in Representative  Groh's bill.   She  urged that  the                                                               
state  needs  to  stay  conservative,   and  that  if  the  state                                                               
distributes a  full PFD,  it will  not have  the money  for state                                                               
9:42:23 AM                                                                                                                    
ROYAL  KIEHL, representing  self,  said he  and  his family  have                                                               
lived in Alaska since 1974, and  at that time the state levied an                                                               
income tax.   He commented that the state  has, without intending                                                               
to  do  so, turned  into  a  welfare  state, with  every  citizen                                                               
believing they cannot live without their  PFD.  He said the state                                                               
cannot afford to live up  to the state's responsibilities because                                                               
of the annual payouts.  He  said the PFD has become an addiction.                                                               
He  stated  that  large  PFDs have  interfered  with  paying  for                                                               
quality  education,  as  well  as   adequate  ferry  service,  as                                                               
examples.  He stated that while it  may be painful to give up the                                                               
annual "moneybombs,  the situation has  gotten out of  hand, with                                                               
people believing  it is their  right to  get money they  have not                                                               
worked  for.   He suggested  that the  PFD amount  be reduced  to                                                               
$1000, with  annual inflation increases, and  fund state services                                                               
with the rest  of the earnings.   He said there should  be a year                                                               
before HB  90 is implemented  to allow residents time  to process                                                               
the change.                                                                                                                     
9:44:46 AM                                                                                                                    
RACHEL  LORD,  representing self,  stated  she  is testifying  to                                                               
support an increase in state  revenues through higher reliance on                                                               
permanent fund  earnings in  order to fund  state services.   She                                                               
stated  her support  for HB  72.   She echoed  comments regarding                                                               
raising broad  based revenues  in the state  being the  right way                                                               
forward, or so  too could be the combination of  income tax and a                                                               
reduced PFD.   She said  that at the borough  level, specifically                                                               
in the  Kenai Peninsula  Borough, citizens  pay for  the services                                                               
they receive  via property  and sales taxes.   This  funding goes                                                               
toward  schools,  roads,  and  state  troopers.    She  spoke  on                                                               
economic  development and  said that  businesses can  only thrive                                                               
when  there is  stability in  the public  sector.   She said  she                                                               
cannot see  how things will  get better without  actual financial                                                               
investment,  and pointed  out that  everyone is  benefitting from                                                               
state services.                                                                                                                 
9:46:59 AM                                                                                                                    
The committee took an at-ease from 9:46 a.m. to 9:49 a.m.                                                                       
9:49:00 AM                                                                                                                    
REPRESENTATIVE MCCABE handed the gavel over to Chair Carpenter.                                                                 
9:49:31 AM                                                                                                                    
DIANNE  HOLMES,  representing  self,  echoed  previous  testimony                                                               
regarding  the benefits  everyone receives  in untaxed  services,                                                               
but  recognized that  oil revenues  are volatile.   She  stressed                                                               
that state services should always come  first.  She said the past                                                               
few years  the state has had  to face the COVID-19  pandemic, and                                                               
now it  must face educational  needs.  She  said that of  the PFD                                                               
plans before  the committee today,  those proposing  a percentage                                                               
of split  will always  impact services.   She stated  that Alaska                                                               
does not  need larger PFDs if  that means services are  gone as a                                                               
result.   She  urged members  to listen  to economists,  and said                                                               
that a 25/75 split will take away from state services.                                                                          
9:51:26 AM                                                                                                                    
JAN CONITZ, representing self, said  she has been concerned about                                                               
the PFD debate  the last few years, and the  time the legislature                                                               
has spent  on the  discussion.   She said the  PFD is  a symbolic                                                               
"good  thing" rather  than  the check  being used  as  a part  of                                                               
needed  household income.    She  opined on  the  level of  state                                                               
services and highlighted  AMHS and public schools  as examples of                                                               
programs in  decline and in need  of attention and funding.   She                                                               
said she  is concerned about  the amount of time  the legislature                                                               
has  taken discussing  the PFD,  and further  said she  fears the                                                               
state  is  going to  go  bankrupt  trying  to  pay out  high  PFD                                                               
payments.   She acknowledged  that PFDs  are a  symbolically good                                                               
thing, in they  it provide a sense of ownership  to the resident,                                                               
but opined  they should  only be considered  symbolic.   She said                                                               
the annual  PFD debate  is "crowding  out" discussion  on policy,                                                               
one  of which  she suggested  is education  policy.   She further                                                               
suggested  better  support   toward  transportation,  university,                                                               
economic  development,   care  for   seniors,  and   people  with                                                               
disabilities.  She stated that she supports an income tax.                                                                      
9:54:50 AM                                                                                                                    
RANDY GRIFFIN, representing self,  stated that his comments focus                                                               
on HJR 7  and HJR 8.   He expressed his feeling that  the PFD has                                                               
no place  in the  Alaska Constitution,  and acknowledged  that he                                                               
has received thousands from PFD  payments, but stopped in 2014 to                                                               
begin returning  the check to the  state.  He said  he is against                                                               
enshrining the PFD into the  Alaska Constitution because he is in                                                               
favor  of a  dividend funded  by surplus  profit.   If it  is not                                                               
funded  by surplus  profit, then  he  said he  would consider  it                                                               
public assistance.  He stressed  that "hand-out" money should not                                                               
go into the Alaska constitution, and  that while he said he loves                                                               
free money, he  will only collect a  PFD if it is a  PFD based on                                                               
9:57:23 AM                                                                                                                    
NICOLAS ABRAMCZYK,  representing self, commented that  Alaska did                                                               
a good  thing in establishing  the permanent fund itself,  and he                                                               
noted how the fund has grown.   He advised members that they need                                                               
to  look at  the economic  context of  Alaska in  the 1980s,  the                                                               
population it had at the time, which he suggested was about one-                                                                
third of  what it  is today.   He pointed out  that, just  in the                                                               
last ten  years, there  have been  economic challenges  that were                                                               
not  present in  the 1980s.   He  spoke on  the bills  before the                                                               
committee,  and  advised members  to  first  examine the  state's                                                               
revenue streams.                                                                                                                
9:59:01 AM                                                                                                                    
PHILIP  TAFS,  representing  self,  shared that  he  is  a  small                                                               
business owner  in Alaska with 28  employees.  He stated  that he                                                               
believes state  services need  to be  funded first.   He  said he                                                               
loves the  PFD, but does not  believe that Alaska can  have large                                                               
PFDs  without   it  impacting  state  services.     He  expressed                                                               
opposition  to adding  language  in the  constitution and  making                                                               
things permanent, and  stressed that the state  needs to maintain                                                               
flexibility in how programs are funded.   He said that as a small                                                               
business owner  he needs consistency,  a way  to be able  to plan                                                               
for  something, without  having every  legislative session  bring                                                               
him  fear since  he does  not  know what  might come  out of  the                                                               
session.  He expressed frustration  from having to wait until the                                                               
last minute in August for a  special session, and said it creates                                                               
a difficult business environment.   He said that anyone who needs                                                               
the PFD  to get by  needs state services  more, which as  a small                                                               
business owner, would allow him to grow his business.                                                                           
10:01:55 AM                                                                                                                   
CANDY MILLER, representing self,  shared that her family switched                                                               
to a  different health  insurer, they saved  70 percent  on their                                                               
expenses.  She said the Alaska  budget could go from red to black                                                               
if people  choose their own health  insurance.  She said  that if                                                               
more money  is taken  out of government  and put  to individuals,                                                               
the  individuals  would  make  decisions   that  would  save  the                                                               
government  money.   She said  she  learned that,  while she  was                                                               
changing her  healthcare plan, that  a teacher in  the Matanuska-                                                               
Susitna valley  was paying $20,000  for their plan, and  the plan                                                               
she herself was $2,000 a year.                                                                                                  
CHAIR CARPENTER  interjected to request  that Ms.  Miller testify                                                               
to the bills under public testimony today.                                                                                      
MS. MILLER  said she is in  favor of HJR  7.  She said  the money                                                               
from the  permanent fun should go  into the people's hands.   She                                                               
said there is  then no concern on whether to  raise taxes because                                                               
the people will direct it.                                                                                                      
10:05:12 AM                                                                                                                   
MICHAEL  BUCY,  representing self,  shared  that  he has  been  a                                                               
resident of Alaska  and has been receiving a PFD  since 1982.  He                                                               
said  he would  support  putting language  into the  constitution                                                               
only if  it were to cap  the PFD payout.   He shared that  he was                                                               
flabbergasted  when  the  governor  announced a  $4,000  PFD,  in                                                               
conjunction with no BSA increase,  which prompted him to rally at                                                               
the capitol.   He said he  appreciates what the PFD  has done for                                                               
his family,  and that  others may  rely on the  PFD, but  what he                                                               
would like to  see is robust welfare funding instead.   He opined                                                               
that millionaires  don't need the  PFD and shouldn't  receive it.                                                               
He said  the function  of government  is to  perform economically                                                               
what the  individual cannot.   He said  that right  now residents                                                               
are depending on the government.   He remarked that government is                                                               
not the  problem, bad  government is.   He  said that  people are                                                               
leaving Alaska despite  high PFDs, and urged that  that be turned                                                               
around, and that the PFD no longer be an annual debate.                                                                         
10:08:49 AM                                                                                                                   
GEORGE PIERCE, representing self,  spoke to education funding, in                                                               
that  the government  sent schools  funding  during the  COVID-19                                                               
pandemic, which he said was being  used to refurbish schools.  He                                                               
stated that Alaska needs an income  tax and to get people who are                                                               
not living  in the state to  pay their fair share.   He advocated                                                               
raising the tax on oil and mining.                                                                                              
CHAIR CARPENTER stated that the  public testimony is specifically                                                               
for bills relating to the PFD.                                                                                                  
MR.   PIERCE  advised   to  mandate   the  PFD   in  the   Alaska                                                               
Constitution.   He suggested that  if the state  needs resources,                                                               
get  rid  of   the  subsidies.    He   further  suggested  taxing                                                               
individuals  coming up  to  conduct tourism  business.   He  said                                                               
there  are other  kinds of  revenues  to generate,  but said  the                                                               
legislature wants to  take it from poor Alaskans.   He reiterated                                                               
his suggestion to raise taxes on the oil and gas companies.                                                                     
10:11:13 AM                                                                                                                   
HAROLD  BORBRIDGE,  representing  self, stated  that  the  public                                                               
needs to  realize that  every dollar the  state receives  is from                                                               
the people,  whether it  be paid with  the people's  resources or                                                               
the  permanent fund's  returns,   because every  dollar spent  is                                                               
either  from  oil resources  or  from  the  permanent fund.    He                                                               
suggested that  a simple handout  be made explaining  the sources                                                               
of state revenue.                                                                                                               
10:12:46 AM                                                                                                                   
WILLY KEPPEL,  representing self,  prefaced by urging  members to                                                               
follow  state statute  and pay  a full  PFD.   He suggested  that                                                               
baseline spending be set at $4.2  billion so that the state's tax                                                               
and  futures revenue  can actually  pay for  state services.   He                                                               
reminded  members  that Alaskans  paid  for  three extra  special                                                               
sessions a number of years ago,  and opined on the outcome of the                                                               
sessions.   During committee hearings  in a previous  session, he                                                               
said there  was a testimony  that stuck out  to him: there  is no                                                               
problem in paying a PFD because  the state has had the money, but                                                               
the legislature  as of late  has been  opting to take  money from                                                               
the  PFD.   He  further  recounted the  statement  that prior  to                                                               
actions  made  during  the  Walker  Administration,  money  going                                                               
toward PFDs never  went through the legislature.   Following this                                                               
testimony, he  further recounted, Senator Lyman  Hoffman inquired                                                               
as to  why the  legislature did  not follow the  law on  PFDs, to                                                               
which  the answer  was  that  the legislature  does  not have  to                                                               
follow the law.  He reiterated his  call to members to pay a full                                                               
PFD and cut spending.                                                                                                           
10:16:08 AM                                                                                                                   
TIM WILKINS, representing self, agreed  with comments made by Mr.                                                               
Keppel.  He recounted that  in 2015 the Walker administration had                                                               
moved to take 50 percent of  everyone's PFD and expressed his own                                                               
disagreement  with that  action.   He suggested  that the  PFD be                                                               
enshrined in the Alaska Constitution.   He said that the state of                                                               
Alaska needs to balance its  expenses, and urged that money taken                                                               
out of one  pot and put into another, be  replaced.  He expressed                                                               
his support for the Dunleavy administration.                                                                                    
10:18:18 AM                                                                                                                   
PAULINE  HESSING,   representing  self,  thanked   the  committee                                                               
members for talking  about the PFD.  She said  that she considers                                                               
debates on  the amount of the  PFD wasted time, and  would rather                                                               
like to see  the legislature debate other pressing  matters.  She                                                               
suggested that  the PFD  be capped at  $1,000, and  that anything                                                               
over that  amount would be  considered money that the  people are                                                               
giving to the  state to use for services.   She pointed out there                                                               
is no income tax in Alaska,  and suggested that her idea would be                                                               
a mechanism that  would function like an income tax.   She stated                                                               
that permanent fund  earnings are not for the  individual but are                                                               
owned by all  Alaskans.  She said  that if the PFD  was capped at                                                               
$1,000 a year, it would also  be less of an enticement for people                                                               
who have no money and want to come to Alaska for free  money.                                                                   
10:20:01 AM                                                                                                                   
The committee took a brief at-ease at 10:20 a.m.                                                                                
10:20:05 AM                                                                                                                   
CHAIR CARPENTER  made comments  regarding the  committee's intent                                                               
to hear further public testimony.                                                                                               
10:21:47 AM                                                                                                                   
The committee took an at-ease from 10:21 a.m. to 10:31 a.m.                                                                     
10:31:45 AM                                                                                                                   
LEONARD MILLER,  representing self, stated that  he could support                                                               
HJR 7 and HJR 8 but needs  more information.  He said his concern                                                               
with bills  that deal  with the permanent  fund is  that, without                                                               
research and  legal understanding,  the ordinary  Alaska resident                                                               
will find it  hard to make an informed decision,  but could still                                                               
make an informed decision about what  candidate to elect.  As far                                                               
as what is  fair for the permanent fund, he  said residents share                                                               
the fund's wealth, which he said  encourages him to do what he is                                                               
doing now: advocating to defend the  principal of the PFD.  Since                                                               
a vast  majority of residents do  not have mineral rights  in the                                                               
state,  he explained,  the minerals  are part  of the  residents'                                                               
corporate  royalties, and  former Governor  Jay Hammond's  vision                                                               
was that  Alaska residents  would share in  the earnings  so that                                                               
residents  would   stay  engaged   in  limiting  the   growth  of                                                               
government.    He  urged  members to  not  steal  the  resident's                                                               
10:34:22 AM                                                                                                                   
LILA  HENDERSON,   representing  self,  disclosed  that   she  is                                                               
registered Republican.   She stated that she does  not support HB
72 and HB 90.   She said she backs HJR 8 and  parts of HJR 7, and                                                               
is  overall  in  favor  of  constitutionalizing  the  PFD.    She                                                               
expressed that the state is taking  more and more of the PFD, and                                                               
opined  that the  people are  entitled to  their royalties.   She                                                               
echoed Mr. Millers comments on that matter.                                                                                     
10:35:34 AM                                                                                                                   
JAMES SQUYRES, representing self, stated  that he supports a full                                                               
statutory PFD.   He commented  that the public has  testified for                                                               
many years for  a full statutory PFD.  He  urged members to think                                                               
about  the people  that have  testified for  the PFD  before, and                                                               
that,  just because  the people  are  not in  the committee  room                                                               
today, does not  take away from past testimony.   He said he does                                                               
not support  putting the POMV  in the Alaska  Constitution unless                                                               
the  earnings reserve  is rolled  into  the permanent  fund.   He                                                               
asked for  the difference between  statutory PFDs  not previously                                                               
paid, and  refundable oil and  gas tax  credits.  He  pointed out                                                               
that rolling  the earnings reserve  into the permanent  fund ends                                                               
the PFD  payback, which he  said is  still owned to  residents in                                                               
the  state.     He  advised   members  to  repeal  SB   26  [30th                                                               
Legislature], which he said put the  POMV into statute.  He noted                                                               
that  last  year the  administration  had  the  POMV PFD  in  the                                                               
budget,  but  there   was  no  effort  to  repeal   SB  26  [30th                                                               
Legislature]; and commented  that, if Alaska wants to  go back to                                                               
the  way it  was with  the PFD,  what's taken  place needs  to be                                                               
unraveled.  He suggested that putting  the POMV and full PFD into                                                               
the  Alaska  Constitution  put   the  "squeeze"  on  funding  for                                                               
10:37:56 AM                                                                                                                   
JEAN HOLT, representing  self, Testified in opposition  to HB 72.                                                               
She stated government  has taken away freedoms, and  that the PFD                                                               
should be enshrined  in the Alaska Constitution.   She said there                                                               
are people  who are  opposed to  the PFD being  taken away.   She                                                               
further urged members to not mess with the PFD.                                                                                 
10:39:17 AM                                                                                                                   
The committee took an at-ease at 10:39 a.m.                                                                                     
10:39:54 AM                                                                                                                   
GARY  MCDONALD, representing  self, stated  that he  supports the                                                               
regular PFD formula that Alaska had for about 30 years.                                                                         
10:41:12 AM                                                                                                                   
RYAN BROUSSARD,  representing self, inquired about  the number of                                                               
active military  who are receiving a  PFD.  He explained  that in                                                               
boot camp  he was  told to  go to  Alaska, do  a short  tour, and                                                               
collect  the PFD  for  the rest  of  his career.    He said  this                                                               
process  is  recommended  to  people,   and  recounted  that,  in                                                               
Virginia, there  were many Alaska  license plates.   He expressed                                                               
concern that a  large number of PFDs are going  out of state, and                                                               
also out of the  country.  He said that he  and his family relied                                                               
on the  PFD, and  that the  PFD should  be returned  to statutory                                                               
10:43:20 AM                                                                                                                   
The  committee  took back-to-back  at-eases  from  10:43 a.m.  to                                                               
10:47 a.m. to await arrival of the final testifiers of the day.                                                                 
10:47:57 AM                                                                                                                   
LAURA HECKERT, representing self, called  for the passages of HJR
7 and HJR  8.  She said she  wants a PFD payout to  be done using                                                               
the previous distribution formula.                                                                                              
10:49:18 AM                                                                                                                   
The committee took an at-ease from 10:49 a.m. to 10:52 a.m.                                                                     
10:52:09 AM                                                                                                                   
WILLIAM REINER, representing self, stated  that he is in favor of                                                               
HJR 8, and  expressed disagreement with HB 72, HB  90, HJR 7, and                                                               
HJR 9.   He highlighted that in  HJR 9, and stated  that there is                                                               
no need for the  bill as it "muddies the water."   He shared that                                                               
he's been  an Alaska resident since  1976 and was around  for the                                                               
start of  the PFD.  He  referred to the U.S.  Supreme Court case,                                                               
Zobel v.  Williams, and said  he is leaning towards  the decision                                                               
the  court  made.    Regarding  mineral  and  gas  royalties,  he                                                               
disclosed that  he is not  an Alaskan Native,  and due to  a 1948                                                               
law, he  cannot access any minerals,  oil, or gas on  property he                                                               
10:55:55 AM                                                                                                                   
JOEL SIGMAN,  representing self,  testified in  support of  HJR 7                                                               
and said he wants a full PFD.   He opined on proper public notice                                                               
of legislation.  He said he  is tired of the legislature stealing                                                               
people's  money and  budgeting improperly.   He  stated that  all                                                               
residents should  get a full PFD.   He urged members  to not take                                                               
the money from the people and to give it back to the people.                                                                    
10:58:15 AM                                                                                                                   
SYBIL CURRY,  representing self, shared  she has lived  in Alaska                                                               
for 20 years  and is a legal immigrant from  a socialist country.                                                               
She  further shared  she is  a  U.S. citizen,  a law  enforcement                                                               
veteran, and  that her grandparents  survived Nazi Germany.   She                                                               
stated  that what  is happening  in America  is horrible,  noting                                                               
that several  banks have crashed.   She  said the people  want an                                                               
original  statutorily determined  PFD, and  she recommended  that                                                               
the PFD be enshrined in the Alaska Constitution.                                                                                
11:00:00 AM                                                                                                                   
CHAIR CARPENTER reminded the public  that they can submit further                                                               
comments electronically.                                                                                                        

Document Name Date/Time Subjects
HJR009A.PDF HW&M 3/11/2023 9:00:00 AM
HJR 9 sponsor statement.pdf HW&M 3/11/2023 9:00:00 AM
HJR 9 sectional analysis.pdf HW&M 3/11/2023 9:00:00 AM
2003-05-APFC-Resolution-POMV.pdf HW&M 3/11/2023 9:00:00 AM
2020-01-APFC-Resolution-POMV-Support.pdf HW&M 3/11/2023 9:00:00 AM
PF_singleaccount_graphic.pdf HW&M 3/11/2023 9:00:00 AM
PF_TwoAccountgraphic.pdf HW&M 3/11/2023 9:00:00 AM