That's how much the state will pay out in Permanent Fund dividend checks and one-time "resource rebates."
A half-million Alaskans will receive their "free money" by direct deposit to their bank accounts on Sept. 12, state officials announced Friday.
The rest will get checks mailed out starting Sept. 30.
The dividend check is the highest ever: $2,069. Dividends are paid from investment profits of the $36 billion Alaska Permanent Fund.
The $1,200 rebate, paid from this year's record oil revenue, is intended to help Alaskans cope with skyrocketing fuel prices.
Past reports have shown that Alaskans use their dividends in almost every way imaginable, from travel to spending sprees to savings. But experts caution that Alaskans would be wise to set aside some of this year's record payment for taxes -- which could total $600 to $800 for many.
Whether residents spend the rebate on barrels of stove oil or plasma screen TVs will depend on their geography -- many villages and some urban areas are troubled by the rising cost of heating fuel and gas. In Southcentral, those costs haven't gone up nearly as much.
A statewide survey commissioned by the Foraker Group last November showed that remote rural Alaskans were more likely to spend their dividend on household expenses than urban Alaskans -- 80 vs. 60 percent.
NOTHING CLOSE
Wherever the money flows, its $1.26 billion economic impact will be unprecedented.
It will amount to roughly 7 percent of Alaskans' personal income this year, said Neal Fried, a state economist.
In the history of the state's Permanent Fund, "there's nothing close," he said.
The windfall for some families will be large enough for a down payment on a house or to foot the bill for a major home repair, he said.
Dave Vandort, a manager at Pyramid Audio-Video in Anchorage, said the bigger dividend will prompt many of his customers -- mainly 16- to 24-year-old males -- to splurge on more expensive toys this year.
Think car navigation systems or Bose radio equipment.
"At least I'm hoping, anyway," he said.
BIGGER TAX HIT
Splurgers, beware.
With a bigger dividend will come a bigger tax bill.
For example, a typical family of four could be on the hook for almost $3,000 in taxes on its dividend and rebate. Each child could be liable for roughly $600 in income taxes, depending on their parents' tax rate.
If families spend their dividends without setting aside some for taxes, "they could be in trouble next April," said Tracy Hartung, an Anchorage certified public accountant.
FILL 'ER UP
This year, Bush residents say the checks will arrive just in time to defray some massive fuel bills.
"When it gets real cold in winter, it can take five gallons of fuel for heating overnight," said Wanda Sue Page, who lives in the Arctic village of Noatak, where residents pay more than $9 for a gallon of gasoline and nearly $10 for a gallon of heating oil.
"I'm going to fill my 52-gallon tank up to the top and put the heat up real high," Page said. "And when it gets empty, I'm going to fill it again."
Word spread quickly about the dividend payout in the tiny Bering Sea island village of Gambell.
Brandon Boolowon, the janitor at the tribal council office, said he heard about it on the Nome radio station Friday morning. Soon after, it was the talk of the town, he said.
One of the biggest energy bills in Gambell is stove oil, Boolowon said. A one- to two-week supply now costs about $400.
"That dividend will help out," he said.
Sam Shields, who lives in the Kuskokwim River town of Bethel, also is among the 610,768 people who will receive the dividend this year.
Shields said the money is desperately needed in his community, where he recently saw a whole chicken selling for $23 at the grocery store. Gasoline is going for almost $6 a gallon, but that price is expected to reach $8 when the last barge of the season delivers its load of fuel.
To make ends meet, Shields and other residents are relying more on subsistence foods like moose and caribou meat, salmon and berries. The state payout is already spoken for, he said, destined to pay for fuel, bills and a new wood-burning stove that should cut down on his heating costs.
"Everyone around here was happy to hear how much we're getting," he said. "Mainly everybody here is saying they're going to use it on fuel."
Find Elizabeth Bluemink online at adn.com/contact/ebluemink or call 257-4317. The Associated Press contributed to this story.
What's your PFD/resource rebate income-tax burden?*
• If you are a single adult: Save at least $800 for taxes.
• If you are under 18: Save at least $600 for taxes.
• If you are a family of four: Save at least $2,800 for taxes.
• Actual tax burden depends on income level. These calculations are based on an income tax rate of 25 percent.
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