The president has approved oil drilling at Willow, but Alaskans should not be counting on a big Permanent Fund dividend, nor a big boost to the state general fund. As Adam Wool pointed out in his commentary on March 6, Willow is on federal land. Alaska gets a big 0% in royalties. Contrast this percentage with the 90% royalty Alaska got for oil wells on Alaska lands at Prudhoe Bay and Cook Inlet. Alaska funded its government for years, built its infrastructure, and created a Permanent Fund from that 90% royalty.
This time, the feds have promised to “set aside” 50% of the royalty for “impact grants,” but only to local communities in the North Slope Borough, population 10,972. But first those communities will have to write a grant, and prove an “impact.” Maybe there will be a new bridge, or a dock or a road, and likely an oil spill or two in the future to clean up with that “set-aside” Willow money. Most of that 50% share, however, will be sitting in the federal treasury for years and years, not in the Alaska Permanent Fund nor the Alaska general fund.
Alaskans can look forward to devastating losses from future climate change disasters, thanks in part to Willow, while watching their PFDs and state coffers dwindle to nothing. The Alaska delegation really took their eye off the ball this time.
— Bruce Brown
Palmer
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