Permanent Fund dividend misinformation about residents’ legal rights misleads many Alaskans. Some people incorrectly assert that residents own the resources, they own the Permanent Fund, they own the revenue from the Permanent Fund and they, therefore, have a legal “right” to PFDs. Incorrect legal assertions, for some, become their banner for political debate.
These legally incorrect assertions cause many to loudly shout unsupported and undocumented claims that individual Alaskans have direct ownership in both the oil resource and its royalty stream.
Alaska’s constitution, the highest law for the state, contains Article VIII on “Natural Resources.” Section 2 reads, in full: “The legislature shall provide for the utilization, development, and conservation of all natural resources belonging to the State, including land and waters, for the maximum benefit of its people.”
Alaska’s constitutional language, drafted in 1955 and subsequently adopted by vote by Alaska’s residents, formed the basis for the United States to grant statehood in 1959. Nowhere was resident ownership recognized; our constitution simply includes no resident ownership.
There is no part of “belonging to the state” which allows for resident ownership of natural resources or a first right to revenue produced from state resources.
Resident ownership advocates appear not to understand — or worse, choose not to reveal — potential risks of claiming ownership, including adding such language to the constitution. In addition to the destruction of Alaska’s capacity to self-govern, which would follow if residents had this ownership interest, efforts to remove full state ownership of the natural resources violates the federal Alaska Statehood Act.
Section 4 of the Alaska Statehood Act states that Alaska: “and its people do agree and declare that they forever disclaim all right and title to any lands or other property not granted or confirmed to the State … "
Section 5 reads, in full: “The State of Alaska and its political subdivisions, respectively, shall have and retain title to all property, real and personal, title to which is in the Territory of Alaska or any subdivisions. Except as provided in section 6 hereof, the United States shall retain title to all property, real and personal, to which it has title, including public lands.”
Section 6 addresses “Selection from public lands,” whereby Alaska was entitled to select lands from federal public lands for Alaska’s ownership.
A real risk to Alaska — forfeiture to the federal government — arises should transfer of substantial ownership of Alaska’s resources to residents occur. Section 6(i) of the Alaska Statehood Act is explicit: “Provided, That any lands or minerals hereafter disposed of contrary to the provisions of this section shall be forfeited to the United States by appropriate proceedings instituted by the Attorney General in the United States District Court for the District of Alaska.”
Legally, what these sections mean: If Alaska abandons full ownership of its resources and its royalty revenue by granting residents a first-right to a PFD over competing state government obligations, there is a forfeiture risk. It was well understood at the time of statehood that Alaska did not have a self-sustaining economy — apart from federal expenditures — such that Alaska would be incapable of supporting the cost of self-government without the revenue generated from its natural resources.
To elevate PFD payments to a first-right, asserting a resident’s interest in the natural resource is superior to Alaska’s interests, violates Alaska’s constitution and Alaska Statehood Act.
People who intentionally or unintentionally mislead about PFDs for political gain should be rejected.
The Alaska Constitution is clear: Natural resources belong to the state. The Alaska Statehood Act, the law of the U.S. government, is clear: natural resources belong to Alaska. Mess with that and the risk to Alaska is forfeiture of lands or minerals back to the United States, which by default ends all future PFDs.
Alaska’s constitution is also specific in pointing out the evil called dedicated funds — See Art. IX Sec. 7. Assertions that PFDs have a first-right to Alaska’s revenue, whether that is by statute or an attempt to insert constitutional language, is to pursue dedicated funds, to the detriment of Alaska’s ability to operate a self-sustaining government. Dedicated funds are prohibited. Creating PFDs as a first-right “property” is dedication of resource funds. Dedicated funds, which also create a forfeiture risk, materially restrict Alaska’s ability to pay its cost of self-governing.
Neither PFDs nor dedicated funds, which remove Alaska’s priority ownership of its natural resources, belong in Alaska’s constitution. PFDs must remain secondary to Alaska’s ownership of its natural resources. Alaska must have primary access to the revenue generated by resources derived from state lands. PFDs cannot be dedicated from natural resources.
Joe Paskvan is a lifelong Alaskan and retired attorney. He served in the Alaska State Senate from 2008 to 2012, including a year as co-chair of the Senate Resources committee. He lives in Fairbanks.
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